Thursday, March 02, 2006
Newspaper Advertising: Say It Ain’t So
byAs a company that represents advertisers, I did a doubletake when I saw this. It’s a story about a speech Vin Crosbie of Borrell Associates made to the World Newspaper Advertising Conference. In his speech, Crosbie was encouraging newspapers to move online faster because “online advertising revenues are rising dramatically.” However, he said it will be a challenge because online advertising revenue produces 20 to 100 times less revenue per reader than traditional newspaper advertising. Doesn’t this beg the question: “Why would any advertiser want to pay 20 to 100 times more to reach an actual physical paper reader than an online reader?”
I believe in newspapers as a consumer. I believe in newspapers as a marketing company. At home, we have a paid subscription to our local newspaper’s online addition. It is apparent the Web is changing everything from a marketing economics viewpoint. However, the figures cited in Crosbie’s speech to a world gathering of the newspaper industry illustrate the tremendous challenge traditional media is facing when transitioning to a Web delivery model. My guess is these numbers would be similar for the magazine industry.
Gavin O’Reilly, President of the World Association of Newspapers, pointed out that one billion people read a newspaper every day. That is an impressive statistic, but we also have to remember there are now one billion people on the Internet. But, if I’m an advertiser, I still have to look at Crosbie’s figures and go “hmmmm.” In marketing, what really matters is not what something costs, but rather, what is the final return on investment. If traditional newspaper readers cost 20 to 100 times what online readers cost, that is a big gap to overcome.
