Nieman Foundation at Harvard
HOME
          
LATEST STORY
The Wall Street Journal website — paywalled from the very beginning — turns 20 years old today
ABOUT                    SUBSCRIBE
March 25, 2010, 9:39 a.m.

NAA chief on Q4: “Velocity of ad decline is moderating”

The Newspaper Association of America has quietly updated the “trends and numbers” section of its site with fourth-quarter 2009 revenue, showing a 14th consecutive quarter of overall revenue loss and only a few indications of slowdown or reversal in the downtrend.

Counting online revenue, the industry’s total revenue came in 23.73 percent below Q4 of 2008. In the first three quarters of 2009, the losses were 28.28 percent, 29.00 percent and 27.94 percent. While the lower loss rate in the Q4 results could be considered an improvement, the only category with a significant improvement was online advertising, which lost just 1.00 percent in Q4, compared to drops of 13.40 percent, 15.90 percent and 16.92 percent in the first three quarters. (For the full year, total revenue came in at $27.564 billion, which is a mere $64 million over my prediction made back on September 22.)

Putting the best possible spin on the situation, NAA President and CEO John F. Sturm said in a statement: “The velocity of the advertising decline for print classifieds continued to moderate, and adverse trends for national advertising and newspaper Web sites lessened considerably as last year came to a close.” He added that he had been hearing “buzz” that this “ad trend improvement” was continuing in the first quarter of 2010.

Indications from a few of the firms for the first quarter of 2010 do point to a smaller loss, perhaps in the low teens. Since the downtrend began in 2006, the industry has lost more than 44 percent percent of its revenue, including nearly 48 percent of print revenue.

In most categories, Q4 provided no particular relief from the downtrend. Some details:

Online revenue, as noted, was down just 1.00 percent, perhaps an indication of better days ahead. Part of the problem for online has been that for many, if not most publishers, a good fraction of online revenue is directly tied to printed advertising, with the online component sold as an “upsell” or added value proposition. This means online volume drops right along with print, even if there’s growth in ads sold on an online-only basis. As I mentioned a few weeks ago, at E.W. Scripps, this linkage of online and print covers about half of all online advertising, and I’m finding similar levels at other firms.

Retail revenue (the largest category) was down 24.33 percent, continuing precisely the track it was on for the first three quarters (which were off 23.68 percent, 24.92 percent and 23.98 percent, consecutively). And keep in mind that while retail sales have not rebounded much, we’ve had GDP growth since mid-2009. Every retail category measured by NAA showed a decline, which has been the case all year. Not surprisingly, the worst drop was in the building materials category, which fell 36.58 percent, a tad better than losses in the 50 percent ballpark for the first three quarters.

Classified revenue was down 31.72 percent, falling less than the first three quarters (42.34 percent, 40.42 percent and 37.90 percent), but that may be because there’s just not much left to lose. In Q4, total classified revenue was $1.757 billion, compared with $5.243 billion in Q4 of 2005, the best quarter ever in classified volume. In other words, in four years, more than 66 percent of classified revenue has evaporated.

As in retail, every classified category (automotive, real estate, recruitment and other) was down in every quarter of 2009. The slight reduction in the rate of decline can be attributed to slowdowns in the loss rates in automotive (down just 37.0 percent in Q4 versus losses in the low 40s during the first three quarters), and “other,” which was off just 8.0 percent (versus 16.1 percent, 11.7 percent and 8.8 percent earlier in the year), but that “improvement” is probably due to the growth in foreclosure notices, which are generally counted in this category.

National revenue fell 19.80 percent, compared with losses of 25.87 percent, 29.61 percent and 29.84 percent in the first three quarters. National saw small upticks in automotive (based on spending by manufacturers to support the cash for clunkers incentives), food, household furniture and furnishings (which almost doubled), and medical and toiletries. While most categories were down, at least there is evidence of a few actual trend reversals in spending by national brands.

POSTED     March 25, 2010, 9:39 a.m.
SHARE THIS STORY
   
Show comments  
Show tags
 
Join the 15,000 who get the freshest future-of-journalism news in our daily email.
The Wall Street Journal website — paywalled from the very beginning — turns 20 years old today
“From the very beginning it was very clear we needed to cover all the same concerns and sensibilities of the print Journal even though we were online and even though we were a young staff.”
Newsonomics: In the platform wars, how well are you armed?
“Think about platforms as fishing places where you can find large, engaged audiences and build a relationship with them by providing content. Then offer these users some other services off-platform.”
Wired’s making the long and slow switch to HTTPS and it wants to help other news sites do the same
With its HTTPS implementation, Wired’s starting with its security vertical and for users who pay for the ad-free version of the site.
What to read next
0
tweets
What happens to a great open source project when its creators are no longer using the tool themselves?
PANDA, the four-year-old Knight News Challenge-winning newsroom application for storing and analyzing large data sets, still has a respectable community of users, but could now use a new longterm caretaker.
0“People want to see themselves”: Postloudness aims to build a podcast network for diverse voices
“We have so many friends in this city doing great things, but there hasn’t been the right platform for them to break through.”
0No garbage fires here: Medium advances its quest to gentrify the world of Internet publishing
The search for a clean, well-lighted place on the Internet.
These stories are our most popular on Twitter over the past 30 days.
See all our most recent pieces ➚
Fuego is our heat-seeking Twitter bot, tracking the links the future-of-journalism crowd is talking about most on Twitter.
Here are a few of the top links Fuego’s currently watching.   Get the full Fuego ➚
Encyclo is our encyclopedia of the future of news, chronicling the key players in journalism’s evolution.
Here are a few of the entries you’ll find in Encyclo.   Get the full Encyclo ➚
Corporation for Public Broadcasting
The Guardian
Talking Points Memo
U.S. News & World Report
Charlottesville Tomorrow
The New Yorker
Arizona Guardian
Slate
Twitter
Hacks/Hackers
PubliCola
The Washington Post