Monthly Archives: July 2011

Lt Gen William Caldwell Beats the “Rolling Stone” to Dust

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General William B. CaldwellSometimes mistakes do get corrected.  Back on March 9th I wrote about the case against Lt. Gen William Caldwell, a very old associate of mine, who was covered by  Rolling Stone.  The accusation against him was that he had run a rogue operation attempting to brainwash visiting government officials and elected representatives into supporting the mission in Afghanistan.  Coming on the heels of the article that forced the removal of Gen McKristol for his, and his staffs remarks denigrating their President.

I spoke in defense of LTG Caldwell because I knew him, and I thought I understood what had taken place.  I was right, or at least the Army and of its’ investigators thought so as well.  He was acquired of all charges and will continue in his role heading up the training of Afghans for U.S. and NATO commands.  This is a big tough, and thankless command for any senior military officer.

The good news here is that a good man had his reputation restored.  After all the press comments after the Rolling Stone article I felt he would need a lot of luck to achieve a positive outcome…and he had it.  A career of stellar and exemplary service will continue.  We are all the better for this outcome.

For everyone else undergoing a trial of their reputation should take notice and heart.  Good things can happen to good people – even when a reporter from Rollng Stone is asking you questions.  Good can prevail!  This time it did.  His dad, my former boss, must be smiling from above.

The Philly Tipping Point for Newspapers

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Printing Presses for Profits or Boat Anchors?

In a switch from talking about direct mail, there is breaking ‘news’ in the print and newspaper arena that deserves prompt attention.  Yesterday it was announced that the Philadelphia Media Group that owns the joint venture papers Philadelphia Inquirer and the Philadelphia Daily News are planning to launch low-priced Android tablets for subscribers later this year.  This is a real tipping point for newspapers.

In the article “Reinventing the Newspaper” in the recent edition of The Economist they lay out the challenges for newspapers, and how we got there.  We have been following the path of the existing print journalism model, mostly advertising based, suffer through years of revenue decline and shrinking pages counts.  The model sprang forth in 1833 with the launch of the Sun in NYC as a mass audience newspaper with a small price of one penny.  Within two years circulation of the Sun eclipsed the existing papers Courier and Enquirer on a 3-1 ratio.  The path was set.

Newspapers have been the dominant player in print advertising until just recently.  I worked in the field for more years than I want to admit, and I know first hand how hard it is for change to come to the newspaper field.  Ad revenues have declined significantly since 2000 down 36% according to Alan Mutter in his Reflections of a Newsosaur – required reading for those of us lamenting the decline of the field.  In his July 5 post “Why Newspapers Can’t Stop the Presses” he gets to the heart of the revenue issue.  Digital advertising in newspapers is generally an extension of the print advertising buy.  Very little is digital alone, and the fear is that with no print buy, there would be no real digital revenue.  As a percentage, digital growth as been dramatic – in real dollars, not so much.  Not enough to support current newspaper staffing models.  Drop print and die is the reality.

This is where the Philadelphia model could have a real impact on the overall newspaper model.  If they can grow their subscriber base and attract new subscribers, especially younger subscribers which are a very small niche market at current, they could have found the golden path to the future.  By offering readers with subscriptions they might have found the answer.  As I stated earlier, this could be the ‘tipping point’ which could signal the direction they need to go – to stop printing.  Print and distribution is very expensive on a daily basis, with electronic delivery the savings would be huge, and could be the savior they need to find to stay relevant.

 

The Crisis Being Delivered to You Daily – Part 2

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Apple Postage StampIn my last post I discussed the problems of the USPS, their pension issues, and their overall solvency.  These issues could lead to higher rates, or major cutbacks in services.  Why is this happening?  Like any business, and just like the rest of the whole communications arena, including all print media, and telephonic services – the model has changed.  Without major changes the legacy media and the USPS will not survive.

How did this happen for the USPS?  Over the last several decades US mail volume increased dramatically with the growth of advertising mail as a significant tool for marketers.  The USPS begrudgingly adopted the model, after significant foot dragging through the 70’s and early 80’s, when they did everything they could to make it difficult for large scale ‘junk mailers.’   When they realized that more of their profits came from advertising mail than first class they adapted.

The adaptation they took was vastly expanded “automation” this included major investments on their part with huge investments in sorting equipment to reduce their costs while speeding the mail out to meet projected delivery schedules.  They succeeded and continue to refine this process with more equipment and the cooperation of the mailing industry.  This took the form of better mailing processes at the printers and mailers to ensure that all mail was automation ready.  For this they offered postage discounts as incentives to mailers, a great bargain.  This continued until today when we find ourselves in a whole new world.

In the late 90’s email began eating into the marketing arena, and in the later years first class mail saw declines as more people began paying their bills online, and that was followed by businesses supporting that habit with online billing.  What was a two step process – bill out and remittance back – being dropped.  This has been a big blow to the USPS.

Advertising mail volumes have dropped – mainly due to costs and a change in habit – social has taken their bite of the USPS apple.  Mail is very effected, but relatively costly per piece.  Online marketing is much less costly, and provides almost immediate feedback in both results and analytics which helps to quickly adapt programs to changing niches and markets.

We live in a different world today.  The USPS adapted in the 70’s and 80’s with automation of physical mail with great results.  Today that is not enough.  Our new digital marketing tools and social marketing have totally changed the marketing pardigm.  Legacy marketing – mail – will continue to be relevant, but will also continue to shrink in volume.  The USPS which has made major investment in automation, but still has a large work force with government pensions, will need to shrink – both in size, and services.  The Benjamin Franklin model of universal service at a uniform price might not work in today’s digital and social world.  Get used to it.  “The check is in the mail” will be dropped from our lexicon within a decade.

More to follow….