Insufficient national advertising forces Hearst to put a halt to Diversión…

King Features, a unit of Hearst Corporation, announced that it will not launch Diversión, a million plus weekly insert set to be distributed in 13 newspapers in the top 10 Hispanic markets. The launch was originally planned for the end of the first quarter of 2004. “In recent months, it became clear that national advertising revenues wouldn't support the launch,” sources at King Features told Portadatm.

The venture had a first year revenue goal of between $7 and $10 million. King Features' president T.R. “Rocky” Shepard III was counting on one-order/one-bill national print media ad buys to attract advertisers, especially in the grocery, telecommunications, furniture/apparel, footwear, retail and transportation sectors (see “Hearst to publish weekly Spanish supplement in major newspapers,” page 1 Portadatm No. 5 September/October 2003). CPM's charged to national advertisers were to be between $25 and $75 depending on the position of the ad.

Sources at King Features added that the Diversion project has given Shepard and the rest of the team members “valuable insights about how to best serve the publishing needs of the U.S. Hispanic community. We are quite confident that these insights will lead us to launch new initiatives in the future.” Sources added that the concept behind the Spanish-language entertainment supplement remains viable. “In fact, it could emerge again under a different business model.”

...national advertisers take a “wait and see” approach

“The planned launch of Hearst's Diversión project coincided with some of the most important changes Hispanic newspaper publishing has seen so far,” Félix Sención, CEO of New York based Sensación Marketing, told Portadatm. Sensación was hired by King Features to handle national advertising sales for the Diversión insert.

In Sención's opinion many advertisers are waiting to see which distribution models will be most sucessful with the Hispanic/Latino market. “The big question is who is going to win the daily newspaper fight,” Sención added. Currently Tribune Corp. is launching its Hoy-brand in several cities nationwide, with a total market coverage (TMC) approach in some cities. A number of general market newspaper chains are also launching new dailies. The Diversión insert project would have relied on the distribution networks of its thirteen partner newspapers. In the current state of flux in the Hispanic newspaper industry, this dependency on third party distribution might have seemed too risky to national advertisers.


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