MediaNews Group Adds to Its Online Tool Belt

In our recently released special report on the newspaper industry, we profiled a few partnerships between traditional publishers and online players and speculated about future arrangements. One potential deal that clearly made sense involved WebVisible, a provider of interactive online advertising and simplified search products, and MediaNews Group, the growing Denver publisher that recently purchased four San Francisco Bay Area newspapers from the McClatchy Co., including the San Jose Mercury News.

Today, MediaNews Group and WebVisible announced that very partnership.

"The single biggest driver for the deal is that we wanted to find a local search product that would best leverage the relationship that our sales reps have with small-business owners," says Jim Misuraca, who is responsible for developing MediaNews Group's product road map. "Unlike many Yellow Pages reps, who only call on customers once per year, we have a more constant contact and, as a result, a more solid relationship with our advertiser. We needed a local search product that could help capitalize on that relationship."

WebVisible already has a relationship with McClatchy (profiled in our special report) that arms the newspaper publisher's sales force with expanded online advertising products meant to appeal to new and existing small-business advertisers (bundled clicks packages, for example). The strategy for McClatchy in part lies in offering new price points that appeal to the large segment of SMEs for which print advertising has been prohibitively expensive and thus out of the traditional reach of the publisher's sales channel.

For WebVisible — a company that has formed many partnerships with Yellow Pages publishers — the deals with McClatchy and now MediaNews Group give it additional penetration into newspapers, a strategy the company's top executive recently told us will be a priority over the next year.

"We're going hot and heavy over the newspaper industry because we knew we'd hit our max at a certain level with Yellow Pages," said Kirsten Mangers, WebVisible's chief executive officer, in a previously published interview with The Kelsey Group. "There are only so many places you can go now with the new AT&T. So we feel it's an excellent play to be able to engage the newspaper channel, especially since we have plenty of room to move given 18 percent to 20 percent redundancy between Yellow Pages and newspapers. So for newspapers, we're not even remotely done."

Misuraca maintains an attitude that we see catching on in the newspaper industry — that online portals and interactive advertising providers should be viewed as partners rather than competitors.

"You need to differentiate the search engine as a competitor — which they may be in terms of providing content — and the Internet advertising piece, which is important to help get a slice of the search revenue pie," says Misuraca. "Much like Google and Yahoo! aren't going to go out and hire tens of thousands of sales staff, we're not going to go out and create our own search engine. So I think we need to focus on our sales folks' relationships with local advertisers and then find products to plug into that channel."

Both Misuraca and Mangers agree, however, that training the sales channel is the biggest challenge in implementing these products.

"The product is so different," says Misuraca. "Some of our reps are familiar with search engines more so than others, but they're so used to selling impression-based advertising."

The Bottom Line: MediaNews Group isn't stopping here. Misuraca is interested in equipping his sales force with more online advertising tools to enable it to more effectively develop SME relationships. This will lead to partnerships with pay-per-call providers (in the past Misuraca confirmed MediaNews Group was in discussions with Ingenio), as well as hosting companies to provide Web sites for SMEs that don't have them.

"We're still in negotiation and things change every day," says Misuraca. "But we're definitely going to be focused on additional products for the proverbial tool belt."