They were surely giving each other a lot of high-fives at the Google AdWords offices in Mountain View, Ann Arbor, and New York, as it was recently reported that spending in online advertising had finally caught up to traditional print advertising – and easily passed them by. According to eMarketer, domestic spending on online ads will hit $25.8 billion this year, surpassing the $22.8 billion spent on print ads in newspapers for the same time period. Given that, Q4 of 2010 will be remembered as the first period that online advertising finally overtook newspaper advertising in total spending.
As the consumers shift away from print readership, marketers are pouring billions into internet ads – creating double-digit growth for online marketing. Newspapers are feeling the pinch as advertising dollars shrink. For advertisers, print media presents a major problem. Success is difficult – maybe impossible – to measure. Any newspaper advertising office will tell a prospective buyer that the general populace still reads printed publications. However, you only have to ask your local butcher, baker, or candlestick maker about their experience with print advertising and you’ll hear no lack of caterwauling about how they can’t see a measurable increase in sales when they unleash a print advertising campaign. More and more, local businesses find it hard to justify the print media expenditure. On the flipside, businesses of all types are turning in droves to online advertising. But is investing print advertising a bad proposition entirely? Has the success of online advertising doomed print advertising for good?
“We all know that the success of online advertising has been a long time coming; but print ads still serve a purpose,” said David Barnes, Founder and President of Rank Fuse Interactive. “As a pull-marketing strategy, online advertising continues to grow and see enormous success. Last year, total domestic online ad spending reached $25.6 billion. And now, Forester Research predicts that by 2014 we’ll see spending reach $32 billion or more. At Rank Fuse Interactive, we know the value of online advertising in any campaign but we’ve also learned that the competitive landscape sometimes calls for a marketing plan that is supplemented by traditional print advertising. Strange as it may sound, print ads sometimes help us create and support a more successful online campaign.”
This is a glimmer of good news for the print ad industry, perhaps. But the beleaguered newsprint business isn’t too happy with current events. According to the Newspaper Association of America, daily ad revenues (not adjusted for inflation) reached their all-time peak in 2000 and have seen declines every year since. It’s no secret that scores of newspapers have seen closures, cutbacks, and bankruptcy. A report titled “Specifics on Newspapers” from the State of News Media recently claimed that the newspaper industry has shed a full fifth of its journalists since 2001.
So what does a downturn in advertising dollars mean for the future of daily and national newspapers? It’s hard to say with great accuracy. Yes, there is genuine advertising dollar depletion and soaring newsprint prices. Mixed with erosion in newspaper readership, it becomes an uncomfortable state of affairs for newspaper ad people across the country. But experts in the industry point to a new dawn for printed news materials in small print runs and via e-papers customized for content. A second life for print ads may come from the growing popularity of e-readers and tablet devices.