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NMI: newspaper revenue performance driven by metro mastheads

Display ad revenue for national and metropolitan newspapers has increased at a time when total revenue in the news media advertising market dipped, according to the latest News Media Index, with data collated by Standard Media Index.

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The total sector was down by 6.3 per cent year-on-year in the third quarter of 2018 to $469.7 million, but metro and national newspapers saw a 1.5 per cent increase in display ad revenue in the same period.

The metro display advertising growth was particularly strong in NSW with ad spend up 6.8 per cent. In Victoria metro was up 6.6 per cent and Queensland it increased by 4.5 per cent in Q3.

For digital ad revenue, news media is growing at a faster rate than the SMI agency-only market. The News Media Index, which includes revenue for advertising booked directly with publishers, shows digital revenues up by 8.1 per cent in Q3, while SMI’s data shows digital ad spend grew a lesser 4.1 per cent¹.

Australia’s news media sector remains the third largest media sector by ad revenue, reporting $2 billion for the full 2018 financial year.

NewsMediaWorks chief executive Peter Miller said the industry body continued to be encouraged by the reappraisal of the news media sector by both agencies and marketers.

“The fact that the bedrock of print advertising is metro newspapers demonstrates that our core business is strong,” he said. “Digital ad revenues are also growing and outperforming the total market, which is supported by our emma data showing that 13.1 million Australians read digital news media²

“After a strong four months of revenue growth, the decline in September was expected due to reduced federal government spending. The strength of reader trust in news media in the fake news era can not be underestimated, and we continue to provide advertisers with the most trusted media environment³ for their brands.”

SMI AU/NZ managing director Jane Ractliffe confirmed that the Q3 decline was impacted by falls in September total media market spending. In the second quarter, however, news media ad spend declined by just 3.7 per cent, the lowest since the NMI records began in 2014.

“The NMI data highlights the ongoing improvements in advertising onto news media generally, and especially the higher print spending from the media agency market,” she said.

“But it’s also notable that direct advertisers are a large contributor to the growth of general news websites with the total ad spend from those advertisers soaring 42.4 per cent in the quarter, ensuring those websites collectively grew ad spend by 5.2 per cent over the same three months last year.”

Direct ad spend now accounts for 55 per cent of all news media advertising, again highlighting the difference between the agency and direct ad revenue, although the media agency sector continues to improve.

Unlike the monthly SMI data which reports agency only revenue, the quarterly News Media Index reports all print and digital ad revenue to Australia’s largest news media publishers from both agencies and direct advertisers and is independently verified by SMI.

Sources:

1.     The revenue data is taken from NewsMediaWorks’ members, News Corp Australia, Fairfax Media, West Australian Newspapers and Community Newspaper Group, WA, who represent around 90 per cent of the news media sector.

2.     emmaTM, 12 months to July 2018. Readership based on last four weeks. Trends compared with 12 months to July 2017. Survey conducted by Ipsos Connect, people 14+, Nielsen Digital Ratings (Monthly), now Nielsen Digital Panel, NDP July 2018, People 14+

3.     ADTRUST; Galaxy Research online questionnaire, June 2017 (n=2,863 : 2 legs of n=1400 per media) and April 2018 (n=1400 : 1 leg of n=1400 per media) was conducted among a nationally representative sample of Australians aged 18 years and older. View full results at https://newsmediaworks.com.au/research_type/major-reports/

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