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Growth of Online Ad Sales For Newspapers Slowing
The Wall Street Journal reported this morning that online ad revenue for newspapers has slowed dramatically from a year ago. The New York Times warned last week that growth in online ad sales will fall short of its earlier projections, and Tribune reported that Q1 web ad revenue fell sharply from a year ago. Other publishers will be reporting their financial results this week.
The Journal points to three major factors responsible for the decrease in online ad sales. The first is that 70-80% of all newspaper web ads are upsold from print classifieds. As print classifieds in the daily newspapers have eroded dramatically, the opportunity to upsell those advertisers an online ad has disappeared as well. Secondly, advertisers are moving away from banner ads and pop-up ads, the long-time staples of newspaper web sites, in favor of search marketing expenditures. As a result, newspapers are having to rely on Google and Yahoo to bundle such services as ad/key-word buys. This is the primary driver behind the current horse-race for strategic partnerships between daily newspapers and search-oriented companies such as Google and Yahoo. And finally, analysts at research firms like eMarketer are predicting a broader deceleration in online ad revenue, and newspapers have felt and will continue to feel the decline along with everyone else.
[tags]Wall Street Journal, Online Ad Sales, New York Times, Daily Newspapers, Death of Dailies, Decline of Newspapers, Print-Web Partnerships, Search Marketing, SEO, EMarketer, Media, Advertising, Publishing[/tags]