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June 5, 2006 / Toby Dayton

Online Ad Revenue For Newspapers Slowing

The Newspaper Association of America reported Friday that while print advertising growth for the newspaper industry remained relatively flat during the first quarter, online ad revenue rose 34.9%. Unfortunately for the dailies, online ad revenue remains a small percentage of total ad revenue, just 5.5%, and the growth rate was actually smaller than the growth rate of online ad revenue during the same period a year ago. Even more problematic for the industry, when compared to what is happening across the entire online advertising space, the growth rates for the newspaper industry most likely represent a continuing decline in total advertising market share.

The data is similar to quarterly releases in circulation growth – small circulation gains, when compared to overall population growth, actually represent a declining readership as a percentage of the total population. So while the numbers by themselves seem positive at first glance, the growth in online ad revenue is not keeping pace with the rest of the market and certainly is not enough to compensate for the anemic performance of the newspaper industry’s print advertising business.

[tags]Newspaper Association of America, Print Advertising, Online Advertising, Death of Newspapers, U.S. Advertising Industry, Circulation Growth, Newspaper Circulation, Media, Advertising, Traditional Media, Decline of Newspapers, Readers Going Online[/tags]