The Decline and Possible Death of the Canadian Newspaper

In November Postmedia and Torstar swapped over 40 small newspapers and shut down most of them. This week is also the last for the Moose Jaw Times-Herald, which is 128 years-old. Meantime, the Globe and Mail reduced the size of its print edition to save costs.

In all cases, the reason for the closures is falling revenues, from circulation and advertising. Their demise is a sad backdrop for my friend Ken Goldstein's latest analysis of the future of print newspapers in Canada. 

Requiem for the print edition. That’s what Ken Goldstein of Communic@tions Management Inc. calls his most recent report on the future of newspapers in Canada.

In the report Goldstein, a leading authority on media economics and trends, notes that for much of the 20^th century the printed daily newspaper was a tangible expression of “continuity and familiarity.”

Today that “tangible form” is under serious threat from technology—the digital world.

As a result, he writes, “most of our general interest daily newspapers [have been put] into a downward spiral towards an unsustainable future.”

It wasn’t always this way, of course.

Historical data collected by Goldstein shows that daily newspaper circulation grew slowly in Canada immediately after Confederation, when 16.7% of households received a newspaper.

Paid circulation as % of Canadian households, 1867-2017

A period of more rapid growth began after 1880, in tandem with increased urbanization, the spread of railways and the telegraph, and the changes in technology and scale in the production of the newspapers themselves.

As a percentage of households, the peak occurred around World War I, with another slightly lower peak after World War II.

The early 1950s was the start of a period of about 40 years in which circulations grew, but not as fast as households.

Since the 1990s, actual circulation, and the relationship to households, have both declined.

“So we find ourselves in a very interesting place,” he writes. “Daily newspaper paid circulation in 2017 is equivalent to 14.8 per cent of households, which is lower than the percentage was in 1867.”

Paid circulation trend line to 2025

If this trend continues, he says, the percentage of households paying for a daily newspaper could fall to 10% by 2020, and to 5% by 2025.

In his 2015 discussion paper, which I wrote about on this blog, he noted that he “did not believe that a viable print business model exists for most general interest daily newspapers once paid circulation drops below 10% of Canadian households.”

At that time, he wrote, “Canada’s daily newspapers now are engaged in a 10-year race against time and technology to develop an online business model that will enable them to preserve their brands without print editions.”

Even more difficult, he says, is for them “to try to enable their online presence to maintain their current journalistic scope.”

Since then, the downward trend has accelerated, he says.

“The race against time and technology is no longer 10 years; it is closer to five.”

That urgency has become more evident in 2017, as more newspapers have closed.

Industry groups and others have put forward a number of suggestions, often involving government assistance, to deal with the problem.

Loss of Advertising & Death of the Classifieds

It's not just dropping circulation that is killing daily newspapers; so is the drastic decline in advertising.

Nothing illustrates this better than the death of the classifieds.

From a peak of $875 million in 2005, by 2016 newspapers only received $105 million from classifieds, Goldstein notes.

“The collapse of classified advertising in daily newspapers is a classic example of the ‘unbundling’ effect of technology,” he writes.

Through this unbundling, competitors like Craigslist and eBay were able to steal this lucrative part of the newspaper business.

Loss of this revenue is devastating for newspapers; as often has been said, circulation pays for the paper and the ink, but advertising pays for the journalism.

Back in 1964 media guru Marshall McLuhan recognized this: “The classified ads (and stock-market quotations) are the bedrock of the press. Should an alternative source of easy access to such diverse daily information be found, the press will fold.”

Sadly, his prediction seems to be coming true.

Near the end of the report, Goldstein wonders: Is it possible for newspapers to make the print-to-digital transition?

“Given the trends in circulation and advertising revenues, it seems unlikely that most general interest daily newspapers will be able to make the print-to-digital transition,” he writes.

There may be a small number of unique cases, he says, involving national or special interest daily newspapers.

“But for the classic mid-size local general interest daily newspaper, the prospects are not good.”

What’s the Solution?

So: What’s the solution?

For Goldstein, it means planning now for the paperless newspaper world.

“Both public and private policymakers should be spending the next few months modelling possible futures,” he says.

Things they need to discuss include the best ways to serve the public and public policy goals, best ways to intervene to help newspapers survive, and what to do if they completely fail—how will Canadians be informed?

Goldstein concludes by noting that the trends he has observed “are more than just some interesting history about newspaper circulation in Canada. They tell us where daily newspapers have been, but they also may be telling us where daily newspapers are going.

“Planning for the transition before we get there is not a luxury; it’s a necessity.”

What does this mean for non-profits? 

I'll do a longer post later, but for now let me put it this way: Three of the papers shut down by the Postmedia-Torstar swap (noted above) carried a lot of information about my organization. 

Their loss will make it more difficult for us to communicate with our supporters in those communities, and then to raise funds.

It may not be a requiem only for newspapers, in other words.

Read Ken’s complete analysis here.

Canadians and Foreign Aid: What Do They Think?

What do Canadians think about foreign aid?

They think it’s a good idea, but they don’t think Canada should spend more on it.

That is one of the findings from surveys done this year about Canadian attitudes towards foreign aid.

The three surveys were conducted this by the Canadian Council for International Cooperation, an umbrellas group for Canadian NGOs; the One Campaign, and CanWach (Canadian Partnership for Women’s and Children’s Health).

Of the three, only the CanWaCH survey is online.

When asked to rank a series of issues facing Canadians, and then asked which ones Canada should spend more on, aid was ranked at the bottom.

In the top four were healthcare, terrorism, unemployment in Canada and poverty in Canada.

Global hunger was near the bottom at #10 and poverty in the developing world was #13.

As one researcher put it: “No good news here with regard to development aid.”

For marketers and communicators, an important finding was that 64% of Canadians could not name a single relief and development organization.

We simply can't assume that most people know who we are, or that we exist, in other words.

Here are some other findings from the three surveys.

A majority of Canadians think foreign aid is a good idea, but support for it is soft. When asked, few agree Canada should spend more.

Most Canadians have no idea how much Canada spends on foreign aid.

One survey noted that the term “foreign aid” is not positive for most Canadians. It led one researcher to suggest that NGOs not use that term when making a case to the public for more spending on relief and development.

How many Canadians are supportive of foreign aid? According to one of the surveys, 23% of Canadians are active supporters, 20% are passive, 20% are swing, 15% are disengaged, 14% are passive opponents, and 9% are actively opposed.

What about those who oppose it—who are they? They tend to be conservative politically, high school educated, blue collar, male, older and rural. Unless they are religious, in which case they are supportive of helping others through aid. (This is something religious NGOs know, but it came as a surprise to one researcher.)

When those who support aid were asked why, the most common response in the surveys was a sense of moral duty and compassion.

When asked who they trust in the NGO sector, respondents indicated they trust the reports of individual relief and development workers above institutions.

When it comes to engagement in this issue, or most other issues and causes, participation is decreasing in the areas of volunteering, donating or participating in fundraisers. Where engagement is rising it is through social media.

When it comes to getting news, 61% of Canadians rely on Facebook. 19% list Twitter, 18% use YouTube.

Your thoughts?

Home Depot, Terrorist Attacks, Logos and Food Aid

It’s a great photo—a Rohingya woman holding a Canadian Foodgrains Bank bag of food.

What’s not to like? Our logo is prominently displayed.

It’s great marketing and public relations.

There’s nothing not to like about it, unless something goes wrong.

And as surely as Murphy of Murphy’s Law lives, something often goes wrong.

One of the most common occurrences for food aid organizations is when food goes astray and ends up in a market for sale.

When that happens, there are many reasonable explanations.

The food might have been stolen—something not unusual in places where people are desperate, the rule of law is lax, there is conflict, or there are too many guns.

Just about every place we send food aid, in other words.

Or a recipient family sold the food—again, not unusual in places where people have many needs, including for food.

Maybe they needed money for medicine to save a child’s life. Who wouldn’t sell food to do that?

It could also have been traded for a cooking pot to a local seller in the market, or for any other much-needed item.

Or the bag might simply have been used and thrown away, only to be used by a seller as a handy item for their shop.

All reasonable answers, but meaningless if a story comes out about our food aid being found to sale in the market. 

When that happens, agencies like the Foodgrains Bank are in a losing race to try to contain the damage.

Before you know it, it's gone viral on social media, causing damage and headaches for communicators and public relations practitioners.

And damaging it can be; when your reputation is staked on making sure donations get to those who need it most, the "loss" of food can set you back in the public's mind.

If we've done our job—if we've been proactive about talking about how challenging it is to do food aid—long-time and regular donors will know this, and not be worried.

But during emergencies, like the terrible situation facing the Rohingya, many donors are first-time givers.

They don't know what it's like to try to deliver food in places where almost everything has broken down, conflict is raging, or people barter food to meet other important needs.

All they know is that food from the Foodgrains Bank was found for sale; suddenly, we look like poor managers, wasting the donations of Canadians.

Thoughts about the opportunities and challenges of food aid came to mind following yesterday’s terrible attack in New York City.

The attacker used a rented Home Depot truck to mow down innocent bicyclists and walkers.

Photos from the aftermath of the attack clearly show the truck with Home Depot’s logo.

Home Depot did nothing wrong, as far as we know, in renting the truck to a legitimate user.

But still, there they are, associated with the attack, their name being used in most every news article about it. 

This is not the kind of publicity they were looking for, that;s for sure.

It will be interesting to see how they respond—how will they deal with this image issue?

An industry that has been proactive in dealing with these kind of public relations challenges is in the world of railways.

Companies that transport oil and other dangerous chemicals in tank cars never make the news unless a train derails. Then they are all over the news.

The oil and chemical companies have dealt with this by painting their tank cars a non-descript black without any company logos or names.

All they have is the required reporting marks, along with other information about the car and its contents.

When an accident happens, we see the cars laying askew off the tracks, but there are no company names.

Of course, the companies will be noted in news coverage, but not in images that can quickly span the Internet.

By keeping their names and logos off the cars, they proactively limit the public relations challenges.

Contrast this with the 1930s-50s, when companies emblazoned their names and logos on the side of tank cars. It was part of their marketing strategy.

But not today, not when everyone has a camera and people are so sensitive to environmental and other damage.

When it comes to marketing through products and services, whether that's on trucks, tanker cars or food aid, it can cut both ways—good and bad.

Those of us who work in communications need to be aware of both.

Facebook's New Explore Feed, or Remember the Rules of Facebook: Facebook Makes the Rules

Back in the old days of media relations, those of us who worked in communications for non-profits understood the rules of the media game.

In short, it was this: The media owned the newspapers, TV and radio stations, and they made the rules for who got coverage.

These rules varied from outlet to outlet, but in the main the rules for getting coverage involved being timely, topical, local, interesting, and always trying to provide human interest—a person with a story to tell.

It was our job, as communicators, to abide by these rules, and to use them to get the coverage we wanted.

Sure, it went both ways—the media needed us, the non-profits, as much as we needed them. They couldn’t know everything that was going on in the community, so they counted on us to help them find good stories about interesting people and programs to report.

Today, with the traditional media dying, the game has changed. Now if we want to reach supporters and others, we have social media—we can bypass things like newspapers, radio and TV and their old rules.

Now we can publish anything we want, anytime we want—no need to worry about things like editorial judgement, space, time, or the various angles that once determined whether our press releases got used or not.

Social media may have changed the way the game is played, but one thing hasn't changed: We don’t own Facebook. Mark Zuckerberg does, and he makes the rules. 

This comes as a surprise to some—Facebook feels like ours. It’s our page, our group, our feed. We can do anything we want!

Maybe not, as we were reminded last year when Facebook tweaked its News Feed algorithm to feature more information from friends and less from publishers and organizations.

As Facebook stated in its News Feed values: “Friends and family come first.” Organizations, like ours, came second, or lower.

We were reminded of this again in October, when Facebook did a full roll-out of its Explore Feed.

The Explore Feed is a place where you will find links such as pages, groups, events, photos and more. It appears on the left hand side of the page. (As in the image at the top of this post.)

It's a place where Facebook is putting pages—posts from the media, and some organizations and non-profits (if the pages of my Explore Feed is anything to go on).

The roll-out became big news in the tech and media world this month when Facebook did a test in Sri Lanka, Bolivia, Slovakia, Serbia, Guatemala, and Cambodia.

In those countries, all content from media publishers was bumped to the Explore Feed, without warning, instead of appearing in the regular News Feed of people who liked their pages

The result? Since almost nobody pays attention to the Explore Feed, interactions with posts from those publishers fell by two-thirds.

This caused panic in those countries, and also in other places.

Was Facebook about to move all organizational and brand content to another feed? Was this an effort to force groups to pay if they wanted to appear in the regular News Feeds of users?

Facebook responded that it was just a test, and it has no plans to roll it out further. And maybe that's the case. Or maybe not. After all, they make the rules, and the rules could change.

Now, to be fair, Facebook is in a battle to keep our News Feeds relevant and safe from fake news and assorted promotional and advertising content we don’t want to see.

There are plenty of organizations, businesses and groups (hello, Russia!) trying to game the system to get in front of our eyeballs.

If Facebook isn’t careful, our feeds will be dominated by junk. If that happens, we will stop using it. And Facebook doesn't want that to happen. Their business model depends on attracting more people to their platform.

So: Where will this end up? I have no idea. I don’t believe Facebook wants to alienate businesses and non-profit groups by forcing them into places nobody bothers to go. Like the mainstream media of old, it needs us to provide good, relevant content that people want to see.

But at the end of the day, Facebook will do what’s best for Facebook—not for groups like ours.

So as we create social media strategies, hire social media staff, and build budgets around Facebook (and other social media channels), we always need to remember the main rule: We don’t own these channels.

And we don’t make the rules.

Number One Obstacle to Change for Newspapers (and Non-Profits?): Organizational Culture

"It is difficult to get someone to understand something when their salary depends on them not understanding it."

Internet guru Clay Shirky is famous for his statement about the state of newspapers today.

In his seminal 2009 essay Newspapers and Thinking the Unthinkable, he wrote that people committed to saving newspapers would often ask him: “If the old model is broken, what will work in its place?”

To which he replied: “The answer is: Nothing. Nothing will work. There is no general model for newspapers to replace the one the internet just broke.”

But that doesn’t mean newspaper editors aren’t trying to find the “thing” that will save them.

Recently, the World Association of Newspapers and News Publishers asked its members: “What is the single most important risk to a news organization’s future success?”

The answer? Reluctance to innovate.

The number two answer was finding a new business model—which is related to innovation.

And what is the main thing they need to do to be innovative?

Change their organizational culture.

“Getting all staff to share to embrace and share new ideas, techniques and strategies to keep the newspaper alive and exciting,” said one editor.

Change is Hard for Non-Profits, Too

This report is about newspapers, and their future, but it applies equally as well to other media, businesses and organizations—including non-profits.

As many of us know, changing a culture is hard. It’s doubly hard when revenues are falling—as they are for many newspapers and some charities—and resources are tight, as they are for most organizations these days.

And if change means some people might lose their jobs, then it’s even harder.

As American writer Upton Sinclair observed: "It is difficult to get someone to understand something when their salary depends on them not understanding it."

Nobody votes to eliminate their job, in other words.

In my world of international relief and development, a conversation is beginning about the need to collaborate more, or even merge.

It might make economic sense, and even enhance the mission and allow groups to raise more money and help more people.

But if you merge three NGOs, you only need one executive director, one financial officer, one director of communications, etc.

See where this is going?

But back to the report and the future of newspapers.

After changing their culture, what practical things did leaders of newspapers think they should do?

The number one priority was video, presumably because more and more people are watching videos online.

What is not clear to me is whether people want to watch news video, or whether they prefer cute animals and pratfalls.

That’s also the conclusion of Joshua Benton, director of Neiman Journalism Lab.

In an interview, he said:

“I am 100 percent prepared to be wrong about this, but I think many publishers’ continued investment in video will prove to be a waste of time and money . . . the accurate belief that people love consuming video doesn’t mean people love consuming news video.”

I would say the same for non-profits and, for my sector, NGOs. Just because people like watching video doesn’t mean they will like watching our videos.

One last thing newspapers say they should be doing more: Investing in social media.

Ultimately, it may not matter—in North America, at least. 

If, as a recent study found, a majority of Canadians say they can live without a daily newspaper, and ad revenues keep dropping, newspapers may simply run out of runway.

One day the expense line will rise above the revenue line and it will be over.

Or maybe, just maybe, something new will emerge, something nobody has thought of before.

We can only hope—for newspapers, and maybe for the non-profit sector, too.

You can read a summary of the World News Publishers Outlook 2017 here.

Can you Live without a Newspaper? Almost 9 out of 10 Canadians Say Yes

Could you live without a newspaper?

86% of Canadians say yes.

That information comes from a survey conducted in June by Abacus Data.

According to the survey, almost 9 out of 10 people in Canada say they’d be fine if their local newspaper went out of business—they’d still be able to get all the news and information they need.

If Canadians aren’t turning to newspapers for news, where are they going?

Facebook.

In another survey conducted by Abacus in 2016, they found that 21% of Canadians turn to Facebook first for news.

Altogether, a total of 41% of Canadians go online for breaking news, either to social media or a news website—not to print.

For people ages 18-29, that figure is 69%, with 43% turning to Facebook first.

It’s a generational thing, in other words. While 40% of those aged 60 and over read a printed newspaper each day that number falls to just 10% of those aged 18 to 29.

24% of people aged 18-29 never read a newspaper. 25% might check one once a month.

“If you want to get a story or opinion in front of a Canadian audience, you need to make sure you’re making it available to consumers in an attention-getting and engaging way on Facebook,” Abacus says, noting that 82% of Canadians use it to read news stories.

The challenge of Facebook is that the range of knowledge tends to narrow for people who use it as a main source of information.

As Abacus discovered, only 28% of younger Canadians report using Facebook to follow a broad range of topics. 51% pursue only what interests them.

Older age groups are more likely to keep up with a variety of topics.

With Facebook’s algorithms designed to cater news and information to each user’s unique interests, this means the likelihood of them encountering new ideas or stories is limited.

As Abacus put it: “The resulting reliance on Facebook as a primary source means users are getting a limited world view and a limited set of opinions that most closely match their own (confirmation bias).

“To get messages and stories to reach a wider untapped audience, organizations need to be creative with organic online activities and clever with paid online activities.”

(Interestingly, 19% of Facebook users say they follow charities on that platform, which is a good bit of news for non-profits. 10% say they follow religious organizations. The trick is how to get them to like and then share information sent to them.)

Many will lament this situation, but there’s no going back.

Says Abacus: “Offline breaking news sources are being eclipsed by digital news sources as generational disruption and widespread use of social media and mobile technology radically alters the news and information landscape.

“The change we are witnessing is moving so quickly that we anticipate within another five years, how Canadians consume news and information will look nothing like it did two decades before.”

And you won’t find that in a newspaper—if you can find a newspaper at all.