By Jake Rossen
By Jesse Marx
By Michelle LeBow
By Alleen Brown
By Maggie LaMaack
By CP Staff
By Jesse Marx
After taking a few days to "cool off," Nelson wrote a response to Lundy's accusatory letter and sent it to his former publisher Rick Sadowski. The confrontation fizzled. "It was puzzling," Nelson reflects. "You'd think I'd committed felony murder rather than quit my job. In the end it only served to make me angry. Now I just want to kick their ass on the page."
On February 25, a mere three months after hiring away Rick Nelson from the Pioneer Press, the Star Tribune added insult to injury, unveiling a "bigger, better" Thursday food section, featuring ten full-color pages filled with articles about local restaurants and specialty shops, gourmet cooking, and fine wine. It was an obvious response to EAT!--and Nelson facilitated its design and wrote the cover story for the debut edition.
The venture is representative of the Star Tribune's new, long-term strategy to attract affluent readers with sections tailored to non-news interests. "Now that we're owned by McClatchy, we're focusing more on core newspaper initiatives," asserts Ben Taylor, the paper's vice president of marketing. "Currently, we're repositioning the Taste section. There will be two more similar initiatives this year. With Taste we did extensive research on who was reading the product, who wasn't, and why. Then we did a very careful segmentation of the market.
"We've carefully researched what will grow circulation, and we've looked at the local-news option and others," Taylor continues, in reference to the Pioneer Press's foray into zoned editions. "And while I think local news is a very important thing, from a promotional standpoint it's not something we'll be pushing. We've got better things to push."
When Tim McGuire spoke to his staff the day after the Pioneer Press scooped the Star Tribune, the editor acknowledged that it wasn't "fun to have such a meeting after you get creamed on a story." But rather than dwell on the preceding 24 hours, the editor opted to gaze into the near future, when Taste's demographic reach will be augmented by two other profit-oriented revamps: At the end of April, McGuire announced, the Star Tribune's sports section will be pumped up to provide more coverage of smaller local events and offer a user-friendly format akin to the paper's Variety section. And in the fall the Strib is slated to debut a weekly entertainment-oriented tabloid section designed to attract younger readers.
That McClatchy, still a neophyte in the Twin Cities market, is already willing to make a play for the Uptown crowd--something Star Tribune pop culture editor Tim Campbell has been talking about for years--speaks volumes about the company's first year of ownership.
At the paper's annual all-employee meeting on February 16, members of the corporate hierarchy could barely contain themselves. Themed "Own the Road" and held at the Lutheran Brotherhood church a few blocks from the newsroom, the hourlong presentation exulted in the financial successes of the past year and looked to the future with cheerleaderlike verve. Dressed in Hawaiian shirts and carrying surfboards, members of the advertising department strolled across the stage as publisher John Schueler enthused that the "Circ's up!" McClatchy CEO Gary Pruitt, a boomer executive with a penchant for the Rolling Stones, quoted songs he'd heard the night before at the band's Target Center show: "It's all right now, in fact it's a gas!" he quipped, swiping at Wall Street analysts who a year earlier had predicted that McClatchy would regret paying so much to become the nation's eighth-largest newspaper chain. To cap off the event, honchos confirmed a plan to invest five million dollars in the paper's already state-of-the-art printing plant, and all eligible full-time employees were given a $472 bonus.
It had been a heady year, to be sure. In large part because of the falling cost of newsprint, McClatchy managed to rapidly knock down the debt it had incurred by buying the Star Tribune; instead of being well over one billion dollars as had been predicted, the figure currently stands at $960 million. That means the company's cash flow is five times larger than the interest it must pay on the debt. If the Star Tribune continues to produce 37 percent of McClatchy's revenue, CEO Pruitt believes, the debt load will fall another $100 million in 1999.
Most pleasing to Pruitt has been the paper's strong circulation gains over the past three quarters. For the first time in five years, readership increased: up 3.3 percent to 400,362 from Thursday through Saturday, and up four-tenths of a percent to 671,000 on Sunday. Steve Guida, who until recently served as the Star Tribune's vice president of circulation (he just started a new job at US Bank), says McClatchy wants daily circulation to reach or exceed 400,000 Monday through Friday, and Sunday's count to increase to 700,000 by September 2001.
To achieve these numbers, Guida admits, the paper will have to both solidify its metropolitan base and attract new, well-heeled readers in the suburbs. And although neither he nor Pruitt will come out and say it, outside the Twin Cities metro, projected growth in both population and income is highest in counties just east of St. Paul. In other words, the way to bulk up on readers with disposable income is to sell more papers in the competition's back yard.