Are the reports of newspapers demise greatly exaggerated?

If you follow me on Twitter, you may have noticed I recently shared an article about South Wales Evening Post editor Spencer Freeny retiring. I didn’t share the article because I’m interested in Spencer Freeny, although I hope he enjoys his retirement. What caught my attention was some of the quotes from one of Wales’ most experienced newspaper editors and a lecturer from Cardiff University’s School of journalism.

Here are the key points that caught my attention:

  • Recently published circulation figures show the South Wales Evening Post is the most popular newspaper in Wales, selling an average of 36,623 copies a day in the first 6 months of 2012. However, the figure represents an 8.8% fall in circulation compared to the same period in 2011.
  • The BBC article stated “Mr Freeny said that advertising revenue had about halved at regional newspapers over the past five years.”
  • A lecturer from Cardiff University’s School of journalism (Dr Andy Williams) made this comment referring to regional newspapers. “I’d say it was in crisis. It’s not in a healthy state at all. The main reason is that advertisers don’t want to advertise in papers anymore.”

You can read the full article here

Before I go any further I think it’s important to state that this blog isn’t about badmouthing the current state of the press industry. I also want to highlight that Mr Freeny does think there is a future for regional press.

Both Mr Freeny and Dr Williams also mention other contributing factors as to why revenues and circulations are falling at regional papers, such as the internet, new media formats and a changing society. But….. It’s the comments about advertising revenues and advertisers that really interest me.

I’ve already established that readerships, circulations and press turnover have declined since 2007 in my blog, ‘The curious case of the shrinking ad media that’s doing better than ever!’ However, I have delved deeper for this blog and here’s what I found.

Media market share according to Nielsen – Wales (local advertisers)

As you can see from the figures taken from Nielsen, press still claims the largest proportion of advertising revenue spent in Wales.

Let’s look at the bigger picture and see what’s happening to press across the UK.

Media market share according to Nielsen – UK

Press not only takes the number 1 spot in terms of market share (by a long way) in Wales, but it also comes out as number 2 in the UK market. It’s held these rankings since 2008. These are hardly figures that suggest advertisers simply don’t want to advertise in press. In fact, when I started thinking about this blog I looked through three regional papers, all three were laden with adverts from both national and local advertisers.

When looking at the market share I think it’s important to establish if the size of the market increased or decreased. Comparing 2008 to 2011 the Welsh market shrank by -9%, but the UK market grew by 1%.

I wanted to see how other ‘traditional media’ had fared over the last few years. The graphs below look at advertising revenue (according to Nielsen) generated by press, TV and radio from 2008 to 2011.

In the Welsh market it is evident that the press revenue did decline in 2011, but the fall wasn’t as steep as the graph suggests. In fact press revenue only fell by -9% from 2008 compared to 2011. Radio and TV near enough plateaued over 2008 through to 2011. Across the UK, TV advertising revenue has grown since 2008. Radio seems to have stayed the same, neither growing nor declining.

Press seems to be up and down, but saw a greater decline than in the Welsh market and fell by -12% from 2008 when compared to 2011.

I’m not suggesting that the press industry can solely be measured by their market share of advertising revenue, or the actual sum of revenue they generate from advertising. Ultimately for any company the vital figures are those on your accounts (such as turnover and profit). After all that’s why any company trades, to make money. I looked at the accounts for several regional press owners, as expected they all saw a decline in their turnover and profit over the past few years.

Hard copy might be losing its appeal to consumers which are reflected in the declining circulation figures. And yes, it may no longer be deemed as ‘fashionable’ to advertise in hard copy editions, especially with more modern or new media platforms such as digital and social media advertising. That said, press continues to generate more money than any other media platform in Wales.

I can’t remember the last time I read a positive article or blog about the press industry; they all focus on the negatives in the industry. If the media and blogs I have read are correct, then how does the industry continue to dominate advertising revenue both in Wales and the UK?

Is it simply a question of fashion and fads? Perhaps it’s just that we in are in a world where the traditional is seen as passé and the new-fangled latest thing is always the best option by default?

One is certain, while Press as an industry continues to weigh in with the comparatively huge revenue that it does, it’s a long way for extinction

As always please leave a comment below, or email me jodi.stuart@realradio.co.uk or tweet me @realradioodi

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5 Comments

  1. Interesting…
    I would hazard a guess and say they haven’t completely died off yet because the elder generation that still buy newspapers hold a significant proportion of the country’s wealth. And whilst this is still perceived to be the case, press will always be the main go to media.
    I’ve recently done some stuff on the state of the press marketplace up here – mostly slagging them off for the Account Managers benefits (!) if you’d like to see?
    Bear in mind I’m from a press background (specifically red tops) so I’m used to putting out crash bang wallop style stuff!!

    Cheers

    KC

    Reply
    • Hi Keith, you’re right that circulations haven’t completely died off yet (even though they are declining at a fair rate). What interests me more is in the BBC article they mention that advertisers simply don’t want to advertise in papers anymore. If that’s the case then how do they dominate the local market (being Wales in this case) as the number one choice in terms of advertising revenue. In the national market they take second place in terms of revenue generated. So can we conclude that advertisers no longer want to use press? Even though they continue to do so.

      Reply
  2. Tim Masters

     /  October 11, 2012

    Interesting article Jody. Many people have predicted that newspapers will have all but disappeared within 10 years but Rupert Murdoch (yes him) feels that it will take 20 years at least. realandsmooth makes a very good point about the older generation, holding a significant amount of the country’s wealth, and who, possibly, still like to buy hard copy papers. It would be interesting to see if any of the publishers can gather reliable figures concerning the age groups of their readers instead of the traditional socio-economic rankings.

    Reply
  3. Thanks Tim, I agree that the older generation do hold the majority of the UK’s wealth, and yes I imagine as a general rule of thumb they do prefer hard copy editions. But is the revenue generated from consumer sales enough to secure the future of press? In my opinion it’s more about advertising revenues. There is a website that you can find out the breakdown of readerships of each paper by age and location. If you’re interested it’s easy and free to access http://jiab.jicreg.co.uk/standardreports/selectgeog.cfm?SID=5242536052&UID=13&NoHeader=1&CFID=41937&CFTOKEN=63088774

    Reply
  4. Tim Masters

     /  October 12, 2012

    Hi Jody. Thanks for the link, I’ll take a look at those readership stats. I

    Reply

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