Newspaper Business Model Evolving; Revenue Streams Diversifying
Newspapers
April 18, 2014 -- According to preliminary data compiled by the Newspaper Association of America (NAA), circulation revenue for U.S. newspapers recorded a second consecutive year of growth, rising 3.7% to $10.87 billion in 2013. Overall, total revenue for the multiplatform U.S. newspaper media business amounted to $37.59 billion in 2013, a slight decline from $38.60 billion in the previous year.
Overall, total revenue for the multiplatform U.S. newspaper media business amounted to $37.59 billion in 2013, a slight decline from $38.60 billion in 2012.
Revenues grew in several other categories — such as digital advertising and direct marketing — while income from traditional print advertising channels declined. NAA states that "this trend reflects an industry evolving its business model in a significant way, taking advantage of developments in technology, consumer behavior, and advertiser interest, to grow audience and diversify its revenue stream."
|
US Newspaper Media Revenue (2013) |
||
|
Revenue stream |
$ Billion Revenue |
% Change Y-O-Y |
|
Total revenue |
$37.59 |
-2.6% |
| Ad revenue | 23.57 | -6.5 |
|
Newspaper print |
17.30 |
-8.6 |
|
Digital advertising |
3.42 |
1.5 |
|
Niche/Non-daily |
1.45 |
-5.8 |
|
Direct marketing |
1.40 |
2.4 |
|
Circulation |
10.87 |
3.7 |
|
New/Other |
3.15 |
5.0 |
|
Source: Newspaper Association of America, April 2014 |
||
Key Findings
- Total revenue for 2013 was $37.59 billion, a decrease of 2.6% from the prior year. Within that total, $23.57 billion came from advertising across all platforms, $10.87 billion from circulation and $3.15 billion from newly-developing and other sources.
- Revenue from digital channels — advertising, circulation, digital marketing services, and other — rose 5.8% and accounted for 12% of total industry revenue.
- Revenue outside of advertising and circulation, from newly-developing and other sources, accounted for 8% of total newspaper media revenue, says the report. Digital agency and marketing services, which some newspapers established in 2012 and others launched in 2013, jumped 43%. Event marketing dollars rose 5% while e-commerce earnings slipped 4%. Dollars gained from commercial printing increased 4%, while revenue from distribution of other products to consumers dipped 2%. Other revenue activities such as income from royalties, licensing, rental,waste and scrap sales, climbed 3%.
- Digital advertising rose to $3.42 billion and accounted for 19% of advertising revenue; pure-play (digital only) advertising rose 14%. Mobile advertising revenue, though a small portion of overall total revenue (less than 1%), jumped 77%. An estimated 24% of the $3.42 billion in digital advertising is “pure-play” digital advertising. This is advertising that appears only on newspaper digital platforms, not in the print products
- The $23.79 billion in advertising represents 63% of total revenue in 2013, declining 6.5% from $25.2 billion in 2012. Traditional print advertising was reduced by 8.6% to $17.3 billion, and makes up less than half of total revenue.
- Advertising in the traditional printed daily and Sunday newspaper decreased 8.6% in 2013 from the previous year. Retail advertising dropped 8%, with national advertising also declining by 8%. Classified advertising fell 10.5%.
- Within the circulation revenue total of $10.87 billion, digital-only circulation revenue grew 47%, and print and digital bundled circulation increased 108%. With some companies shifting to all-access packages, print-only circulation revenue from home delivery and single-copy sales dropped 20%
About: NAA projections are based on a broad sample that includes public and private company data collected on a confidential basis. The data are normalized for a 52-week reporting period in both years (2012 and 2013.)
Source: NAA, BUSINESS MODEL EVOLVING, CIRCULATION REVENUE RISING, April 18, 2014.
