Free 'shoppers' going to town in the neighborhoods

The publishing industry's "sleeping giant" is waking up. This is the way Jim Crosby, president of the National Association of Advertising Publishers (NAAP), describes the tremendous growth of free-circulation papers, especially "shoppers," over the past 10 years.

Shoppers are a local phenomenon. They look like newspapers, but their content is 80 to 100 percent ads and classifieds. Their target is home delivery to everym household in a given neighborhood. According to statistics from NAAP, the umbrella organization for roughly one-third (or 700) of the country's free-circulation papers, shoppers reach 95 to 98 percent of their area's households; 90 percent or more of those households read their shopper regularly.

It's hard to imagine that something the American public gets for freem can actually turn a buck. In fact, many shoppers are highly profitable. That's because every week at least 18 million Americans reach into mailboxes or unhook plastic pouches from front doors and bring a shopper into their living room. And it almost seems as if every week some new shopper is hitting the doorsteps or some large news-media group is buying one up.

Retailers and neighbors are the shopper industry's best advertisers, but only because a shopper has the capability of "saturating" an entire community. "Neighbors will place classifieds and readm classifieds, if making contact means only having to go down the street to a garage sale or notm having to make a long-distance call for a used car," the manaer of an Arizona shopper says.

"Because many shoppers offer zoning, advertisers can pinpoint exactly who they want their ad to reach. If they advertise in a large daily metro, they are paying more to reach people who might live hundreds of miles away," says Dick Gossett of a Wichita, Kan., shopper, Pennypower.

Since shoppers court mostly the retailer, the meat market around the corner, or the neighbor placing an ad for a Friday-night baby sitter, they don't very often step on the toes of the large dailies. Occasionally, however, the competition for ads between subscription papers and shoppers gets tough.

"We get in a dogfight from time to time," says Mr. Crosby, whose two shoppers lured Des Moines's two major grocers away from advertising in the Des Moines Register and Tribune.

Dave Tibbetts, advertising director of the Register and Tribune, says shoppers are just another competitor to be aware of. "Everyone in this business is in competition with TV, radio, billboards . . . even matchbook covers."

The history of many successful shoppers has been to start in a small community and then "spread like an amoeba" to surrounding communities. The Pennysaver in Tempe, Ariz., has a similar history.

In 1972 the shopper was carrier-delivered to 14,000 homes. Gradually it spread west until its circulation covered most of Phoenix, filling in holes where no shoppers were.

Pennysaver's George Johnston calls Phoenix "the fastest-growing spot in the United States. As more people move to the SouthWest, more retailers and businesses open up. Where they go, we go."

Apparently, where they were "going" was right into the arms of a major media firm, Cox Enterprises Inc., which bought the shopper 3 1/2 years ago.

More and more large media groups are finding it advantageous to add shoppers to their list of publications. Those already active in this area are Harte-Hanks Communications Inc.; the Post Corporation; Capital Cities Communications Inc; and the Tribune Company.

Jack Egan, general manager for Pennysaver, says shoppers are being bought up because "they are a cost-efficient method of getting advertisers into the marketplace." He reasons that a paper doesn't have to put up with editorial expenses to attract ads.

Shopper publishers also say media groups buy shoppers to fill districts not covered sufficiently by subscriptions to their newspapers.

The Tribune Company, based in Chicago and moving swiftly into the shopper scene in Florida, challenges this last reason. "Shoppers are a level of publishing offering good financial terms . . . offering excitement and dynamics. [Our growth] is definitely a move toward diversification, not supplementation," says Robert Dickey, advertising manager of the Chicago Tribune and former vice-president of the Tribune's Sun Coast Publications in Florida.

Every year since the Tribune bought its first Florida free-circulation paper in 1975, it has bought up or started a shopper. Mr. Dickey says the Trib now owns 16 free-circulation publications in Florida, circulating to 500,000 homes.

"Up until about two years ago, shoppers had a bad image nationally. The fact that a majority of owners now reside in corporate board rooms brings stature to the industry."

So says Roger Miller, former NAAP president and now owner of a Brattleboro, Vt., shopper.

Local advertising and classified are still pretty much the lifeblood of shoppers. But in the struggle to get more ads, many shoppers are trying to convince national advertisers that free weeklies are a worthwhile advertising medium. This, Mr. Miller says, is one reason "our image" is so important.

To try to shake such national suspicion, more shoppers are having independent researchers audit their circulation. "Auditing gives advertisers a guarantee that we circulate to as many people as we say we do," Miller says. But there is certainly room for improvement. Only 47 percent of NAAP members are audited.

A sure-bet trend, in the eyes of Miller and NAAP executives, and one of the biggest improvements, is the addition of local news to many shoppers. Weekly calendars of community events and gardening tips have come to be permanent parts of many shoppers, but those in the forefront of the industry allude to more than this.

In April 1979, three Bostonians sniffed the potential of shoppers with news. Richard Wousoufian, Stephen Cummings, and Russel Pergament started out with a shopper serving Brookline and Newton, suburbs of Boston. Business grew -- so did letters from readers stating they wanted more than ads.

"We began with spot editorial items," Russ Pergament notes. "Our front page now has no ads at all. Many of our stories have been picked up by Boston's newspapers and TV stations." They call their company Tabloid Newspaper Publishers Inc., and this fall they expect to expand into Cambridge and Boston.

But a free community newspaper/shopper isn't enough for them. In June of last year they began two publications: The TAb Home Report and The Tab Fashion Report. These are free, four-column magazines, in color, devoted to fashion and home care. This combination of 50 percent ads, 50 percent news comes out monthly to 100,000 homes.

"We send these reports to wealthy towns and neighborhoods close to shopping malls," Pergament says. "Advertisers like Bloomingdale's; Shreve, Crump and Low; Filene's; and Saks are our steady income."

But won't a shopper be better off if it can sell allm its space to advertisers? Isn't it less costly if there's no editorial staff to support? "It all depends on the marketplace," Pergament says. "We now have a real commitment to editorial excellence. We discovered our community just wouldn't respond well if there wasn't local news in their paper."