Newspapers have long said that businesses must advertise to survive - but they've been reluctant to follow that advice.
Until now.
The new owners of The Inquirer and the Philadelphia Daily News, and their Web site, Philly.com, pledge to spend at least $5 million to advertise and promote their new property, for which they paid $515 million on Thursday.
That kind of spending - about 1 percent of total revenue - still pales in comparison with many industries. But it is fairly unprecedented in the newspaper business - despite sluggish ad sales and falling circulation.
Will it be enough to lure new readers and advertisers to two newspapers and a whole industry widely perceived as, well, yesterday's news?
Brian Tierney, the perpetually optimistic chief executive officer of the partnership that now owns the region's biggest news organization, is undaunted.
"That's why I did this deal. I see such opportunity," he said. "I think I can make this place hot again."
Where investors and others see high costs and competition from national Web sites, television and bloggers, Tierney sees two newspapers - and a Web site of their own - with a long tradition of journalistic excellence in one of the country's largest markets.
The $5 million in promotional spending is just a start, he said, estimating that it could soon reach more than $10 million.
Those numbers would likely make most newspaper publishers' eyes pop. The Inquirer and Daily News spent about $200,000 annually to raise their profile in the pre-Tierney years. Those Lilliputian numbers are not unusual in the industry.
Such tightfistedness has contributed to newspapers' declining readership and influence, according to many who have studied the industry.
Many industries facing stiff competition would advertise. Newspapers have instead focused on design, new ways of storytelling, or subscription discounts.
"For the most part, newspapers do a terrible job at marketing themselves, so any attempt is an improvement," said Mike Smith, executive director of the Media Management Center at Northwestern's Medill School of Journalism. He studied four companies considered to be among the world's best marketers: Puma, Unilever, Nestle and Pfizer. They spent 14 percent to 36 percent of their total revenue on marketing.
Tierney's promised $5 million in promotional money is a gigantic increase from the past and a departure from industry practice, but it still represents a fraction of what many consumer companies spend. In 2005, revenue at Philadelphia Newspapers Inc., the former parent of The Inquirer and Daily News, was $493.6 million.
Tierney said promotion and advertising were so antithetical to the industry's traditional thinking that when he asked executives at other newspapers for examples of successful promotions, they rarely could think of one.
"At times, I shake my head at how not just us, but how poorly I think the print industry has promoted itself," he said.
Industry executives have started working to change their fuddy-duddy image. They are touting growth in online readers and revenue instead of just dwelling on declining print circulation. The Newspaper Association of America recently made use of research showing that consumers seek out ads in newspapers. That characteristic distinguishes them from many other media, such as television, where consumers try to fast-forward through ads, said John Kimball, chief marketing officer for the Newspaper Association of America.
This spring, the group incorporated such data into an advertising campaign to convince businesses that newspaper ads work. The campaign helped Mike Lambert, advertising research manager for the Virginian-Pilot in Norfolk, Va., hold on to two accounts that were worth a combined $4 million to $6 million in yearly ad revenue.
In a survey of about 4,600 adults by Scarborough Research, 86 percent said they saw an item in a newspaper insert and then went to the store to buy the product.
But Ken Doctor, lead analyst with Outsell, a media research company, and a former vice president for the digital arm of Knight Ridder Inc., a previous parent of The Inquirer and the Daily News, doubts that promoting the industry's attributes will solve bigger challenges.
"I think it's a limited answer to a long-term problem, and the long-term problem is all the choices people have in terms of news and information," he said.
For example, many sports fans now turn to Major-League Baseball's Web site for in-depth coverage and video of their favorite teams and players. That competes directly with newspapers, to which sports has long contributed circulation. So far, newspapers have largely failed to offer the depth of statistics and video that MLB and other sites offer.
"Associating a new level of promise or promotion with the products, that's great," Doctor said. But the more important question, he said, is whether "the product really delivers what it is that consumers want."
Tierney said he was already working on ways to figure that out. He has met with executives at Google and Yahoo "to learn what these really, really smart guys are doing." Eventually, he hopes those talks will lead to joint business efforts.
He also plans to hire a "chief creative officer" from outside the newspaper industry to figure out new advertising formats and "take a look at everything we do."
But for the near-term, he is sticking with time-tested sales pitches. Street teams from the newspapers will distribute soft Frisbees that bear the logos of The Inquirer, Daily News and Philly.com at the Shore and at a gospel performance today at the Mann Music Center. On Friday, Tierney threw a pep rally for employees; Mummers strutted, and Tastykakes and hoagies were served.
And some of the sales pitches will be literal: Tierney will throw the first pitches at Riversharks and Phillies games this week.
Contact staff writer Miriam Hill at 215-854-5520 or hillmb@phillynews.com.
