print ads

I remember the other day when I asked a friend why would they give out Metro (Vancouver’s newspaper) for free. His answer was simple, “Because if you don’t give it for free, who’s gonna buy it?”. The conversation went on, “Well some people still read newspapers you know.” and his next reply was pretty much expected, “But most people read their news online. It’s free, very updated and well sorted.” That conversation got me thinking. Technology keeps on evolving, making the distribution of information and contents much more easier than ever before. You can get everything online now, from news, gossips even ads. So the question here is : “How about magazines and newspapers? Are they still relevant?” However, what I am trying to talk about now is their funding. Magazines and newspapers run entirely from ads. Ads are their source of capital, the heartbeat of the whole operating cycle. Unfortunately, technology fucks it all up. The print ads keep declining while digital ads keep rising. Technically speaking, digital ads slaughter the existence of print ads. Or do they?

PricewaterhouseCoopers estimated that over the next five years, the annual global growth rate for media and entertainment industry will be 4.2%, slower than the predicted growth rate of global GDP. This happens because of the the declining of revenue from print advertising, music downloads and cinemas, which are replaced by more efficient digital mediums like digital advertising, music streaming and digital home video.

Moody, a renowned ad agency in the U.S., predicts that newspapers and magazines worldwide will each continue to decline at average rates of 5% per year between 2016 and 2019, falling to 8% and 4% market shares within three years. That’s down from 28% share for newspapers and 13% share for magazines in 2006. “Technology-driven shifts in consumer reading habits keep hurting newspapers, and competition for advertisers continues to rise from search engines, social media and digital video,” says Alina Khavulya, VP and senior analyst at Moody’s. “Print titles will continue to lose market share as their readers continue to move to online versions of the print brands or other forms of information and entertainment entirely,” he adds. Another ad agency called Zenith also predicts that both print newspapers and magazines will continue to decline in global ad spend, with newspaper losing $8.2 billion and magazines losing $4.3 billion. In contrast, mobile advertising to increase $82 billion, $6.8 billion for television and $1 billion for radio.

Same thing happens in the U.K. Print media, particularly newspapers, are suffering from declining ad revenues. eMarketer, UK media ad spending, forecasted that newspapers will only attract £1.46 billion ($1.97 billion) ad expenditures in 2017, down 9% from last year. Spending will continue to decline to £1.23 billion ($1.66 billion) by 2021. “Print spend among national and regional ell further than forecast during the first quarter. The losses are largely coming from reduced spend on print display ads, which is due in part to internal restructuring as news publishers’ business moves online,” said James McDonald, senior data analyst at WARC. “A quarter of national’s advertising revenue came from digital formats during the first three months of the year, which was the first time this has happened.

Digital ads also offers many perks, one of which being cheaper than the print ads. This could affect how print media and print ads are circulating, as well as the digital ones. Newspapers and magazines have been taking actions to anticipate it by going “cross-platform”, pairing their digital and print content and ads through subscriptions. The New York Times added more than 500,000 digital subscriptions in 2016, 47% year-over-year rise. The Wall Street Journal added more than 150,000 digital subscriptions, 23% more than before. Chicago Tribune added about 100,000 subscription, a 76% year-over-year gain. However, these gains do not affect the industry’s overall circulation.  A Pew Research Center analysis of data from AAM shows that total weekday circulation for U.S. daily newspapers – both print and digital – fell 8% in 2016, marking the 28th consecutive year of declines. The overall decline includes a 10% decrease in weekday print circulation and a 1% decline in weekday digital circulation. Total weekday circulation for U.S. daily newspapers fell to 35 million, while total Sunday circulation declined to 38 million – the lowest levels since 1945. This concides with delicing in advertising revenue. Pew Research Center analyze seven publicly traded U.S. newspapers and suggess that advertising revenue in the industry has declined 10%, 2% more than the delicine in 2015. This decline puts total ad revenue for the industry at $18 billion in 2016, a third of what it was 10 years ago.

Although the media and entertainment industry’s biggest growth drivers – digital advertising, video streaming, video games – are growing rapidly, they are still not at a rate that’s enough to support the major declines of traditional media. The death of print has also been proven wrong, as in 2016, 56% of American readers still read print newspapers. Furthermore, people still trust newspapers more, with 74% of readers trusting the print newspapers compared to the 49% who trust news from Twitter. Moreover, online news articles are read for an average 30 seconds compared to newspaper readers who spend an average 40 minutes daily. In a Newsworks survey with PricewaterhouseCoopers of 2,600 U.K. citizens and how attentive they are to 15 types of media, print newspapers came out on top as a medium people regularly put time aside for. They feel a personal connection with titles, they trust the contents and they could talk about it.  This indicates that print is still a good platform for high value advertising with more engaged audience.

 

The bottom line is that no one should really be condemning how the market consume their news. Some want digital, some want print and some want both. It is too early and too arrogant to call that print media, especially ads, is dead. In fact, we should expect more of people’s trust on the efficiency of a print media with its glossy engaging ads. One of great example here comes from Vogue magazine. They have strong online presence, but their print copies are entirely priceless. I still remember how I always spent more than $10 every August and February just to get a copy for their March and September Issue.  The reason why I buy their magazine is mainly for their ads. True, it makes up 80% of the whole magazine, but I really don’t mind. They are one of the many sources for people like me who wants to look at beautifully taken photographs of supermodels with clothes that I can’t afford. And it would be useless if you can only see it on your computer’s screen.

 

WORKS CITED

Chavern, David. August 23, 2017. “The Sky is Not Falling and Print is Still Here.” Accessed October 18, 2017. https://www.newsmediaalliance.org/august-ceo-print-alive/

Stuard-Turner, Richard. July 27, 2017. “Ad Spend Grows Again but Print Spend Still Falling”. Accessed October 18, 2017. https://www.printweek.com/print-week/news/1161847/ad-spend-grows-again-but-print-spend-still-falling

Southern, Lucinda. June 6, 2017. “The (not so great) state of UK print advertising in 4 charts”. Accessed October 18, 2017. https://digiday.com/media/print-advertising-uk/

Barthel, Michael. June 1, 2017. “Despite subscription surges for largest U.S. newspapers, circulation and revenue fall for industry overall”. Accessed October 18, 2017. http://www.pewresearch.org/fact-tank/2017/06/01/circulation-and-revenue-fall-for-newspaper-industry/

Sidney, Amber. May 3, 2017. “New York Times Co. Reports Rising Digital Profit as Print Advertising Falls”. Accessed October 18, 2017. https://www.nytimes.com/2017/05/03/business/new-york-times-co-q1-earnings.html

Moody. March 28, 2017, “Competitive Info : Newspaper Ad Totals Keep Falling.” Accessed October 18, 2017. http://www.insideradio.com/free/competitive-info-newspaper-ad-totals-keep-falling/article_bdb8835c-137b-11e7-bb06-bf7058003abe.html

Fisher, Bill. March 17, 2017. “UK Newspapers Fight Falling Ad Revenues”. Accessed October 18, 2017. https://www.emarketer.com/Article/UK-Newspapers-Fight-Falling-Ad-Revenues/1015444