Rob Bedell thinks humor and happiness go together.
As local manager for the Onion, a free weekly newspaper that satirizes news stories, he has a mission “to make Los Angeles a happier place.”
At a time when most newspapers show declining readerships, the Onion’s performance gives Bedell solid reasons for feeling good. The paper launched its L.A. edition on August 10 with a circulation of 50,000. The company distributes the paper at 1,000 locations, including music stores, coffee shops and newsstands. Although the total circulation number hasn’t grown, Bedell has worked to reduce returns amid phone calls and e-mails from readers complaining they can’t find a copy.
“No question, we’re reaching an audience,” said Steve Hannah, chief executive officer of Onion Inc. in New York. “We know they’re taking papers out of the boxes, but in order to get to know who they are takes time.”
The Chicago and New York editions of the Onion distribute 100,000 copies in their respective markets, and Hannah expects to reach the same level in L.A. His business plan calls for growth of 10,000 copies per year.
“We take a targeted approach, not a blanket approach,” said Bedell, meaning that the Onion distributes to localities heavy in the paper’s target demographic of college-educated, affluent people who are conspicuous consumers and early adopters of technology. Currently, the coverage includes West Los Angeles, Hollywood, Silver Lake, downtown, Santa Monica, Venice, Marina del Rey, and the campuses of local universities. “That’s the audience that gets the jokes,” Hannah explained.
From a profit perspective, the targeted approach makes sense because the more copies a free paper prints, the more expenses rise. Until the advertising revenue can catch up, “increased circulation is only certain of one thing increased expense to produce and deliver,” said Dean Adams, a newspaper circulation consultant based in Canada. “It would not be consistent to presume that because a product has increased circulation that it is successful or profitable.”
Adams lists the biggest challenges in starting a free paper: First, soliciting an advertiser base, and second finding an audience in the marketplace. “Amidst all the other media forms, another free weekly is just more noise in the market unless other factors are present,” he said.
Humor gives the Onion a clear competitive advantage with readers.
“We’re not your standard alternative weekly,” said Hannah. “We don’t intend to come into the market and unseat the LA Weekly. We take a more strategic approach of finding the demographic and finding the outlets near them.”
However, Hannah agrees that the Onion competes with alternative weeklies for ad dollars. In other cities, the Onion revenues split about 70 percent from local advertisers and 30 percent from national brands. In Los Angeles, that skews more national because of support from the entertainment-related advertisers such as movie studios and record labels. National advertisers include BMW, Palm, Sony, Samsung, HBO and Comedy Central, while Bedell cites concert promoter Goldenvoice (AEG Live LLC) and electronics store DXC as local supporters.
As for the cost, a one-time full-color page in the L.A. Onion runs about $2,000. A one-eighth page costs slightly more than $100. Many advertisers show surprise at the low prices, according to Bedell.
At this point, an Onion ad is an intuitive buy Bedell doesn’t expect audited numbers on L.A. readership until September. Kristen Orten, vice-president at agency STG Media Corp. in Phoenix, said that ad buying in alternatives depends heavily on the demographics.
Advertisers that fit with the alternative weekly audience include auto dealers, technology brands, and direct response, according to Orton. “The Onion has always been attractive to bars, restaurants, entertainment venues, but there’s a whole new wave of advertisers we’re attracting now,” said Hannah. Financial institutions, real estate agents and car stereo shops now figure in the Onion customer base.
Although the Onion regularly features articles with four-letter words and jokes about masturbation or genocide, advertisers take it in stride.
“They may not get the humor, but they still see the advantage of being in the paper,” said Bedell. Hannah added that jokes are common in mainstream advertising, and “the kind of advertisers who want to reach our demographic know that young, smart, affluent people like humor.”
However, the Onion draws the line in the advertising department, shunning ads from massage parlors, escort services and strip clubs.
