Print is losing out to television, adblocking is on the rise and newspapers are struggling to prove their worth to ad business
The Independent newspaper has gone online only.
In August last year a consortium of Britain’s leading national newspaper publishers launched an advertising campaign to draw attention to the merits of their titles as platforms for advertising. It was an unprecedented initiative. The very fact that six highly competitive rivals were willing to bury their hatchets showed the depth of the problem. They needed advertisers, and most especially their media agencies who book ads for them, to think again about having turned their backs on newspapers.
But the campaign failed. Newspaper groups are reporting further reductions in ad revenue, with falls in money made from print ads in early 2016 even worse than already gloomy predictions and digital far from taking up the slack. The outlook for summer looks anything but sunny.
Why should this be? Newspapers may be losing readers for their print versions, but they attract huge online audiences. The figures are a matter of record. And more than 7 million people still buy a newsprint paper in the UK each day while a further 2 million pick one up free.
Looking across both digital and print platforms, some 46 million people read a news brand each month. That is a mighty slice of the country’s overall population. As Rufus Olins, chief executive of Newsworks, the marketing body for national papers, points out, that is “even more than the number of people who use Google in the UK”.
Advertisers surely know those figures but many are ignoring them. There are conflicting views about the reasons. Some believe there is a structural problem because creative agencies tend to outsource responsibility for media planning. They say planners, who buy space cheaply and sell it back to agencies at a profit, fail to act in the advertisers’ best interests. Others think a disconnect exists between agencies and their clients, with agencies having become overly convinced about digital technology’s advantages in reaching audiences.
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AdvertisementAdvertisers are drawn to the shiny new world of digital, but ads in papers have been a key component in brand creation down the years. Self-styled “ad contrarian” Bob Hoffman contended at a Newsworks conference last month that no brands have been built by online advertising.
Then there is the problem of advertisers’ obsession with youth, which has been identified by David Wheldon, chief marketing officer of RBS, who says it runs counter to the reality of economic power. While 80% of ads are aimed at young people, some 80% of money is spent by people over 40. Note also that London-based media agencies tend to be staffed by the young.
Print is also losing out to television. Despite the fragmentation of TV and the relatively high cost of screen ads, advertisers seduced by fame are still prepared to spend on the medium, thereby reducing the budget available for buying space in print, which they have come to regard as “legacy media”.
Then there is the significant halt in the rise of digital advertising for news brands. One possible problem there has been the growth in adblocking.
Last month, the Internet Advertising Bureau found that 22% of Britain’s adult web users were using software to strip ads from digital content, up from 15% eight months before. Another survey discovered that more than 40% of people aged under 35 were using mobile adblockers. They do so, evidently, because they find ads interruptive and/or annoying.
Wheldon, who is also president of the World Federation of Advertisers, argued in a speech to an Isba conference last month that the best response was for advertisers to improve the quality of their ads. That may be somewhat idealistic.
AdvertisementMore positively, both Wheldon and Olins stress that there are advertisers who still see virtue in print advertising. It is regarded as the most effective medium for Waitrose, for example, and John Lewis remains faithful to print too. One of the world’s most successful digital companies, Apple, has also been happy to advertise in “old media”.
Olins says: “I certainly don’t think it’s all gloom and doom. I’ve spoken to many people who believe the exodus from print is overdone and we are reaching a more stable point in relation to ad spend.”
His final claim may be more than a little optimistic because that tipping point, if there is to be one, may yet be a way off. In an address to the Isba conference, its president, Simon Litherland, began by speaking of “another eventful and challenging year for UK advertisers”.
Turning to the immediate future, he predicted that the pressures would increase, notably because of the continuing slowdown in the global economy and, in specific British terms, due to the economic uncertainty caused by the EU referendum.
If newspaper advertising, the lifeblood of British journalism for the best part of 200 years, is not to dry up completely, publishers must find new ways to convince advertisers that they have audiences worth targeting. And quickly.