Rupert Murdoch’s Wall Street Journal is making a major play for local this year. The newspaper has hired a large, capable staff (disclosure: many are my former colleagues from The New York Sun) to create a New York focused arts and culture section. The section won’t debut until the Spring, but when it does, chances are, it could take a large chunk of The New York Times’ advertisers with it.
Why? Because luxury advertisers are often based in New York or targeting its residents and they are more likely to reallocate their ad budgets than increase them in the coming year.
According to AdAge, both Bergdorf Goodman and Bloomingdale’s will advertise when the Journal’s New York section debuts. Both advertisers currently have big commitments to The New York Times. Bloomingdale’s spent $17.9 million in the Times last year (and less than $1 million at the Journal). Bergdorf reportedly spent $1.4 million with The Times and nothing at the Journal. That ratio could easily shift when The Journal starts going after the New York arts community more aggressively. From AdAge:
“Bloomingdale’s operates stores around the country, and the Times has a
healthy national distribution — so it’s not clear that it’s just the
paper’s strong city distribution feeding that disparity. But Bloomies
also has many stores concentrated in the New York area, so when it’s
time to advertise in that particular region, which it does, the
Journal’s Metro section may give the chain a reason to reexamine its
allocation of spending.”
Given the state of the traditional retail industry, the stores are not likely to increase their advertising budget to accomodate the Journal’s new section, but move it from the Times to the Journal. While the Times has one of the most well-respected arts sections in the country, it is more nationallly focused than specific to New York (even though New York receives more coverage than other locations).
The Times often depends on its mass scale when it comes to attracting advertisers. Scott Heekin-Canedy, president and general manager of The New York
Times tells AdAge:
“The Times’ distinctive New York coverage — government, politics, the
courts, fashion, styles, the arts, culture, education, business and
more — commands a deeply loyal and engaged print and web audience in
New York and is almost three times the size of the Journal’s.”
But due to budget issues, The Times has been cutting back on New York coverage. Last Spring, the paper closed its stand alone City section and many of the writers have since left the paper.
As publishers struggle with paying for local coverage, advertisers are making a more granular focus on specific audience targeting. The Journal is not likely to bankrupt the Times when its new section debuts, but if it can draw a good sized group of wealthy, arts (and shopping) focused New Yorkers, advertisers will come running.
Image: WSJ magazine