Walter Erbe is the kind of local advertiser that daily newspapers need to survive. Now, he’s mad, and that spells trouble.

The general manager of Samy’s Camera, a Playa del Rey-based chain with six stores in Southern California, has long been buying full- and half-page ads in the Los Angeles Times, and some of those have brought as many as 1,000 customers per week to his stores in L.A.’s Fairfax district, Culver City, Pasadena and Santa Ana.

But now, alarmed over ever-deepening cuts at the Times including the recent announcement that the paper would eliminate its local-news California section come March 1 Erbe is considering pulling most or all of his remaining ads.

“It sucks. It will absolutely cause us to rethink our advertising strategy,” Erbe said. “With the California section closing, the paper is getting thinner and thinner, and the already dwindling number of people the Times reaches will dwindle even further. At some point, you have to wonder, are people still going to buy the paper? Will our ads reach anybody?”

Erbe is far from alone in re-evaluating his company’s advertising strategy. As the Times, the Los Angeles Daily News and other daily newspapers have undergone round after round of cuts over the last five years and circulation has continued to slide, advertisers all over the region are reconsidering their ad choices.

“If we haven’t already passed the tipping point where print media no longer makes sense for advertisers, then we’re very close to that point,” said Sanjay Sood, associate professor of marketing at the UCLA Anderson School of Management.

Sood said daily newspapers like the Los Angeles Times are in the midst of a vicious descending loop. As advertising revenues fall, newspapers must cut the size of their papers and staffs to bring costs into line. But that drives away readers, which in turn causes advertisers once again to pull back, perpetuating the cycle. The recession, he said, is accelerating the downward spiral.

Late last month, as he announced another in a series of layoffs, Los Angeles Times Publisher Eddy Hartenstein announced that the paper was eliminating its California section to cut printing costs. Local news stories will be folded into its front section.

Keeping advertisers

Scott McKibben, Times chief revenue officer, defended the cuts in a statement to the Business Journal and said the publication will work to keep advertisers on board.

“The same challenges that face the companies the Times reports about are also affecting us and we need to implement changes to both our flagship print edition, and throughout our organization, that will ensure our future,” McKibben said in the statement. “We’re working closely with all our advertisers and have heard from many who understand and support the changes we’re undertaking.”

Amid continuing and greater than expected revenue shortfalls, as well as staggering debt, the Times’ corporate parent, Tribune Co., filed for Chapter 11 bankruptcy protection in December.

The Los Angeles Newspaper Group of newspapers run by Dean Singleton’s Media News Group Inc. empire is also struggling with revenue decreases and staff cutbacks. The chain includes the Daily News, which serves the San Fernando Valley; the San Gabriel Valley Tribune; and the Long Beach Press-Telegram.

Five years ago, Galpin Motors Inc., one of the oldest and largest car dealer chains in the San Fernando Valley put 80 percent of its advertising budget in print media advertising, mostly in the Daily News and Times, said marketing manager Jeff Skobin.

Today, that figure is 20 percent and it’s continuing to shrink. The dollars are moving to Internet and broadcast.

“A lot of this has to do with the lack of effectiveness of the papers,” Skobin said, noting that only 10 percent to 20 percent of customers cite the print ads in the Times and Daily News as their reason for coming in.

Most of Galpin’s customers cite online services, such as CarsDirect.com Inc. or BeepBeep.com, as their reason for visiting. (One online car service, Cars.com, is jointly owned by five media companies, including Tribune.)

Skobin added that Galpin, which sells multiple car brands at sites in the San Fernando and Santa Clarita valleys, is taking a wait-and-see attitude toward the most recent announcement from the Times about the elimination of the California section.

“We’re going to do some more customer surveys and if we see the numbers drop from print media ads, we’ll cut once again,” he said.

But Galpin is also pressing for lower ad rates.

“The Times and the Daily News must bring their ad prices in line with their reduced readership,” said Vice President Beau Boeckmann, son of current owner Burt Boeckmann.

Calls to Daily News marketing manager Bill Van Laningham were not returned.

Open question

At Santa Monica-based Enterprise Fish Co., a restaurant chain that has been advertising in the California section of the Times, the future of print ads is an open question.

“With the closing of the California section, we’re going to move to another section of the paper and see how effective that is,” said operations director Christina Choi. “We’ve been getting at least three or four customers a day from that ad. If that falls off, we’ll reconsider our options.”

Choi added that in the current situation, she would be “very hesitant” to sign a yearlong print advertising commitment.

Where else is there to go?

“In general, other forms of advertising, like local cable television or radio, are more expensive than print media, while the whole online advertising world is probably new to traditional retailers,” marketing professor Sood said. “Most challenging of all, for most of these businesses, they will have to divide up their ad dollars among several forms of advertising.”

Given these daunting choices, it’s no wonder print advertisers are pushing hard for better deals including more favorable placement and online spots from local newspapers.

“They are absolutely seeking lower ad rates. It’s quite clear that newspapers are becoming less efficient and are not the reach vehicle they used to be,” said Debbie Sklar, vice president and director of print services for New York-based media buyer Horizon Media Inc.

But not all local advertisers are taking such a dim view of local dailies. Some say that despite all the problems, newspapers remain a very effective way of reaching a large number of potential customers in a given region.

For example, Hawthorne-based electronics retailer Ken Cranes Inc. plans to maintain its current advertising levels in both the Times and Daily News.

“I don’t see us walking away from print advertising,” said Vice President Pam Crane. “For local retail, newspapers are still a very important vehicle. We strongly feel when people go to shop, they check our print ads with our competitors’ ads. As long as the papers continue to be delivered to our doorsteps, Ken Cranes intends to be part of them.”

But Ken Cranes seems to be an exception. More typical is the position taken by Westwood-based Bel Air Camera, which has been consistently scaling back its ad commitments with local print publications.

“Other forms of advertising, like targeted mail and event promotions, now offer more bang for our dollars, so we’re taking a greater and greater portion of our advertising away from print,” said operations manager Barry Dennis.