Online ads up — just not enough

by Mathew on November 21, 2007 · 4 comments

Yet another in a long (and I mean long — we’re talking a decade or so) line of depressing declines in newspaper advertising levels, as detailed in a release by the Newspaper Association of America and in this Reuters story. And just to add insult to injury, Alan Mutter of Newsosaur notes both on his own blog and at Silicon Alley Insider that it’s even worse when you take inflation into account. I bet Alan is a lot of fun at parties.

As the Reuters story notes, there is some good news — while regular print advertising fell by 10 per cent in the third quarter, online ads rose by about 21 per cent. That’s good, right? Sure. Except for the fact that online advertising only amounted to about $770-million, and traditional newspaper ads accounted for more than 10 times that amount or about $10-billion. That’s a pretty dramatic gap, as Scott Karp of Publishing 2.0 has pointed out before — something he calls the “10-per-cent problem.”

  • http://www.enotes.com Alex

    I believe there are several problems which newspapers face, but there are also tremendous opportunities for these publishers. The biggest problem is that their basic medium is outdated– I'm not just talking about printing, but rather the idea that a local newspaper needs to be a source of every type of news under the sun. There is tremendous overlap in what's reported every day by the major dailies and news services. This made sense when the only way to get the information was via local delivery, but with the web this is a huge cost which is unjustified by the distribution.

    Because of the near monopoly most newspapers have on their cities, they have been able to charge insane ad rates to reach people. What they need to do now is provide ways for a larger advertiser base to reach their local readers more efficiently. Targeting their web experience to individuals based on information they can get is the very best way to do this. In short, newspapers need to stop relying on a few huge advertisers to pay insane rates, and instead need to provide those advertisers with much more targeted ads perhaps tied to some CPA type ads, and at the same time create a huge self-service, targeted ads program for every single local advertiser in their region.

    Without a consolidation of newsgathering, a hyper-local approach to news and media, and a highly targeted, innovative ads system, newspapers will die. And it will be their fault, because they are positioned better then anyone to reap the massive rewards local/regional news and media can provide.

  • http://www.mathewingram.com/work mathewi

    Those are all good points, Alex. Thanks for the comment.

  • http://www.enotes.com Alex

    I believe there are several problems which newspapers face, but there are also tremendous opportunities for these publishers. The biggest problem is that their basic medium is outdated– I'm not just talking about printing, but rather the idea that a local newspaper needs to be a source of every type of news under the sun. There is tremendous overlap in what's reported every day by the major dailies and news services. This made sense when the only way to get the information was via local delivery, but with the web this is a huge cost which is unjustified by the distribution.

    Because of the near monopoly most newspapers have on their cities, they have been able to charge insane ad rates to reach people. What they need to do now is provide ways for a larger advertiser base to reach their local readers more efficiently. Targeting their web experience to individuals based on information they can get is the very best way to do this. In short, newspapers need to stop relying on a few huge advertisers to pay insane rates, and instead need to provide those advertisers with much more targeted ads perhaps tied to some CPA type ads, and at the same time create a huge self-service, targeted ads program for every single local advertiser in their region.

    Without a consolidation of newsgathering, a hyper-local approach to news and media, and a highly targeted, innovative ads system, newspapers will die. And it will be their fault, because they are positioned better then anyone to reap the massive rewards local/regional news and media can provide.

  • http://www.mathewingram.com/work mathewi

    Those are all good points, Alex. Thanks for the comment.

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