Kudos to my friendly competitor Jen Saba of
Editor & Publisher for
digging a provocative factlet out of the bowels of the Newspaper Association of America Web site: In the second quarter of 2008, newspaper online advertising revenues
declined 2.4 percent compared to the same period a year ago.
That is the first negative quarter since the NAA began breaking online out as a separate category in 2004. As recently as last year, growth was just under 19 percent.
For several years, the NAA has been headlining news releases on quarterly results with the robust online numbers. This time, the association did not put out a release.
Shocking news? Only if you buy into the storyline that online readership and advertising are growing gangbusters as the print product declines. Measures like unique visitors per month do keep on climbing, though the average time spent on site is nothing special -- less than half an hour per month at most.
The online ad trouble has been brewing for awhile. Newspapers are working on diversifying their ad mix, but the vast majority is still tied to traditional classified categories. As print classified business slips away to competitors like Google and Craigslist, there are fewer opportunities for selling an online/print combo.
First quarter industry online advertising was still growing at a respectable 7.2 percent. It is no surprise that the negative second quarter results coincide with drastically deteriorating print performances (losses year-to-year leaping to the high teens at many companies). An economic downturn pinches advertising budgets and that includes online budgets.
Then there is the bigger question of whether online display advertising running next to news content is welcome and effective with readers versus intrusive and ignored. That underscores the importance of better targeting and new revenue streams, as mentioned in our frequent posts on such possibilities as a national ad partnership with Yahoo or the simmering mobile and e-paper markets.
Silver lining? If there is a tight connection between these bad results and the downturn, a bounceback, probably a big bounceback, can be expected down the road. And even with reduced circulation, newspaper print ads are part of the mix (and at a premium price) for a great many advertisers.
