Few can deny the industry smarts that Warren Buffett’s got. Chairman and CEO of Berskhire Hathaway, owner of nearly 30 dailies, he knows newspapers. What’s more, he’s confident and encouraged about the importance and profitability of the industry, especially in smaller communities.
This may surprise some, but not others. He’s mentioned more than once that newspapers have an important position. And if not, he certainly wouldn’t continue investing in them.
In 2012, Berkshire Hathaway only owned one newspaper. But they knew they were buying more. Twenty-six more, in fact. In a letter to publishers and editors, Buffett explained his position — ”Berkshire buys for keeps.” And so it was that he did buy those 26 newspapers, and more.
SEE ALSO: What Buffett Thinks of the Future of Newspapers
Moving forward, in a November interview with Tom Walsh for the Detroit Free Press, Buffet was asked a simple question, ”How are you feeling about the newspaper industry these days?” He told Walsh that Berkshire Hathaway had purchased four ”good-size newspapers” in 2013, and that they would buy more.
But where is all of this feel-good belief in newspapers coming from?
Smaller Might be a Lot Better
Buffett’s confidence isn’t without parameters. He notes that newspapers are well suited to mid-size cities, stating towns like Greensboro, NC and Tulsa, OK as examples. Major metropolitan areas might have the potential for more subscribers, but they are missing some of the advantages available to mid-size or smaller ones.
In smaller towns, newspapers have a strong tie to the community, or at least they can if they cultivate it. Buffett thinks they must be their go-to source for news.
Cutting Back is a Bad Idea
With profit margins in a precarious balance for many newspapers, the bottom line might get more attention that the paper, itself. And Buffett warns that’s not a good strategy. ”The idea of selling less and less for more and more is not a winning system.” He says Berkshire Hathaway publications will not go that route.
His position remains as it was in 2012, when he explained that if a newspaper offers less, readers will respond with less interest. It’s not the same as cutting back on potato chips in a bag and selling it for the same price or even more. A chip is a chip. But if readers aren’t getting relevant news, there’s no reason to subscribe.
No One Knows Your Audience Like You Do
Relevance is tougher in the digital age. Where once local papers provided local news, plus state, national, and international, they no longer have that niche in the community. This means focusing on home-town topics is even more important. Sports, events, social life, and anything that’s specific to your community belongs in your paper.
To be relevant, offer something that readers can’t get anywhere else. And only you know what that unique thing is. If readers already know your headlines before you go to print, because they’ve seen them online, you’re not offering a service. So reporting — real reporting out in the field — is where you’ll get what you need.
No, newspapers aren’t dead, and they aren’t dying. The soil conditions for growth have changed, and like any crop, you have to adapt to reap the harvest that you want. If you’re enthusiastic about a new course, it will show through in the news that you produce. But if you’re not, that will show through as weak copy. It’s all in how you approach it.
Warren Buffett has carried a lifelong love of newspapers. He delivered them when he was younger, he’s read several newspapers every day throughout his life, and now he’s acquiring more and more in an effort to help them take fight again.
He knows that smaller towns have the advantage of community focus. And you should know that, too. If you believe it, and make a commitment to digging in to give your neighbors something they can’t get anywhere else, your newspaper will gain, or regain, the sort of relevance that a big-city paper could only read about.
Warren Buffett image credit: By Mark Hirschey (Work of Mark Hirschey) [CC-BY-SA-2.0], via Wikimedia Commons
