1

Building Readership 2006

Targeting our Best Customers

Prepared by: M. Harris, V. Thomas

& G. Bright

2

A Generation is composed of people whose common

location in history lends them a collective persona

Generation Birth Years Age Entering 2006 Famous Man Famous Woman

GI /Depression Era 1901-1924 81-105 John Kennedy Clare Booth Luce

Silent /Greatest Generation 1925-1945 60-80 Colin Powell Gloria Steinem

Boomers 1946-1964 41-59 Steven Spielberg Oprah Winfrey

Gen X 1965-1981 25-40 Michael Jordan Jodie Foster

Gen Y /Millennials 1982-2002 <25 Frankie Muniz Mandy Moore

3

Why target Baby Boomers?…Significant Purchasing Power

They control over half the discretionary income in the U.S. but receive less than 10% of all ad messages

Between 2005 and 2010, adults 45 and older will outspend younger adults by $1 trillion

70% the nation’s net worth is in their hands

78 million strong, Baby Boomers are the largest, most influential, best educated and most affluent generation in American history

Locally median household income is 40% higher than the market average

Sources: U.S. Census, U.S. Federal Reserve Board,

Ageless Marketing David Wolfe 2003, 2005 MA Study

4

The second reason: High Growth

Every 7.5 seconds someone in America turns 50. 10,000

Boomers turn 50 every day

In 2006, the U.S. Census Bureau estimates that Baby

Boomers will turn 60 at the rate of over 7,900 every day and

330 every hour

In Arizona, the 50-65 age segment will grow by 83% between

2000 and 2020 while 25 to 44 segment is projected to grow

32%

They represent a significant part of our core products yet

there is significant opportunity to grow

Sources: U.S. Census,2005 Audience Aggregation Study

5

Demographics & Geography

How important are Baby Boomers to the market?

What makes them unique?

Where can you expect to find them?

6

Baby Boomers –1 out of 3 Phoenix adults and 1

out of 3 area head of households

40-59

33%

18-39

45%

60+

22% 40-59

34%

18-39

43%

60+

23%

Occupied Households

(1.4 million)

Adult Population

(2.8 million)

Source: 2005 Audience Aggregation Study,

Maxx Database

7

Baby Boomer Republic Subscribers: More Affluent

Even Better Educated: 59% have a college degree or higher vs. 46% for all Baby Boomers

Even Higher Income: Median HH income of $81,100 vs. $65,300 for all Baby Boomers

Same Low Presence of C<18: 63% do not have children <18—equal to the market and Baby Boomers

Lower Hispanic Penetration: Only 9% of subscribers are Hispanic vs.15% of all Baby Boomers

Greater Homeownership: 90% own their home vs. 83% of all Baby Boomers

Even Less Likely to Move: 78% been in their homes >3 years vs. 73% for all Baby Boomers

Source: 2005 Audience Aggregation Study

8

Readership

9

Source: General Social Survey 1972-2004

Because While Nationally Readership Has Fallen…

Percent Reading Newspapers Every Day

Source: General Social Survey 1972-2004

20%

30%

40%

50%

60%

70%

80%

1972

1975

1977

1978

1982

1983

1985

1986

1987

1988

1989

1990

1991

1993

1994

1996

1998

2000

2002

2004

10

Baby Boomers Readers Were Reading in Greater Numbers When

They Were Young Adults and Erosion Has Been More Gradual

Source: General Social Survey 1972-2004

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

1972 1977 1982 1985 1987 1989 1991 1994 1998 2002

Greatest Generation Baby Boomers Generation X Generation Y

11

And over the past 4 years Boomer readership both

continues to lead the market and been more stable …

Source: Scarborough

Boomer Daily

Boomer Sunday

52.0%

36.0%

42.4% 42.0%

44.0%

55.1%

46.5%

55.0%

20%

25%

30%

35%

40%

45%

50%

55%

60%

2001 2004

12

But its essential to find more of our best customers

because only 1 out 4 adults will reading the daily in 3 years

if we do nothing…

55.1%

42.4%

28.9%

37.1%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

2001 2002 2003 2004 2005 2006 2007 2008

Source: Scarborough, Internal Estimate

13

Circulation Trends

• What is our current subscriber penetration of the target group?

• Where are they?

14

Household penetration of the target exceeds the market by

29% but still an opportunity to acquire more than 66% of

Baby Boomer households

Subs,

305,639,

24%

Ex Subs,

656,263,

51%

Never

Subs,

323,058,

25%

Market Baby Boomers

Subs,

139,647,

31%

Ex Subs,

216,402,

47%

Never

Subs,

101,785,

22%

Source: Maxx Database

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High Retention, harder to acquire

"Shy Beautiful Girls"

"Hard to get to know…but worth the effort."

Great Retention, and easy to acquire

"Shining Stars"

"Your Straight A Students"

Don't retain well but easy to acquire

"Problem Children"

"Worth Keeping, but need some love"

Don't retain well, and hard to acquire

"Misfits and Market Dogs"

"A dollar spent is a dollar wasted"

Low Ability to Attract High

Lo

w

A

bili

ty t

o R

eta

in

H

igh

Circulation Segmentation - Acquisition / Retention Grid

16

Circulation Segmentation – Opportunities by Quadrant

High Retention, harder to acquire

"Shy Beautiful Girls"

"Hard to get to know…but worth the effort."

Great Retention, and easy to acquire

"Shining Stars"

"Your Straight A Students"

Don't retain well but easy to acquire

"Problem Children"

"Worth Keeping, but need some love"

Don't retain well, and hard to acquire

"Misfits and Market Dogs"

"A dollar spent is a dollar wasted"

Low Ability to Attract High

Lo

w

A

bili

ty t

o R

eta

in

H

igh

Quadrant Size: 108,956

Subscribers: 31,305 (29%)

Opportunity: 77,651

Quadrant Size: 520,247

Subscribers: 189,815 (36%)

Opportunity: 330,432

Quadrant Size: 247,820

Subscribers: 42,824 (17%)

Opportunity: 204,996

Quadrant Size: 407,937

Subscribers: 41,095 (10%)

Opportunity: 366,842

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= Mature = Younger Years = Family Years

Profile of Subscribers by Lifestage/Quadrant

18

= Affluent Empty Nests = Conservative Classics = Cautious Couples = Striving Seniors

Today’s Focus: Mature Years (Our Core Subscribers)

19

Overall Market Size by PRIZM/Lifestage

= Mature = Younger Years = Family Years

20

= Mature = Younger Years = Family Years

Overall Market Size by PRIZM/Lifestage with Subscribers added

21

= Mature = Younger Years = Family Years

Overall Market with Ability to Attract index Added

Lo

w

Ab

ility

to

Att

ract

Hig

h

22

Attraction index color coded by Quadrant

Lo

w

Ab

ility

to

Att

ract

Hig

h

-

50.00

100.00

150.00

200.00

250.00

50 60 70 80 90 100 110 120 130

Low <------------------------------------------- Ability to Attract -----------------------------------------> High

Lo

w <

---

----

----

----

-- A

bili

ty t

o R

etai

n -

----

----

----

----

> H

igh

Don't retain well but easy to acquire"Problem Children"

"Worth Keeping, but need some love"

Don't retaing well, and hard to acquire"Misfits and Market Dogs"

"A dollar spent is a dollar w aisted"

Great Retention, and easy to acquire"Shining Stars"

"Your Straight A Students"

High Retention, harder to acqure"Shy Beautiful Girls"

"Hard to get to know …but w orth the effort."

23

FINAL TARGET GROUPS

Lo

w

Ab

ility

to

Att

ract

Hig

h

-

50.00

100.00

150.00

200.00

250.00

50 60 70 80 90 100 110 120 130

Low <------------------------------------------- Ability to Attract -----------------------------------------> High

Lo

w <

---

----

----

----

-- A

bili

ty t

o R

etai

n -

----

----

----

----

> H

igh

Don't retain well but easy to acquire"Problem Children"

"Worth Keeping, but need some love"

Don't retaing well, and hard to acquire"Misfits and Market Dogs"

"A dollar spent is a dollar w aisted"

Great Retention, and easy to acquire"Shining Stars"

"Your Straight A Students"

High Retention, harder to acqure"Shy Beautiful Girls"

"Hard to get to know …but w orth the effort."

24

Source: Maxx Database

Top 50 zip codes =

90,966 Households

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High income Baby Boomer Opportunity

(by ZIP code)

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The End