Increased competition for advertising dollars is driving new deals and sponsorship strategies in the newspaper category.

In one of the category’s most recent deals, USA Today Sports Media Group recently announced a five-year partnership with the PGA Tour. The tie affords access to PGA Tour intellectual property and the right to develop several Tour-themed special sections over the course of each year of the agreement.

The key sponsorship driver for the category: generating advertising revenue.

Print and online newspaper advertising fell 7.3 percent in 2011, according to the Newspaper Assn. of America. That follows a 6.3 percent decline in 2010 and 27.2 percent drop in 2009.

As a result, newspaper publishers are increasingly moving away from pure-play trade deals with sports teams, community festivals and other types of properties in favor of integrated packages that offer access to salable inventory.

“We strive for a 35 to 40 percent net profit margin on every event,” said Haley Carlson, the Tribune Co.’s events and sponsorships manager.   

According to IEG SR’s annual property survey, newspapers are the most active media sponsor with 14 percent of properties reporting a partnership with at least one newspaper.  Television stations are the second-most active with 11 percent followed by radio stations (10 percent) and magazines (1 percent).

Case Study: Milwaukee Journal Sentinel
Like other newspaper publishers, the economic fallout in 2008-2009 and the subsequent pullback in advertising spending forced the Journal Sentinel Inc. to reevaluate its sponsorship portfolio.

The company trimmed its portfolio in favor of a core group of properties that offer direct revenue generating opportunities.

“We were generally open to all sponsorships, but as the economy changed we had to become more selective and focus on partnerships that best suit our business objectives,” said David Wise, the Journal Sentinel’s marketing director.

The paper’s two primary objectives: driving circulation and advertising revenue.

On the advertising front, the Journal Sentinel uses sponsorship to create promotions that can be sold to sponsors and advertisers.

For example, the paper this year is leveraging the MLB Milwaukee Brewers with Know the Pro, a weekly poster insert that highlights team players. Froedtert & Medical College of Wisconsin will sponsor the insert for the 2012 season.  

The program helps the paper accomplish its two primary goals, said Wise. “Consumers buy the paper to get the poster, and it also generates direct advertising revenue.”

The Journal Sentinel can only secure advertisers from existing Brewers sponsors, said Wise, noting that the team would not allow non-sponsors to ambush existing partners.

In a similar vein, the Journal Sentinel is activating Milwaukee’s Summerfest music festival with Land the Big Gig, an American Idol-themed national talent search that dangles $45,000 in prize money and a new Hyundai Veloster.

The newspaper has secured Boston Store and the retailer’s Mambo Australian sportswear line as the promotion’s co-presenting sponsor. The clothing line gains exposure in more than $1 million worth of media including a presence on www.LandTheBigGig.Com.

Other sponsors include Bryant & Stratton College; Marcus Hotels & Resorts; Robert Haack Diamonds and Boucher Hyundai, that latter of which is providing the Hyundai Veloster for the promotion.

Unlike the newspaper’s partnership with the Brewers, Summerfest allowed the paper to secure partnerships with non-sponsors. With the exception of Boston Store and Marcus Hotels, none of the other advertisers sponsor the festival.

“Summerfest allowed us to work outside their existing relationships except in categories where sponsors have exclusivity,” said Wise.

Tips On Selling The Newspaper Category
Below, IEG SR offers tips and tactics on selling newspapers:

Offer publishing and sales rights. In keeping with their focus on boosting the bottom line, a growing number of newspapers look for the right to produce and sell event programs and special supplements.

For example, Advance Publications, Inc.’s The Oregonian leverages its long-running partnership with the Safeway Waterfront Blues Festival presented by First Tech Federal Credit Union by publishing and distributing the festival’s program.

The newspaper offsets the cost of the supplement by selling ads to Safeway, Inc. and other event sponsors, said Clay Fuller, festival producer with the Oregon Food Bank, the festival’s beneficiary.

Similarly, The New York Times Co. activates the ING New York City Marathon with a marathon-themed supplement distributed in the paper on the day following the event. The supplement lists the names and finish times of runners that cross the finish line under five hours.

The newspaper sells ads in the supplement to both sponsors and non-sponsors, although sponsors receive the right of first refusal.

“We give our partners the first opportunity,” said Ann Crandall, executive vice president, business development and marketing strategy with New York Road Runners, owner of the ING New York City Marathon.

The New York Road Runners is working with The New York Times to explore the possibility of selling race memorabilia through the paper, she added.

Help promote online and digital offerings. With nearly every paper expanding their digital presence, newspaper publishers are increasingly using sponsorship to promote their online offerings.

Case in point: The Journal Sentinel is co-presenting Land the Big Gig on behalf of Tap Milwaukee, the paper’s online entertainment portal. The newspaper launched the Web site last year with a stage sponsorship at Summerfest.

Engage newspaper editors. Newspapers frequently use sponsorship to promote music, food and other editors.

For example, the food editor from Cleveland’s Plain Dealer will select talent for a sponsored stage around the paper’s sponsorship of the Fabulous Food Show at the International Exposition Center.

The event uses the editorial tie-in to gain additional promotional support.

“We give the editor ownership of the stage, which puts something in his pocket. He’ll conduct interviews and write up celebrity chefs, which gives us additional promotional support,” said Steve Volchko, corporate partnership manager with the I-X Center, which owns and hosts the event.

Provide on-site sales opportunities. Most newspaper publishers look for on-site sales rights for single-copy papers and opportunities to solicit subscriptions.

The Journal Sentinel solicits subscriptions at NFL Green Bay Packers games, while The New York Times sells copies of the ING New York City Marathon special-edition at the event’s post-event activities.