Adspend in regional newsbrands performed ahead of expectations in Q2 2014, according to the latest data from the Advertising Association/Warc Expenditure Report. Even so, newsbrands – inclusive of both print and digital newspaper platforms – still recorded a decline of 1.7% compared with the same period in 2013, despite a 27.9% increase for their digital revenues (to £44m). While growth for digital has gained significant pace in the last three quarters, it has still not been enough to offset the decline in print adspend (this dropped 5.2% to £280m in the latest quarter). But could the regional newsbrands be on the cusp of growth after a difficult decade?

The regional newsbrands sector has witnessed a dramatic shift in fortunes in recent years, as spend has shifted online. Back in 1982, when Warc first started collected quarterly advertising spend data on behalf of the Advertising Association, spend in regional newsbrands accounted for 23% of total UK adspend. By the end of this year, we expect this to have dipped to just 6.6%.

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Note: Includes adspend for dailies and Sundays, paid weeklies and free weeklies.
Source: AA/Warc Expenditure Report

At its peak in 2004, adspend in regional newsbrands amounted to an impressive £3.1bn. Within this total, 68% of spend was attributed to recruitment and other classified advertising. By 2014, with regional adspend set to record a total value of £1.2bn, we expect recruitment and other classified advertising to stand at just 54% of spend, with recruitment in particular having lost considerable share to online specialists (e.g. Jobsite).

However, things could be starting to look up for the beleaguered regionals. For starters, the rate of year-on-year decline is moderating, to 5.0% in 2014 and 4.3% next year. To set this in context, the sector recorded drops of 15.8% and 26.2% in 2008 and 2009 respectively.

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Source: AA/Warc Expenditure Report

Digital adspend revenues for regional newsbrands are now starting to make headway, with growth of 17.4% expected in 2014, followed by a further increase of 8.1% in 2015. Additionally, for the first time since 2004, total recruitment advertising – incorporating print and digital spend – is expected to post a 5% year-on-year increase this year, buoyed by the recent falls in unemployment.

While advertising revenues have fallen, the sector is far from terminal decline. The UK press is still the UK's most popular print medium, read by over 30 million people per week. The rise in digital consumption has forced the sector to diversify and, alongside 1,100 print titles, there are now 1,700 associated websites. As we look to 2016 and beyond, the future looks brighter for regional newsbrands, and it's certainly feasible that advertising revenues will start to register growth accordingly.

Steve Brown, JICREG/NS Intelligence manager, said: "The industry has faced challenges posed by a difficult economy in recent years but local media, in print and online, remains an important and powerful part of the media mix, highly trusted by audiences and a key driver of consumer action, as highlighted by the Consumer Catalyst study from Think Media.

"Fuelled by a growing demand for local news and information, the industry is experiencing a rapid growth in online audiences which is good news for national and local advertisers who understand the power of the highly trusted local media brand to drive consumer action across multiple platforms."

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