GLOBAL: News publishers, hard hit by the switch to digital and a loss of print advertising revenue, are exploring new business models as they seek to counter a global loss of £28bn in revenue over the past five years, according to a new WARC report.
The latest monthly Global Ad Trends report focuses on digital and print publishing, noting that newsbrands’ combined revenue has dipped globally by $27.8bn between 2012 and 2017.
Rising income from print circulation and digital subscriptions has not been nearly enough to offset a $40.1bn decline in print ad receipts over the period.
Print circulation revenue has grown by around 1.6% each year, rising from $80.4bn in 2012 to an estimated $86.8bn in 2017 (57.5% of the total). Once the main source of income, print advertising now contributes 33.2% towards the bottom line.
And while digital’s share of newsbrands’ ad income is growing, it is not yet enough to offset print’s decline. Income from digital ads ($10.1bn in 2017, of which $4.7bn is transacted in the US) now provides a further 6.7%, and digital subscriptions just 2.6%.
So publishers are looking elsewhere, with many building branded content teams, for example.
A recent WAN-IFRA survey found that most respondents expected that non-traditional income (ie other than circulation, subscriptions and advertising) would contribute between 31% and 40% of their total income by 2022, compared with less than 10% now.
The early hopes that publishers may have had for distributing content via Facebook now seem over-optimistic: they may be able to target new audiences at scale but readers tend not to remember the names of newsbrands they are referred to, monetisation remains an issue and publishers are always exposed to changes in the platform’s algorithm.
In the UK, several newsbrands have recently come together to enable advertisers and agencies to buy digital inventory across their titles and access a combined audience roughly on a par with Facebook’s reach in country – which could indicate possible future models for other publishers.
“The data underline the scale of the challenge facing publishers – despite robust consumer interest in their products,” said James McDonald, WARC’s Data Editor.
“The response appears to be to club together to build scale, to emphasise the importance of context and brand safety, and to diversify revenue streams, particularly into native and branded content.”
Sourced from WARC