Loss-making 'Tribune' running out of time

MEDIA AND MARKETING:Informal approaches about 'Sunday Business Post' merger believed to have been rejected

THE SUNDAY Tribunejust made it past its 30th birthday last November but now it looks like curtains after their main financial backer Independent News & Media (INM) decided this week to cease funding the paper.

Receiver Jim Luby of McStay Luby has been tasked with finding a buyer for the business. INM had been quietly sounding out potential buyers in recent months without success, so it appears unlikely that a white knight will emerge now.

It is believed informal approaches were made to Thomas Crosbie Holdings about a possible merger of the Sunday Tribunewith the Sunday Business Postbut TCH wasn't interested.

Though INM committed to funding staff costs until the end of February, the paper will not be published this Sunday. A concern for Mr Luby is that the receiver might be liable for a libel inadvertently published in the newspaper while the business is under his control.

The paper has been bailed out before and, with three decades of publishing, the Sunday Tribunetitle has a value. But this time any potential saviour faces a very different newspaper landscape to that of the 1980s. Circulation – currently around 40,000 – has been dented by competition from The Sunday Timesand the Irish Mail on Sunday, and as circulation has dropped advertising has become a harder sell.

Although managing director Michael Roche cut the cost base from €16.5 million in 2004 to €7.5 million in 2010, the operating loss is believed to be around €40,000 per week.

With falling circulation and declining ad revenues, the problem facing the Sunday Tribune is market-driven. An example of the challenge facing Roche was the decline in property advertising from €2 million in 2007 to an estimated €35,000 last year.

Since becoming a 29.9 per cent shareholder in 1992, INM showed a lot of commitment to the title. Accounts for Tribune Newspapers plc show that at the end of 2009 the deficit in shareholders funds was €59 million.

The Independent group is not as flush as it used to be and faced with having to stump up another €2m to nurse the Sunday Tribunethrough 2011, they decided to pull the plug.

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Home shopping through television is a big global business, with two of the biggest stations, Home Shopping Network and QVC, generating a combined $10 billion in sales every year.

The nearest thing Ireland has is City Channel, whose schedule is adorned with infomercials. RTÉ also devotes some airtime to the concept, in various time slots before dawn on RTÉ One.

Some of that programming is put together by Kathy Hoffman, who brands her slot “Shopping From Home”. And the slot is proving popular with many small and medium-sized Irish companies such as Peats Electronics, who pay Hoffman to sit on the sofa and chat about their products. Contact details then appear on the screen for viewers who want to buy.

RTÉ’s commercial department gave Hoffman the go-ahead for the project on the basis that it would be self-financing. Initially, Hoffman sold the ad slots herself but now she employs a full time sales person employed.

The programme is recorded for Hoffman by Shinawil, the independent production house. The cost of a five-minute advertorial slot starts at €5,000 for a four-week run. According to Hoffman: “The advertisers approve their footage so they are fully involved. We also provide a phone-answering and fulfilment service if the advertiser wants that.”

The programmes pull an average quarter-hour audience of 3,500 viewers, most of whom are early-rising housewives. Across a full month, the total audience ranges from 100,000 to 250,000 viewers.

A new edition of Shopping From Home is broadcast on the first day of every month and is on air for the full month. But with just one show a month, Hoffman knows she is missing out on sales opportunities such as Valentines Day and Easter. She says she is talking to RTÉ about increasing the frequency to two shows a month.

Meadows & Byrne used the show to advertise a €98 footstool and sold out their stock. Electronics retailer Ben Peat is a regular advertiser on the show and says he has seen a marked increase in footfall and online sales since getting involved.

Other advertisers include Odearest which has sold €799 beds on the show, Unislim, Fota Island Resort, Slendertone, Champion Sports, Fitness4Hire, Proactive and Eyesential.

“Eyesential approached us after the director Ed Tomlinson saw the programme on TV in his hotel room when he was over here on business. He has an Irish operation here and that’s why we work with him. We only work with companies that operate in Ireland,” says Hoffman.

Siobhan@businessplus.ie