The survey, contained in a new Strategy Report from WAN’s Shaping the Future of the Newspaper project, showed that newspapers in developed countries increased overall revenues by 4.2 percent in 2005 from a year earlier. Revenues from print classified advertising increased by more than 5 percent during the period, a major improvement compared to the decline of 12 percent reported last year, when overall revenues grew by more than 4 percent.
"The overall figures mask a major contrast between the growth in recruitment and property advertising on the one hand, and the collapsing categories of automotive, travel and private party advertising on the other," the report said. "The data suggests that the growth in recruitment advertising was not only cyclical, but for the first time newspapers have increased their overall market share in this category. This reversal underscores a promising change for the long-term health of the industry."
The survey found that 6.8 percent of all classified advertising revenue came from online activities and that two out of three dollars earned by newspapers online are revenues from classified advertising. But, in terms of revenue, the migration appears slower than expected.
In the recruitment sector, newspapers combined print and digital share of the advertising market increased from 49 percent in 2004 to 50.5 percent in 2005.
In property advertising, publishers taking part in the survey reported the highest print revenue increase -- 45 percent -- though much of the gain had to do with the property boom in most markets. Both print and digital market share increased year-on-year.
Market share of automotive classified advertising, however, was down 12 percent from the previous year, by far the biggest lost across all categories.
The Digital Classifieds Survey, the third in an annual series of six Strategy Reports from the Shaping the Future of the Newspaper project, includes recommendations for newspapers to help build both print and digital classified revenues and better manage the migration of advertising from print to the web.
The report is available exclusively to WAN members. More information about the SFN project, and membership in WAN, can be found at www.futureofthenewspaper.com.
The report’s table of contents and introduction can be found here.
"The central message of this year’s study of classified migration is that complacency is still the largest enemy of the newspaper industry," says the report. "While many newspapers have a dominant market position online, the majority still do not have a realistic strategy to face the inevitable migration process: they have so far failed to adjust their business models and mindset to the new market place."
The Digital Trends Survey also found:
 The internet accounted for 7.6 percent of recruitment revenues at newspapers that participated in the study, up from 2.7 percent in 2004 and 1.5 percent in 2003.
White collar jobs tend to be the first recruitment category to migrate to the internet and is the category were newspapers have lost the most of the last few years: 21 percent of their market share has moved online.
Newspapers have managed to hold on to about one quarter of the revenues lost from print in their own online operations. Another quarter of the revenues have migrated to "pure play" internet companies, while the remaining revenues have been cost savings to advertisers due to lower rates and fiercer competition online than in print. A further problem for newspapers is their inability to charge anything close to print rates for ads placed online.
For regional newspapers, property advertising has emerged as the least vulnerable category because this is the most "local" area of advertising.
Automotive advertising has been hard hit because auto dealers are finding themselves "disintermediated" -- classified sites and direct sales channels are cutting out the need for dealers from the sale of used cars. This poses a dilemma for newspapers: if they embrace the change and offer platforms like direct sales, they are likely to alienate their most important advertisers.
The SFN project, which WAN conducts with five strategic business partners, identifies, analyses and publicises all important breakthroughs and opportunities that can benefit newspapers all over the world.
The "Digital Trends" report and the five other Strategy Reports in the 2006 series -- New Revenue Strategies, Outsourcing, New Editorial Concepts, Advertising Science, and Pricing Strategies -- are available exclusively to WAN members. More about the project, and the benefits, can be found at www.futureofthenewspaper.com.
In addition to the annual strategy reports, SFN provides WAN members with a library of case studies and business ideas, and a wealth of other vital information for all those who need to follow press industry trends.
WAN conducts the SFN project with support from five international partners -- PubliGroupe, the Swiss-based international advertising and promotion group; MAN Roland, a leading company for newspaper production systems; UPM-Kymmene, one of the world’s leading printing paper producers; Telenor, the leading Norwegian telecommunications, IT and media group; and Samsung Electronics, a global leader in semiconductor, telecommunication, and digital convergence technology.
The Paris-based WAN, the global organisation for the newspaper industry, represents 18,000 newspapers; its membership includes 73 national newspaper associations, newspapers and newspaper executives in 102 countries, 11 news agencies and nine regional and world-wide press groups.
Inquiries to: Larry Kilman, Director of Communications, WAN, 7 rue Geoffroy St Hilaire, 75005 Paris France. Tel: +33 1 47 42 85 00. Fax: +33 1 47 42 49 48. Mobile: +33 6 10 28 97 36. E-mail: lkilman@wan.asso.fr. |
