Something profoundly significant has taken place in the global newspaper industry; a change that has been in the making for some time is now, finally, here.
As reported by the World Association of Newspapers (WAN-IFRA) last week, global newspaper circulation revenues have out-grown advertising revenues for the first time this century, meaning that audiences – not advertisers – are now publishers’ main source of income.
This is not to say that newspapers have given up on advertisers or vice-versa – far from it, especially now that stability has returned to the ad market – but rather that both sides now have more options to explore and exploit. (Advertisers, for example, now have upwards of 50 media channels available to them.)
For some newspaper titles and groups, ‘readership revenue’ has been the main driver of growth for some time already: as far back as 2012 the New York Times Co. attributed a jump in profits to the fact that revenue from subscribers had overtaken that of advertising. It seems the paywall is starting to pay off.
And on a global scale, it’s safe to say that the shift from a B2B publishing model (publishers to advertisers) to a more consumer-focussed strategy is a game-changer for publishers, opening up as it does a new and entirely sustainable income source: people.
This is what WAN-IFRA and, closer to home, NewsBrands Ireland have been saying all along, and it looks as though they were right. Even in the age of ubiquitous news content – everyone’s a publisher these days – people are willing to pay a premium for quality, original journalism.
We’ve worked with NewsBrands Ireland (formerly NNI) for many years, and we remember only too well the doom-mongers who anticipated the imminent demise of the newspaper – if the ad revenues are tanking (and they were) then the income is drying up, they said, and that’s step one on the road to extinction. Jokes about dead trees have never been so popular as they were five or six years ago.
Even while newspaper advertising revenues were in decline, however, readership levels remained relatively stable. Indeed, newspapers’ reach – a hazy measurement usually expressed in ‘eyeball’ terms – was actually growing as people got their news hit on mobiles, tablets and elsewhere. The audience was still there, in other words, it’s just that publishers hadn’t figured out how to turn people into profit – well, they have now.
WAN-IFA’s annual World Press Trends survey found that, of the estimated $179 billion generated by newspapers in circulation and advertising revenue in 2014, a total of $92 billion came from print and digital circulation while $87 billion came from advertising. Publishers have put a higher value on their content, and consumers have followed suit.
“We invest more in content creation than any other business,” said NewsBrands Ireland chairman Vincent Crowley at the organisation’s re-branding launch in Dublin recently. “There is a huge appetite for original, explanatory journalism as people look to understand what is happening in the world and this will form the bedrock of our business, across all platforms and channels, in the years ahead.”
For the first time this century, that business looks to be on solid ground. The way we access and read our newspapers may have changed, and it’s changing all the time, but the important thing is that we’re still reading – long may it continue.