Message from Scott Smith - Trb Pub President

From: [Tribune Publishing president] Scott C Smith

Sent: Mon 7/16/2007 2:24 PM

Subject: Revenue Growth Initiatives

Colleagues:

As you know, we are taking action on many fronts to reverse revenue declines that are impacting us and the entire newspaper industry. Revenue for Chicago Tribune Media Group was down 7% in the second quarter. June declines were less and we are committed to further improving trends in the second half of the year. Growth initiatives range from reorganizing ad sales to better match local and national client opportunities to aggressive product development, including the launch this week of the next generation of chicagotribune.com. We also need to add other new offerings to better serve changing consumer and advertiser interests.

In this light, we will soon add section front advertising on the Main News, Sports and Tempo sections of the Chicago Tribune. We will begin selling these premium positions at premium prices for brand and image advertising to key clients this week. These color ads will be 1 1/2 inches deep across the bottom of these section fronts. This is a common ad size across the industry and will be common across Tribune newspapers to attract more business from national advertisers. They will also be sold locally, generating millions of dollars of new ad revenue in total.

I made the decision to expand section front advertising, including on the front page, weighing the interests of both readers and advertisers in the context of our overall goals. Readers highly value display advertising in their newspapers. Based on the rigorous guidelines we have established, I'm confident that the kind of high quality advertising content you see on the front of the Wall Street Journal can be a net plus for readers, as well as the advertisers seeking to reach them in engaging ways.

Please keep in mind that section front ads are not a new concept. TheTribune for many years carried multiple ads on page one and the recent section front ads on other sections are going well. We haven't sold them every day yet as we're holding to the premium prices these ads should command to generate revenue commensurate with their value. Importantly, everyone can continue to count on high-quality journalism throughout the Chicago Tribune, and be confident that the news, including on sections fronts, will be edited and presented entirely independent of the advertising.

If you have any questions or comments on this growth initiative, please share them with managers in your department or me. We also welcome your suggestions on other growth opportunities and I look forward to seeing many of you at the Transform Tomorrow Town Hall meetings over the next 10 days.

Best, Scott

SOURCES: LAObserved and Romenesko