followthemedia.com - a knowledge base for media professionals
Fit To Print
ftm newsletter

ftm newsletter updates leading media news each Monday and Thursday.
Click here and you will receive it in your inbox.

AGENDA

All Things Digital
This digital environment

Big Business
Media companies and their world

Brands
Brands and branding, modern and post

The Commonweal
Media associations and institutes

Conflict Zones
Media making a difference

Fit To Print
The Printed Word and the Publishing World

Lingua Franca
Culture and language

Media Rules and Rulers
Media politics

The Numbers
Watching, listening and reading

The Public Service
Public Service Broadcasting

Show Business
Entertainment and entertainers

Sports and Media
Rights, cameras and action

Spots and Space
The Advertising Business

Write On
Journalism with a big J

Send ftm Your News!!
news@followthemedia.com

“Newspapers Are Not Dinosaurs; Newspapers Are Changing And Now They Are Growing Thanks To Their Internet Audiences” – Scarborough Research

With Merrill Lynch and Deutsche Bank issuing new notes lowering their 2007 prognoses for many American newspaper groups, there is some welcome news from the respected Scarborough Research that says newspapers have actually gotten their online act together and there is a fundamental shift in how newspaper readership should be perceived.

Scarborough logoThe problem for Wall Street, however, is that increased numbers of readers to newspaper Internet sites are not yet producing the revenues to replace what print is losing. So while newspapers may indeed be attracting Internet readers Wall Street asks the same question as Tom Cruise asked in the movie Jerry Maguire, “Where’s the Money?”

The answer is that it won’t show in the percentage amounts Wall Street is looking for (minimum 12% of total revenues) for another two years or so at most newspapers, and that is why Merrill Lynch and Deutsche Bank have reduced their 2007 forecasts for many newspaper groups and predict similar poor results for 2008.

ftm background

With Circulation Spiraling Down and Internet Advertising Increasing, What Is The Newspaper Industry’s Solution for a Financially Successful 2006? It’s to Hike Up Advertising Rates and Increase the Cover Price! When Will They Learn?
It’s really not rocket-science marketing. The number of eyes looking at your product is decreasing, and the advertisers who pay the bills are spending more elsewhere. In that type of environment what do you need to do to maintain and grow the cash flow? One might think the prime aim would be to entice new readers and new advertisers, but that doesn’t seem to be the trend as 2006 begins. The newspaper industry instead seems to be going back to last year’s formula that fell flat on its face – charge more for less.

Circulation Increases Four Times As Fast As The Internet Is Growing – No, Don’t Get All Excited -- It’s Visitors to Newspaper Web Sites. On the Other Hand, Maybe That Is Something to Get Excited About!
For all the really bad news about US newspaper circulation figures – down 1.2 million in the past six months – there was one piece of good news: the numbers show undeniably that newspaper web sites are the most frequently visited for news and information.

The Overall Stock Market is Up 5% But Newspapers are Down 12%; 3rd Quarter Newspaper Earnings Expected to Drop an Average 8.5% But the S&P 500 Index expected to Gain 12%. And There Is Absolutely Nothing Out There to Indicate Things Will Get Better Any Time Soon
As the third quarter earnings reporting period approaches expect nothing but bad news for the US newspaper industry. Even worse, don’t expect to see even a glimmer of hope that Happy Days may soon be back again. The numbers are bad and expected to get even worse.

The Bad News for Newspapers Keeps Getting Worse: “Newspaper Revenue Shifts to the Internet” Cries Out One Headline, “Bank Warns Newspapers of Rough 2006” Screams Another

Did You Notice That All Those Big Newspaper Deals This Year to Buy Internet Sites Were for Cash, Not Shares?
Could the average 15% drop In newspaper 2005 share prices have something to do with that?

Currently Internet revenues for those newspapers that have their digital act pretty much together ranges from around 5% to 9% of total revenue.

The frustration for newspapers is that although their print circulation may be down a bit and their advertising revenues are pretty much flat, most of them are still turning a 20% plus margin that a lot of other industries eye with great envy. But Wall Street places its values on what companies will do in the future and for the next two years overall newspaper revenues don’t look to be growing.

But for all of that, the new Scarborough Research report has much to bring joy in the publisher’s suite. The new study makes clear that newspaper performance should no longer be judged just on the print edition. “The name of the game for newspaper companies has become ‘multiple platforms’ where the newspaper web site offers another way to distribute editorial and advertising content,” the survey said. Combining the audiences of all the various platforms should create a fundamental shift in how newspaper readership is perceived, the survey concludes.

Scarborough promotes what it calls the “Integrated Newspaper Audience”, a measurement that combines the audience of traditional printed newspapers with the audiences of their web sites.

The survey points out, “Newspaper web sites are contributing significant numbers of readers who do not necessarily read the printed publications, resulting in larger audiences overall.

And there is an even more important point that should bring joy to advertisers.  “The analysis finds that newspaper web site audiences are young and upscale, dispelling a common misperception that young people are not being successfully engaged by newspaper content.”

Studying those who read both the print and online sites, or just one or the other, the survey concludes, “the ‘online exclusive’ audience accounts for two to 15% of the Integrated Newspaper Audience …This represents hundreds of thousands of readers for many newspapers in larger markets.

Focusing on young readers the survey said, “The audiences for newspaper web sites tend to be younger than those of traditional newspapers. The analysis indicated that newspapers across the board are successfully attracting the 18-to-34-year-olds to their web sites.”

And the survey claimed that the readership of newspaper web sites may be even more upscale than their print counterparts. “Not only are newspaper web site patrons just as desirable from a marketing perspective as their print counterparts, but in many instances, they are even more upscale.”

It gave several examples of specific newspapers where this is true. At The Washington Post, for instance, about 60% of its print readership (those who read the paper at least once a week) have a household income of $75,000 or more, whereas the survey said that 73% of the visitors to washingtonpost.com have household incomes in that same $75,000 range.

In that same vein the Newspaper Association of America (NAA) has reported that newspaper web sites averaged more than 55.5 million unique visitors a month during the first half of 2006, up by 29% from the same period a year ago. But perhaps more important than the leap of unique visitors is that the combined newspaper/digital platforms drove a 15% increase in the numbers for the 25 –34 year-olds and a 10% increase for the 18-24 year olds. The Washington Post, for instance, increased its reach to the 25 – 34 year-olds by 60%.

Newspaper web site page views in July were 52% higher than July last year, representing around a third of all web use.

The study also showed that with age we read newspapers more.  Within the top 50 markets, 66% of 18 – 34 year-olds read a newspaper at least once a week, 77% of the 35 – 54 year-olds, and 83% of those above aged 55.


s
copyright ©2004-2006 ftm publishing, unless otherwise noted Contact UsSponsor ftm