Of the different media used for advertising and promotion that BIA/Kelsey tracks in the LCM survey, only two of the traditional media crack SMB’s top 10 most used media for advertising and promotion: newspapers and direct mail. The rest of the top 10 are filled with digital media.

In the chart below, I looked at eight of the traditional media from LCM. Newspapers and direct mail, the only two of the traditional media to crack the Top 10 most used media list, fall first and second among traditional media. Radio comes in third, with TV and outdoor bringing up the rear for usage.

But how do SMBs perceive the return on their investment for time spent in advertising or promoting themselves on traditional media? The traditional media with the highest usage, newspapers, had the lowest perceived ROI, while the ones with lower usage: TV, cable and outdoor, had the highest ROI among the traditional media.

TV had the highest perceived ROI among the traditional media, with 50% of SMBs rating it as either excellent (10-19 times return on that investment) or extraordinary (over 20 times the return), while only 13.7% of SMBs surveyed reporting using TV to advertise or promote their business.

Newspapers, which had the highest usage among the traditional media, had the lowest perceived ROI, with 26% of SMBs reporting returns as excellent or extraordinary.

Radio had the third highest usage among SMBs for advertising/promotion. But advertisers who used radio as part of their advertising mix reported being pleased with the results, as 36% rated the perceived ROI of radio advertising as either excellent or extraordinary.

For the first time in several survey waves, SMBs indicated that they are actually decreasing the number of media used to advertise or promote their business. The implication: media must deliver concrete ROI or risk losing business traction. Digital media penetration with SMBs has increased, as many of these solutions generate concrete leads and offer trackable ROI metrics.

Traditional media are far from obsolete, however, as the data suggests, and many are still well-regarded. However, for newspapers in particular, and all traditional media, as SMBs enjoy more digital options and demand clear value from their advertising spend, the need to produce clear ROI is stronger than ever.

More information about LCM and custom renderings of the data can be found here.

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Wired on the iPad, via All Things D

Next month, Apple’s iPad comes out (and I will buy one). But what will be the impact of iPads and tablets from other companies on traditional media? Many are considering it to be the new magazine form factor. In theory, the iPad would make online ads compelling, and better enable digital subscriptions and a la carte buys. Wired Magazine, for one,  has been showing off a good-looking prototype. I highly recommend this video from The Wall Street Journal’s All Things D site.

Newspapers will look great, too. Look at The New York Times’ demo. My guess, however, is that the iPad’s impact on newspapers’ bottom line will be marginal for several years — and then, it may be too late. While the iPad should have excellent introductory sales, most sales will likely be low-end units without communications, so their usage will be mostly home and coffee shop based. Low-end units, limited to Wi-Fi Internet, are $499. Wireless Communications adds $130, plus $30 a month. Wi-Fi-only won’t provide a big lift to newspapers, because it doesn’t get the product onto commuter trains.

Newspaper companies, of course, are better positioned to participate in the mobile revolution than a year ago by virtue of their vertical properties, such as Classified Ventures’ Cars.com and Apartments.com. Both are “on the go” media sites that allow users to get information on a 24/7 basis, but more importantly, while they are out and about shopping for their category.

Other newspaper niche sites, like The Envelope from the LA Times, bring newspapers into an entirely new domain with the addition of online App games based on news and entertainment. These might ultimately play a role in the transformation of newspapers.

For now, I’m not counting on significant advertising or circulation revenues to develop for newspapers directly because of their investments in tablet devices, or mobile generally.

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