Auction Figures

At a time when newspapers across the U.S. are facing a shaky future, both in terms of revenue and circulation, a new and innovative sales technique is prompting some advertisers to give newspapers a second look.

In recent years, consumers have flocked to online auctions staged by newspapers, featuring goods and services provided by local retailers in exchange for exposure through the auction and advertising credits they earn if the retailer's items sell. Vancouver, Canada-based CityXpress ( has led more than 500 event auctions for newspapers since 2002, generating more than $100 million in revenue for newspaper companies such as Knight Ridder, Scripps Howard, and the New York Times Company.

"The auctions are especially effective with nontraditional newspaper advertisers," explains Phil Dubois, president and chief executive officer of CityXpress Corp. "Our studies show that roughly half of auction participants are first-time advertisers for the newspaper. Product categories such as electronics, appliances, and furniture seem to perform exceptionally well."

Newspapers like the auctions because they give their Web sites additional exposure. Advertisers favor them because they can help recruit new customers.

"Our studies show that over 30 percent of bidders end up going to the store where the product comes from, with 50 percent of them purchasing, or planning to purchase from the sponsoring business," Dubois says. While most auctions run an average of 10 days, CityXpress is in discussions with newspapers about staging continuous auctions that would run all year.

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