How Business Travelers Contributed to USA Today's Decline
Even in an industry accustomed to bad news, the recent cutbacks at USA Today exposed a harsh reality: For many former readers, newspapers have become so passé that it's become hard even to give them away.
Last month, the Gannett-owned publication announced it was laying off about 130 people, shifting its emphasis from its iconic print edition, and devoting more resources online. USA Today has experienced a sharp circulation drop, even among people who get the paper free -- the business travelers who make up more than half of its readership.
As road warriors know, copies of USA Today have become almost as ubiquitous as Bibles and little shampoo bottles in most hotels. For years, Gannett has maintained distribution agreements with major lodging chains, which leave complimentary copies outside guestroom doors each weekday morning.
The problem is that a lot of travelers nowadays simply aren't bothering to bend down and get them.
"People will pick it up from in front of their door only because it's kind of strange just to step over it," said Steven Carvell, a Cornell University professor of Hotel Administration. "But they're not being read through."
Last year, Marriott International -- in the name of "reducing waste" -- announced it would discontinue automatic newspaper delivery in more than 2,600 hotels. Customers at about 400 full-service Marriott properties nationwide still can ask for a USA Today to be brought to their rooms. (They also can request a local newspaper or the Wall Street Journal, which is aggressively trying to skim off what's left of the hotel newspaper business.) At the limited-service hotels that make up the bulk of the Marriott portfolio, such as Courtyard and Residence Inn, free newspapers now are available only in the lobby.
By Marriott's count, the new policy reduced USA Today's paid circulation by about 50,000 copies a day, worsening a decline the publication had experienced because of the slow economy and a nationwide drop in business travel. (While the newspapers are given to guests free, USA Today can count them as paid circulation because hotels purchase them at a bulk rate and technically pass along the cost to customers as part of the room price. The fine print on hotel bills often notes that a 75 cent or dollar newspaper charge has been included in the room rate.)
A changing ritual
When Marriott announced the policy change last year, it said demand for free newspapers had declined 25 percent. "I visit more than 250 hotels a year, and more often than not, I'm stepping over unclaimed newspapers as I walk down the hallway," explained Chairman Bill Marriott, Jr., who sounds far less enthusiastic about USA Today now than he did when he personally appeared in a 1984 television ad promoting the then-new publication.
In that era when USA Today was an ambitious and brashly-colorful upstart, Marriott was the first major hotel chain to partner with Gannett and deliver the paper to guest rooms. The practice quickly spread through the travel industry and played a big role in the publication's early success, giving USA Today a strong following among upscale business people. As the newspaper forged additional bulk sales arrangements, travelers could find free copies of USA Today in airport club lounges, inside their rental cars, and in all but the most basic hotels.
"It was sort of the business travel ritual," said writer Tim Winship, a former manager of Hilton's frequent guest program who now blogs at frequentflier.com. He said the free newspapers were a popular perk with hotel customers, and he himself often pored over his USA Today for almost an hour as he ate his room-service breakfast. "It was kind of a comforting thing," Winship said.
Not surprisingly, the newspaper ritual became less prevalent as hotels began rolling out another, more modern amenity: high-speed Internet access. In-room broadband connections -- an expensive novelty just a few years ago -- have become standard at virtually all of the nation's chain hotels, and free at many of them. Winship said he now spends mornings on the road reading the news on his laptop computer.
And as for the newspaper outside his door?
"I usually just kick it inside when I go out in the morning," Winship said. "Then, when I come back, I bend over and put it in the trash can."
News 'strapped to my hip'
Surveys have found that the vast majority of business travelers carry laptops, while the use of smart phones (which don't require a hotel Internet connection) has skyrocketed among frequent hotel guests even faster than in the rest of the population. A July study by PhoCusWright, a travel industry research firm, concluded that 75 percent of regular business travelers carry devices such as BlackBerries or iPhones. A separate Pew Research Center report in July found that 38 percent of the general adult population uses mobile devices to access the Internet.
"When you look at the demographic of business travelers, they are becoming younger," said PhoCusWright research director Carroll Rheem. "They're used to consuming their news from digital media."
A Marriott spokeswoman said she had no immediate information on how many guests pick up free newspapers in hotel lobbies or still request them to be delivered to their rooms. But it's clear that some guests remain loyal to the print editions. On flyertalk.com, a discussion forum for frequent travelers, more than a dozen regular Marriott customers responded positively when I asked, "Do you read your free newspaper"?
"I find them very nice to have and [I'm] lost without 'em," wrote IT consultant Matt Nevans, who said he saves two days' papers to read on his flights home. "It's nice to have something to do on the plane during 'no electronics' time." Another traveler expressed a similar preference for low-tech reading material in a place equally ill-suited for electronics. "I like to start the morning off reading the paper while relaxing in the Jacuzzi," he wrote.
On the other hand, several respondents said they read the complimentary Wall Street Journal when it's available, but not USA Today. And a handful said they refuse all newspapers when they check in to the hotel or ignore them if they're delivered to their room. "The best source for any news is strapped to my hip 80 percent of any waking day," said Los Angeles software engineer Kenneth Crudup.
New digital initiatives
Indeed, as Gannett puts more emphasis on its digital products, its challenge is to create a prominent online destination for all those hip-strapped devices. Deprived of the competitive advantage that comes with being the only newspaper outside a hotel guest's door, USA Today hopes to hold on to its traditional readers by producing mobile content related to travel, aviation, technology, and other subjects. To continue to reach Marriott customers, Gannett has partnered with the lodging company to promote USA Today's iPad app. It also has begun displaying USA Today content on large touch-screens in hotel lobbies.
It's uncertain whether such digital initiatives will help replace USA Today's lost circulation among business travelers. But Carroll Rheem, the travel industry researcher, said hoteliers are likely to embrace technology as a cheaper alternative to the labor intensive practice of distributing dozens of newspapers to guest rooms each morning. Rheem said it's not unimaginable that within a few years, complimentary newspapers may go the way of other once-common hotel amenities, such as free matchbooks and coin-operated vibrating beds.
"Consumers expect to consume news on the road just as they do at home," Rheem said.