Reason Why Print Newspaper Industry is Losing Ad Revenue by the Billions

In the truest sense this is really no news, perhaps because millions of people outside the newspaper industry have seen it coming at least two decades ago, in the early 1990's. According to the Newspaper Association of America , “Print advertising was down 28.6 percent (in 2009), to $24.82 billion, while online was down 11.8 percent to $2.74 billion. Combined, revenue fell 27.2 percent to $27.56 billion, compared to $37.84 billion in 2008.”

Not only is print advertising down, it is decline on steroid. “...the drop last year shows an acceleration in decline for the year-over-year period... The decline from 2005 to 2006 was 1.7 percent, in 2007 the decline was 9.4 percent and in 2008 the decline was 17.7 percent.”

In a 17 March 2011 article, 3News reported, “ Newspaper advertising in the US has sunk to a 25-year low as marketing budgets followed readers to the internet, where advertising is far cheaper than what publishers have been able to command in print.”

The lament goes on. “Advertisers spent US$25.8 billion on newspapers' print and digital editions last year... That's the lowest amount since 1985 when total newspaper advertising stood at US$25.2 billion... After adjusting for inflation, newspaper advertising now stands at about the same level as nearly 50 years ago. In 1962, newspaper advertising totaled US$3.7 billion, which translates to about US$26 billion today... Print advertising has fallen in each of the past five years, dramatically shrinking newspaper publishers' main source of income. Even as the economy has gradually improved since 2009, newspapers are still bringing in less revenue as advertisers embrace free or cheaper internet alternatives that aim to deliver the messages to people most likely to be interested in the products being pitched.”

The newspaper should not blame their print ad woes on the Internet alone. Blind greed is the underline cause of their demise. Newspaper operators have been dulled and blinded to the reality that their customers would not always put up with the ridiculous rates they charge. One would think that newspapers would cut the rate they charge for print ad in broad view of their declining readership. How can you realistically charge your customers the same rate when you know fewer readers will see their ads?

But that's exactly what print newspapers have insisted on: keeping their rate for ads the same while their circulation has dwindled.

Individuals, organizations and businesses were forced to pay the sky-high rates as long as there was no real alternative to print ad. The newspaper industry took “forced to pay” as “willing to pay”. And that's why they never predicted or saw the erasure of ad revenue coming, though the signs were right under their noses.

The dawn of the 2007 recession served to make print ads a luxury few businesses, organizations and individuals could afford.

A personal story. Days ago I asked a friend of mine to go with me to the offices of our local paper. “I'm going to place a Wanted Ad for our church,” I told him.

We arrived, waited, and finally got the rates. Price-shocked we walked out of the building without placing the ad.

“ How do they come up with a price like that?” I sighed.

My friend replied, “I have no idea.”

Here's the ad: “Music Leader for Sunday morning worship at (name of church). Part time position. Call (phone number)”.

For that, The Messenger-Inquirer wants us to pay $249.58 for seven days; $179.95 for Sunday only; and $187.83 for the weekend package (Friday–Sunday).

Just for the fun of it I contacted The Evansville Courier in a nearby city, and I received this quote via email: “ Friday, Saturday and Sunday and 30 days online = $315.29; 1 week and 30 days online = $345.02”

Feeling the thrill by now, I called Thrifty Nickel (not a newspaper) to get a quote for 20 words to run for 4 weeks. Price? Twenty-eight dollars ($28)!

Want to guess who got our business, and who is likely to get our repeat business?

Indeed, we leave it up to big-name newspapers to commit suicide with their sky-is-the-limit rates for print and display ads, which sometimes run in the hundreds of thousands of dollars. They are poised to price themselves right out of business! And the new media is cheering them on to do just that.

Greed is such a self-consuming sensation, fond of digging its own grave eventually, aiming all the while to stick it to the customer.

Sources: fnblog.com; 3news.com