Chicago Tribune to cut 80

The irony of losing Verdi is that he didn't leave for ESPN.com, he didn't get ousted because of cost cutting .... the genius sports editor at the time RAN HIM OFF!

 

Is that how it went? My memory is fuzzy on this, and I sometimes mix up whether it was a genius SE or a genius ME who ran off a) Verdi, b) Bayless, c) Lincicome. Recall Gene Wojo. writing something that derailed him there and Rosenbloom was out of his depth from jump street as essay columnist. Holley missed Boston and Wilbon had much sweeter deal in Washington that only has gotten sweeter. Hey, whatever happened to Steve Daly (going back a couple of decades here)?

Underwhelming track record there, given resources and market. Start layoffs with the responsible decision-makers.

 

One of the few members of the Never Read A Bad Story With His Byline Club.

Read his stuff in Golf World. Never a whiff to be seen.

 

Here's an update from the other side of the newspaper business, an ad person who got the Zell out in March:

http://www.tellzell.com/

Friday, July 11, 2008
An Ad Man's Lament

Since Sam Zell took over, editorial side folks have kvetched (No! Not journalists!) about how Zell is ruining newspapers. But it turns out that they aren't the only ones with complaints. With little notice, Zell has radically revamped the advertising side of the Tribune, too. And he hasn't had much success there, either.

Below is a guest post from a former Tribune sales manager who took the March buyout. Since Zell took over, the manager says, the ad force has become dispirited and desperate. First, Zell eliminated salaries and put everybody on 100% commission. The new system caused ad reps to discount the price of full page ads by up to 70% just to make sure they were bringing in commissions, i.e., their mortgage payments.

Making it even harder, Zell cut funding that generated goodwill and brought in sales—paid memberships to local chambers of commerce, for instance—a pennywise, pound foolish strategy. Finally, in cutting reporters, he has cut the content in local sections that the ad guys sell against. Who wants to buy an ad inside a B-section composed only of AP stories and community listings?

The manager's analysis closely mirrors a similar one recently posted at Newsosaur by Janet DeGeorge, an advertising veteran with her own consulting company. Folks, I know we're supposed to have firewalls between editorial and advertising, but when Zell destroys both sides simultaneously, it's not good for anyone. Here's the full breakdown from the manager:

How Zell Ruined the Three Rs of Advertising

When he took over the Tribune, Sam stated his 3 Rs---Revenue, Relevance and Respect. He has not been true to his plan.

First, Sam stated that he wouldn't cut expenses on his way to growth. Well, we had two reorgs and layoffs in January and February 2008. Sam lost respect. Next, senior managers cut chamber of commerce and community organization annual dues without consulting sales managers. By doing this, you lose advertising. He cut a $500 expense and lost $10,000 in ad revenues. Local business organizations don't support those who don't support them. We probably cut 15 memberships, which equates to $150,000 in revenue. Sam lost revenue.

Second, territory and local category sales reps compensation packages were changed to 100% commission from 70% salary and 30% commission (Sam pays a draw of $1,750 a month against the commission). This works great in a growing market, but not a shrinking market. Each sales rep was given a different percentage of sales, based upon last year, with unlimited upside. Example: If you had $500,000 in sales in 2007, the new plan gave you 10% of sales, so the rep makes $50,000. But if business is down 15% or $425,000, the rep makes $42,500. Great, if you are exceeding last year, but the reality is you are not. Reps are now selling ads at 20% to 70% discounts to just get the business. Thus the full page sale in March 2008 that offered 70% discounts to advertisers. Sam lost relevance and revenue.

Sam also changed the rules so that territory and local category ad reps no longer have protected territories. Other reps from their sales team can call on accounts in another reps' area, without notifying them. It creates lots of friction and looks very unprofessional to the client. I have no problem moving or switching accounts between reps, but do it upfront and professionally.

Finally, editorial has seen the news hole cut by 25 % over the past 3 years, especially in the local news area. Readers buy the newspaper for local news. Studies illustrate that fact. With staff cuts, reporters don't cover local stories in the numbers and depth that they used to. Local and zone sections now have four to five stories in each edition. The rest is lists and stacked ads. Many of the stories are re-runs from other sections that are not relevant to the area. Readers stop reading the sections and advertisers receive poor response to their ad campaigns. Sam has lost relevance and revenue through loss of respect.

 

Holy fucking shit. How did that not get reported until now? Good god.

It's probably just a matter of time until the reporters are paid by the story.

 

On "the ad man's lament:" For all the kvetching we do on the newsroom-side, that may be the single most damning indictment of a newspaper's ownership I've ever seen. Does the man have no fucking clue?
Anyone who's ever even been to a Chamber of Commerce meeting can tell you that not paying Chamber dues is guaranteed to cost you ten-fold in ad revenue. To say nothing of the image that's created in the community by setting your ad reps upon each other like hyenas.
I can understand, a little, not "getting" newsrooms; he's not of our tribe. But Zell's supposed to be a businessman. He looks damn lousy at it.

 

Who talks to ad people?

 

I would think that putting the ad salespeople on 100 percent commission would remove their incentive for trying to sell Web ads -- the rates are far lower and advertisers aren't rushing to buy those spots.

 

Any names (publicly announced, I mean) of those who will depart in the latest round of Chicago Tribune bloodletting?

 

Been out there for months. One of the first things he did.

Counterproductive, like much of the Howard Von Zell's Grand Vision.

 

Re: Chicago Tribune to cut 80 (UPDATE)

Well, only the editor left today:

http://www.chicagotribune.com/business/chi-lipinski-resigns,0,7744968.story

Not everybody likes her, but she's a Tribune lifer, and this isn't good news that even she can't take it anymore.

 

Whatever happened to that former SE there, Margaret Holt? Hate to admit it, but I get Holt and Lipinski confused, only because I know that each tussled with one or more sports columnists.