THE $1 BILLION LADY
Byline: Eric WIlson
NEW YORK — “Colorful. And fat.”
That’s how publisher Arthur Sulzberger Jr. describes today’s New York Times, rather than “old” or “gray,” as the lady used to be known.
Eight months after a redesigned Times landed on doorsteps and desktops around the nation, with color pictures and graphics, new sections, later deadlines and a lot more to read, its executives boast that the overhaul has gone so well, the paper this year will become the first to generate more than $1 billion in “real-dollar” advertising.
Last year, the Times sold $989.48 million worth of ads, $10.5 million short of its goal, Sulzberger said. For the first quarter of 1998, revenues were $261.3 million. Advertising was up 17 percent last year and up about 10.5 percent this year on a year-to-year basis as of last week, said Dan Cohen, senior vice president of advertising.
“We’re obviously well on our way,” Sulzberger said.
Thus, when he described the Times as “fat,” Sulzberger was speaking of more than just the girth of the newspaper, which, after increasing from four daily sections to six, has clearly put on a few pounds.
“It’s doing extremely well,” said Mary Ann Winter, manager and senior media analyst at Brown Bros. Harriman, who credited an increase in national advertising for improving the Times Co.’s outlook.
Winter said 54 percent of Times advertising comes from national ad sales, which is a highly profitable venture for the paper.
“The bottom line is that they are bringing in a lot more national advertising because of the distribution of the paper,” she said. “It’s a little too early to tell whether the investment in color has paid off, but in less than a year, 8 percent of their advertising revenue is coming from color advertising.”
A year ago, the Times could at best produce a daily edition of 128 black-and-white pages in four sections. But after a $1 billion investment in printing technology and two color presses, what Sulzberger described as “a 10-year plan that began in 1987 to re-create the New York Times for the next generation,” the Times can print a 160-page color edition in six sections using two press runs.
That investment was made with the idea that the Times had to bring in new readers to reenergize its circulation. Times watchers ponder whether the decision to bring in so many sections — Science, House & Home, Dining Out and Circuits among them, not to mention two Weekend sections plus Automobiles on Friday — was made from an editorial or advertising stance.
The answer seems to be both. Six sections provide the Times with 50 percent more “face-offs” and back pages, prime real estate in advertising that sells at a premium compared with the Times general open rate for a full page ad, which is around $80,000.
It also provides editorial capabilities the Times never had before, Sulzberger said. Sports used to be folded into the back of the Metro section, for instance, but is now a daily pullout like sports sections at many other major daily papers, making it easier to get at. Later deadlines allow the paper to print more results of late-night games.
“That sports was folded into the Metro section suggested to too many of our readers that we didn’t take sports seriously,” Sulzberger said.
Circuits — designed as a “section to help all of us through the digital revolution, the next major part of the industrial revolution” — was the first to be introduced in the Times national edition and is credited with driving up national advertising sales.
“Clearly we wanted to insure any new section we introduced or an old one we revitalized would be profitable,” Sulzberger said. “But we also wanted to make it more reader-friendly.”
The general perception among some readers, or at least their first take, is that there’s too much to read.
“We have heard that a lot,” Sulzberger said, with the caveat that in focus groups, readers have quickly warmed up to the new sections.
He also said complaints from readers are dwindling and that the backlash is similar to what happened after the last major redesign of the paper in the Seventies, when the Times went from two daily sections to four.
Sulzberger is bullish that the $1 billion investment will continue to reap rewards for the company, which has reported 30 percent earnings growth over the past three years.
Total daily circulation was 1.11 million as of March 31, 1998, up from 1.10 million a year earlier, while Sunday circulation was 1.65 million, up from 1.64 million, according to unaudited figures pulled from the publisher’s statement to the Audit Bureau of Circulations.
Sulzberger said his only disappointment continues to be diminishing readership within New York City.
“We are not suggesting that we are making the Times an easy read,” Sulzberger said. “It is a challenging read, and we expect our audience to stand up to that challenge. That’s one reason we do so well. We train people for 20 to 25 years on how to read the New York Times. When we change it, there’s a natural discontinuity.”