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Newsbrands’ combined revenue has dipped globally by $27.8bn between 2012 and 2017, with rising income from print circulation and digital advertising not enough to offset a $40.1bn decline in print ad receipts over the period. Publishers are now looking to diversify business models to balance the deficit, according to the latest Global Ad Trends report compiled by WARC.
Print (print advertising and print circulation) still accounts for over 90% of newsbrands’ revenue worldwide, though the majority now comes from circulation. 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.
Digital (digital advertising and digital circulation)’s share of newsbrands’ ad income is growing, but 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%.
A quarter of respondents to a recent WAN-IFRA survey believe that non-traditional revenue sources (i.e. those beyond circulation, subscriptions and advertising) currently account for less than 10% of total income. By 2022, most (21%) believe non-traditional income will contribute between 31% and 40%. Branded content teams (such as Guardian Labs, WSJ Custom Studios and T Brand Studio) are becoming in-house fixtures, and partnerships with content recommendation companies (such as Outbrain and Taboola) are commonplace.
The majority of publishers state that their main business objective when engaging with Facebook is to use the platform as a distributor of content. Targeting new audiences and building brand awareness are also key goals, highlighting the social network’s scale.
On average, 26.7% of consumers are sharing news stories online, varying from 43.0% in Brazil to 8.0% in Japan last year. But 53% could not remember the name of the newsbrand when referred from social media. Aside from anonymity, publishers have little control over the user’s overall viewing experience, and monetisation of the audience is a significant issue.
Facebook recently made changes to its news feed algorithm, which de-prioritise video content from third-party media outlets. The move threatens publishers’ “pivot to video”, a strategy which aims to generate more ad income from non-text formats.
Global Ad Trends is part of WARC Data, a dedicated online service featuring current advertising benchmarks, data points, ad trends and user-generated expanded databases, and is available by subscription only at https://www.warc.com/data