Local Newspaper & TV Still Use Failing CPM Model

Some (too many) local news sites are still practicing outdated methods of pricing their ad inventory. Specifically, the CPM or cost per thousand model of online pricing. A recent article in the Wall Street Journal highlighted this crisis via the explosion of news sites and the Ad inventory contained within, along with automated ad exchanges that promote commodity pricing.

We still scratch our heads as to why most Newspaper conferences and big name consultants avoid these discussions. To date, those in charge at many TV, Radio & Newspaper companies don’t even have this stuff on their radar.

From American Press Institute website:

“Ad buyers and industry executives say the proliferation of new sites and automation in ad sales is driving down advertising pricing—by as much as 70% in some cases—making it tougher for sites to turn a profit from traditional online advertising. More news sites means more ad space is available,” writes William Launder. “People don’t appreciate how difficult it is to do interesting journalism that is monetizable and sustainable over time,” said Jim VandeHei, the president and CEO of Politico and Capital New York. “We would never build a media product based around [web] traffic and advertising. That is a fool’s play in this day and age,” VandeHei tells Launder.

As dozens of news websites proliferate, ad dollars are stretched thin (Wall Street Journal)

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