1 of 2
After achieving average revenue growth of nearly 40 percent each of the past four years, Deseret Digital Media now produces more than one quarter of the revenue of the entire media business, including print and broadcast.

SALT LAKE CITY — Two years after launching a major restructuring, the Deseret News has staked its ground as a strategic leader in a newspaper industry still struggling with revenue and readership, according to a new study by the Pew Research Center’s Project for Excellence in Journalism.

Based in Washington, D.C., Pew's Project for Excellence in Journalism is one of the nation's leading research centers for the study of journalism. The Deseret News was one of four newspapers identified by the project for a report on news organizations that are "revenue success stories."

This recognition comes on the heels of the Deseret News being identified as the second-fastest growing news publication in the nation by the Alliance for Audited Media.

The study itself follows on a Project for Excellence in Journalism report issued last March that portrayed an industry in a state of inertia, still heavily dependent on print revenue even as that revenue fell off sharply.

By 2011, newspaper ad revenue nationally had fallen to half of where it stood in 2006, the project reported. And newspapers were not making up print losses with digital gains, losing $7 in print revenue for every $1 gained in digital.

“Frankly we were besieged by people who wanted to know if there was anything worth sharing,” said Mark Jurkowitz, the lead researcher on both reports.

Among the stories Jurkowitz found worth sharing was how the Deseret News and its sister organization, Deseret Digital Media, have defied national trends by increasing digital revenue growth and print circulation.

The other case studies in the report are of the Santa Rosa (Calif.) Press Democrat, the Naples (Fla.) Daily News, and the Columbia (South Carolina) Daily Herald, with each paper contributing a distinctive possibility to the mix. The Press Democrat, for example, is building a separate revenue stream with a Media Lab that offers a wide array of marketing services to local businesses.

The report cites the Deseret News for two key innovations — improving quality coverage by focusing its editorial voice and separating the digital business from the legacy newspaper.

Editorial emphasis

Responding to the rapid demise of print advertising revenue after 2008, the Deseret News hired new leadership determined to drive change that better matched the changing landscape. This led to a strategic redirection in 2010, including staff cutbacks.

Clark Gilbert leads the current management team. Jurkowitz calls Gilbert “one of the most visible thinkers” in the industry. Gilbert is a former Harvard business professor who, early in his career, collaborated with Harvard’s disruptive-innovation guru Clayton Christensen in studying how to reinvent the newspaper industry, alongside other industries threatened by technological change.

One of the keys to reinventing the Deseret News under Gilbert's direction, the report concluded, was a commitment to focusing coverage on issues and topics where the paper enjoyed strong comparative and competitive advantages.

The Deseret News redirected resources away from areas that are not unique — such as style, arts and city politics — and focused instead on quality content that builds on the editorial strengths of the paper while targeting audiences that the paper feels no one else is properly serving.

“In the case of the Deseret News,” the report states, “the response was not only to shift the focus of coverage from general interest to faith and family, but to dig deeper into those topics with more ambitious, enterprise reporting.”

According to Doug Wilks, managing editor for the news division of the Deseret News, digging deeper means "reporters look at what matters to Utah's families by approaching each story with layers of inquiry that provide the context for important community issues."

Wilks, who joined Deseret News after 13 years with a New York Times Regional Media Group paper, points to recent local coverage where "we questioned deeper at the Legislature and in our schools; we identified trends and provided context on criminal behavior and police response. And we're always looking for solutions to the problems we identify."

The paper now focuses heavily on six areas — faith, the family, financial responsibility, education, care for the poor, and values in the media.

“You have to make tough choices about what you want to do if you want to play on the national landscape,” said Paul Edwards, editor of the Deseret News. “If smaller organizations are going to thrive in the digital space, they have to be known for a certain approach, a certain tack.”

"We want to own (coverage of) faith and the family the way the Washington Post owns politics," Gilbert said.

In addition to shifting emphasis, the Deseret News is looking to raise its profile by spreading its reach, Edwards said. The first half of this effort is a new national edition of the paper, with in-depth reporting in the six areas of emphasis. The other side of the strategy is to syndicate the content, building partnerships with news websites looking for quality reporting on rarely addressed issues.

Both the national edition and syndication efforts are still in early stages of development, and the national edition website is scheduled to come online late this spring.

“Few papers have the opportunity to gather a national or international audience around a set of shared values in way the Deseret News does,” said Rick Edmonds, who researches media innovation at another journalism think tank, the Poynter Institute in St. Petersburg, Fla.

“The point is to take an audit of your strength and your opportunities,” Edmonds said, citing another paper that is building a brand around in-depth coverage of a local professional sports team with a national following.

Digital differentiation

But editorial focus is only part of the story. “News has never been a good business by itself,” said Chris Lee, president of Deseret Digital Media. “It’s a mission. It’s a brand builder. But it isn’t the way that anyone is ever going to make money.”

Indeed, one of Gilbert’s boldest moves, the Project for Excellence in Journalism report noted, was to separate the print newspaper from the online digital product — separate businesses, separate staff, separate revenue streams.

“The legacy business is the crocodile,” the report stated, summarizing Gilbert’s philosophy, “the prehistoric creature that will shrink, but can survive. The digital business is the mammal, the new life form designed to dominate the future. And they need to be managed apart.”

Gilbert did this by splitting the Deseret News from Deseret Digital Media. The latter now includes the websites for KSL radio and television, the Deseret News website and handful of other smaller subsidiaries.

Making money from digital news remains a conundrum, said Edmonds. “One of the difficulties is that digital advertising is really hard to grow with plain vanilla banner ads. There are so many other places advertisers can turn, and many are more naturally targeted to specific audiences. So the rates keep falling.”

Edmonds called Craigslist “the leading edge” of a shift that took newspaper classified business down to 1/5 of its size. “Google search had a lot to do with it. (And) there are other competitors for digital advertising,” he said.

He also noted that many businesses that formerly relied heavily on newspaper ads now spend a lot of money on building their own websites and a creating direct digital shopping experience.

“New audiences have responded well to smartphones,” Edmonds said, "but advertisers are not really sure yet what works best on those platforms.”

In an industry where dwindling print revenue continues to dwarf struggling digital contributions, the Deseret News and Deseret Digital Media stand out. After achieving average revenue growth of nearly 40 percent each of the past four years, Deseret Digital Media now produces more than one quarter of the revenue of the entire media business, including print and broadcast.

A big part of that success is the KSL marketplace, a classified section that pre-empted Craigslist locally and now dominates the classified market along the Wasatch front.

Other innovations come from launching digital-only sales channels, creating digital services for small- and medium-sized businesses and creating a travel site through ventures like utah.com and saltlake.com.

“I don’t know of any other efforts to take the metro daily to this level," Edwards said. "It’s pretty audacious, actually. But it’s gratifying to see some lift."

Eric Schulzke writes on national politics for the Deseret News. He can be contacted at [email protected].