Angels Target Latinos; McEnroe Featured in New Lincoln Spots
The three months ended March 31 was one of the most challenging quarters in Irvine-based Freedom Communications Inc.’s history, according to a company newsletter.
“Never has the bottom dropped out of ad sales as fast as it has in a number of important market areas for Freedom,” said Sam Wolgemuth, the company’s president and chief executive officer, in his May column.
The news illustrates overall pressures continuing to face publishers throughout Orange County and the nation.
According to Wolgemuth, Freedom’s first-quarter sales were 6% ahead of the first quarter of 2000, but that included businesses the company did not own last year. Without acquisitions, he said, Freedom would have been 7% short of last year’s sales.
Cash flow also saw a dip. According to Wolgemuth, with company acquisitions, Free-dom’s cash flow was off by 16% for the quarter vs. the year-ago period. Subtracting what was generated through new businesses, he said, cash flow was off by 36%.
The main cause: a big drop in advertising, which makes up more than 90% of Freedom’s revenue, according to Wolgemuth. He said three sectors were hardest hit: automotive (car companies are among the top advertisers in Freedom newspapers), technology (the core market of many Freedom magazines) and help-wanted (a high-profit area for newspapers overall).
But Freedom is not alone when it comes to the ad struggle. Across the board, a slowed economy has car and technology companies tightening their belts,and slashing ad budgets to save money.
The fallout has affected not only newspapers and other publishers, but advertising agencies as well. OC shops have watched budget-conscious clients cut chunks of business, causing several agencies to trim back on staff.
Newspapers, however, also face another hurdle: rising paper costs, which may be taking a breather.
Wolgemuth said that two of Freedom’s paper suppliers announced a partial rollback of the price increase imposed on March 1,a sizeable savings to Freedom, which will consume more than 200,000 metric tons this year.
Still, Wolgemuth said that Freedom won’t get to “budget victory on savings alone”,it needs a boost in advertising.
“In a number of places, ad sales show signs of improvement,” Wolgemuth said. “That’s not by accident. Freedom is blessed with great sales teams and they work hard at it.”
Though it appears “less and less likely” that Freedom can achieve “its budgeted goals for the year,” according to Wolgemuth, “many of our businesses can still reach their objectives.”
Angels Team With OCTA
The Anaheim Angels and the Orange County Transportation Authority recently teamed to target OC’s Latino community,and drive more fans to the ballpark.
The outreach program, which will continue through the rest of the baseball season, involves radio, newspaper and bus advertisements in both Spanish and English.
The promotion highlights the Angels’ Latino baseball players and offers a special program on Sunday home games sponsored by the OCTA and the team. Fans can get a free roundtrip bus ride to Edison Field from the Santa Ana Transit Terminal and a discount ticket coupon that can be traded in for a $7 upper view game ticket.
“Our objective is to reach out to our Latino fan base in Orange County and encourage them to attend our games,” said Kevin Uhlich, the Angels’ vice president of sales and marketing and baseball operations. “If the program proves successful, we would like to expand it to other areas.”
This is another attempt by the Angels, which has lost money each year under Disney management, to turn declining attendance figures around. Attendance has dropped for the past three seasons, going from 2.5 million in 1998 to 2.3 million in 1999 to 2.1 million last season.
As part of the new campaign, a Spanish-language Angels’ advertisement will be wrapped around an OCTA bus and feature photos of several Latino ballplayers, including Benji Gil and Ramon Ortiz. The promotion also includes interior bus card ads, exterior bus ads, fliers and promotions on the Angels and OCTA Web sites.
The size of the campaign was not disclosed.
Lincoln Lands McEnroe
Tennis champion John McEnroe has signed on to promote Irvine-based Lincoln, the official sponsor of the U.S. Open tennis tournament.
A new television campaign, created by Young & Rubicam Inc. in Irvine, was recently launched and will run through the end of the summer. Two 30-second spots, themed “Tennis the Way It Ought to Be,” were filmed at the United States Tennis Association National Tennis Center in New York. Each spot features McEnroe and a different Lincoln vehicle: the Navigator sport utility vehicle and the LS sports sedan.
Deborah Wahl, Lincoln’s marketing communications manager, said McEnroe, a talented player known for his colorful outbursts on the court, is a good fit with the car company, which pushes “luxury without rules.”
Billings for the campaign were not disclosed.
