February 27, 2019 Flash Report, ReportsThe average cover price of national newspapers has risen by 58% since 2010, more than twice the CPI increase of 22%. Are publishers “shooting themselves in the foot” at a time when buyers and advertisers are defecting to online?. To settle this, we analysed all the cover price events by national titles between 2010 and 2018, which reveals the relative success of The Times when it has raised its price. For mid-market and popular titles, cover price hikes have on balance reduced circulation revenues and, by lowering reach, drained advertising revenue: a lose-lose scenario.The average cover price of national newspapers has risen by 58% since 2010, more than twice the CPI increase of 22%. Are publishers “shooting themselves in th [...]Sector Media.
June 4, 2018 Focus Report, ReportsPrint remains the primary revenue driver for most newspapers, but after 20 years of online news publishing we ask the critical question: how will publishers sustain newsrooms at scale when print has disappeared, or has contracted to a weekend luxury experience? The question needs to be answered in the context of both: 1) Rapidly declining advertising revenues in print media; and 2) A tiny and shrinking market share of digital advertising revenues. We believe these circumstances strongly imply the race for audience scale is more investor fallacy than a sustainable business prize; and besides, over-reliance on the advertising market for quality content provision is unappealing, particularly to proudly independent news publishers. Reader revenue, long assumed to be an impossibility for general quality digital news services, is the only answer. Registrations, membership and subscription models are being explored, tested, adopted or exploited by almost every major quality news provider in the US and Europe. The transition to subscription is hugely attractive, but requires first and foremost a new editorial strategy, requiring a wholesale business transformation.Print remains the primary revenue driver for most newspapers, but after 20 years of online news publishing we ask the critical question: how will publishers su [...]
December 21, 2017 ReportsThe slowing UK economy since Q3 2016 has had a knock-on effect on the property and autos marketplaces underlying UK classified advertising revenues, with house prices slowing, transactions stabilising (instead of rising), and new car registrations down sharply in 2017 to date. Recruitment activity by agencies and employers has instead been dynamic as the UK nears full employment. Advertisers in these verticals continue to switch expenditure from print classifieds to internet portals and search, which offer superior lead generation, analytics, and user experience. Only in property do local newspapers still fulfill an important estate agency branding function for the local area, although declining readership is blunting this value to advertisers. Portal dominance comes at a price to advertisers in property, where Rightmove has resisted agent efforts to lessen dependence by listing on other brands, as well as in used autos, where Auto Trader has long reigned supreme. Recruitment is a more contested market for portals, reflecting the diverse and fragmented nature of the jobs market, but Indeed has a strong grip on the low-end, while LinkedIn remains unchallenged in social recruitment advertisingThe slowing UK economy since Q3 2016 has had a knock-on effect on the property and autos marketplaces underlying UK classified advertising [...]October 17, 2017 ReportsEven though Facebook is not a producer of news, 6.5 million UK internet users claim to mainly source their news from the platform. Posts and shares by friends in the user's network, in the context of Facebook's algorithm, determine the order of stories in the personalised News Feed, removing the control of the news agenda that publishers have for their websites. Premium publishers operating a paywall (The Times, The Financial Times) have a lower key approach to Facebook than publishers generating advertising revenue from referral traffic to their websites or from on-platform consumption of Instant Articles. The latter will seek to stimulate social media engagement, optimising stories through attention-grabbing headlines, and installing Facebook’s share and like buttons on their websites. Case studies of the news stories that were prominent on Facebook (measured by likes, comments and shares) in the periods leading up to the Brexit Referendum and General Election 2017 votes respectively demonstrate that newspaper brands (the Express for Brexit, and The Guardian for the General Election) achieved the highest reach on Facebook during these periods, despite being ranked below other news brands (BBC in particular) in terms of traffic to their websitesEven though Facebook is not a producer of news, 6.5 million UK internet users claim to mainly source their news from the platform. Posts and shares by friends i [...]February 26, 2016 Reports
Trinity Mirror is launching a national newspaper, New Day, into a challenging marketplace: declining volumes of -7%, and the loss of £121m (-9%) in advertising in 2015 alone. New Day has been inspired by market research into lapsed newspaper buyers. While consumer behaviour is largely driven by a shift to digital, mobile and social media distributed news, some consumers want a different print product from anything in the marketplace. In digital, New Day eschews the need for a website or App, focusing on social media to market the product; a rare example of a strategy that does not blur or compromise print and digital objectives.
Trinity Mirror is launching a national newspaper, New Day, into a challenging marketplace: declining volumes of -7%, and the loss o [...]October 14, 2015 Reports
Non-subscribers can download this report in full - alongside all our other coverage of the BBC during the Charter Review process - from the 'BBC Charter Review' page of our site. BBC proposals for local media set out on 7 September offer solutions to an alleged market failure, without much evidence, contained in February’s Future of News report. There is no dispute that local commercial print and online media operations have suffered heavy revenue losses since their peak a decade ago – the industry is, however, still profitable, innovation and online growth are helping to stabilise the top-line, and new enterprises are emerging. Local media publishers prefer a turbo-charged BBC policy of linking to their sites to the proposal for a local media digital hub fed by publishers and 100 BBC journalists.
Non-subscribers can download this report in full - alongside all our other coverage of the BBC during the Charter Review process - [...]August 13, 2015 Reports
UK advertising is having a bumper year – some of the strongest growth for two decades – but print is receiving none of this upside. The year started soft then plummeted in the weeks immediately before and since the General Election, with increasingly serious implications for the sector. A reasonably steady UK economy and explosive TV and digital spend evidence a structural decline for print media display, though specific factors also point to some cyclical effects. We forecast a slowing of the rate of decline in H2 2015 and 2016, but we believe sooner or later the industry will have to work closely with agencies and brands to establish new terms of engagement for print media.
UK advertising is having a bumper year – some of the strongest growth for two decades – but print is receiving none of this ups [...]February 16, 2015 Reports
News has entered a new phase, defined by the disruptive forces of mobile, social media and video, effecting rapid changes in consumption and the underlying economics for news businesses: the level of change and innovation is rewiring the structure and financial models for news more quickly than many news providers are able to respond. While charging for news looks to be a successful route for some brands, we note that the scale of charging for the industry is substantially smaller than in print. Apart from this, three models are gathering traction: selling audience engagement; selling news services; and selling news to businesses. Each of these options involves very different strategies and opposing objectives which can only be pursued at the same time by those with the deepest pockets. Everyone else has to choose.
News has entered a new phase, defined by the disruptive forces of mobile, social media and video, effecting rapid changes in consum [...]December 9, 2014 Reports
2014 has been a good year for total advertising, which we forecast to grow by 5.5% across the year; display advertising spend is also forecast to grow by over 6% year-on-year. This is largely thanks to a positive economic backdrop, where we have seen a significant rise in consumer expenditure over the last two years. Online advertising spend has been the biggest recipient of growing ad spend, with 20+% growth last year, this year and next. This has mostly been to the detriment of print revenues, where online classified search solutions, amongst other factors like declining circulation, have disrupted print marketplaces. Video has been the largest growth area in internet advertising as online video consumption increases. Up to now online spend has largely been accretive to TV budgets but we are starting to see some advertisers switch to online video spend. However we do not expect TV to suffer in the same way as press.
2014 has been a good year for total advertising, which we forecast to grow by 5.5% across the year; display advertising spend is al [...]December 19, 2013 Reports
The UK national press remains a big beast' in UK media, selling 7.2 million copies every day, supplemented by 1.6 million free newspapers; however, the decades long decline in print circulation and advertising has accelerated once again with the take off of smartphones and tablets. Print still accounts for the vast majority of the nationals' income, though revenue continues to fall due to declining copy sales and the structural shift of classified ads to the internet; there is also growing evidence that display advertising is declining by more than volume losses in some categories. Digital is gathering momentum due to acceleration in digital advertising and a shift to pay models. In the UK, where print subscription levels are low, and home delivery lower still, publishers face the obvious challenges of digital transition and migration from a newsstand economy to a consumer relationship mindset.
The UK national press remains a big beast' in UK media, selling 7.2 million copies every day, suppl [...]December 19, 2013 Reports
2013 has seen yet another year of strong growth in consumer adoption of mobile devices and screens adding to the challenges facing traditional media. Press and radio have long been affected, but television is now starting to feel the heat. BT and Sky's contest for premium pay-TV sports rights has intensified. August saw the launch of BT Sport, while BT's acquisition of the European football rights in November was a clear statement of intent, spending half of Channel 4's total programming budget on approx. 200 hours of content. The UK has seen buoyant advertising growth of around 4% in 2013, with similar growth expected in 2014, in the context of the strongest economic recovery in Europe.
2013 has seen yet another year of strong growth in consumer adoption of mobile devices and screens ad [...]October 20, 2013 Reports
On 30 October, two days after criminal trials for alleged phone hacking begin, the Privy Council will finally seal a Royal Charter to set up regulation of the press. The end of this drawn-out process might be thought near. Several major publishers are planning to boycott the system by setting up their own regulator, which will not meet the Charter's standards. In recent days, Conservative ministers have said the press is free' to take that route. The Recognition Panel set up by Parliament's Royal Charter may not report on the system's success or (more likely) failure until the autumn after the 2015 election. Whether to have a showdown with publishers who reject the Royal Charter is a decision being put off by everyone.
On 30 October, two days after criminal trials for alleged phone hacking begin, the Privy Council will [...]August 1, 2013 ReportsRegional and local newspaper circulation decline continues to accelerate as consumer demand erodes, especially among daily titles in large towns and cities where readers are younger. Publishers are successfully mitigating circulation revenue decline through aggressive cover price rises but are unable to push up advertising yields in a market where print is considered to be grossly overvalued especially by national advertisers. The promise of a truly digital future remains unfulfilled. The digital classifieds market has largely been won by internet specialists and the local advertising market is becoming hotly contested, not least by Facebook, as mobile traffic rises.Regional and local newspaper circulation decline continues to accelerate as consumer demand erodes, especially among daily titles [...]December 20, 2012 Reports
On 29 November, the Leveson Inquiry into the culture, practices and ethics of the press finally issued its report. Its verdicts on the conduct of the press, politicians and police were less severe than expected. The three main political parties have accepted most of the report's recommendations, but have disagreed over the use of statute. As expected, the Conservatives are against, while Labour and the Lib Dems are in favour. Subsequent cross-party talks and negotiations between editors have so far failed to produce agreement, with the process only becoming more opaque as time goes on. The shape of the future regulatory system remains uncertain.
On 29 November, the Leveson Inquiry into the culture, practices and ethics of the press finally issue [...]December 3, 2012 Reports
This report explores and quantifies expenditure in the local media landscape. Flat disposable income and the rise in e-commerce continue to force many retailers from the high street, though we argue first-rate small and medium enterprises (SMEs) have the opportunity to grow share of the local market, despite these pressures. Technology has radically disrupted the way local businesses reach out to consumers. Not only has advertising expenditure moved online, but SME spend is dissipating into other activities, including distribution and platform developments, PR, social and sponsorship activities and live events. The rise of smartphones has created the tantalising prospect of a perfect local media solution. We assess the level of opportunity for Google, Facebook, Hibu, local newspapers, local radio, local TV and hyperlocal organisations.
This report explores and quantifies expenditure in the local media landscape. Flat disposable income [...]October 17, 2012 Reports
The second of our four reports on specialist advertising focuses on the property sector, and specifically assesses the implications for Rightmove and the sector generally of the merger of Zoopla with DMGT's property portfolio, which includes Find a Property and Prime Location The merger creates a market duopoly that will put print media under further pressure, though Estate Agents remain attracted to the lead-generation and attractive branding benefits of print distribution and layout Meanwhile, the sector has rebased in scale: while house prices are in aggregate very stable, transaction volumes are still only a little more than half the market peak in 2007
The second of our four reports on specialist advertising focuses on the property sector, and specific [...]October 15, 2012 Reports
Since the onset of the recession in 2008-09, the revenues and profitability of the recruiters, auto dealers and estate agents which purchase print and online advertising media have been impaired by lower transaction volumes, putting pressure on advertising budgets. New digital marketing and communications requirements have further claimed budgets previously allocated to print, which will continue to decline in absolute and relative terms. Recruitment has been the classified vertical with the most rapid print-to-digital transition, to the detriment of regional newspapers mainly. Online offers national reach at a fraction of the cost per listing. Unlike autos or property, recruitment is a fragmented vertical across a number of large job boards and niche sites serving identifiable professions.
Since the onset of the recession in 2008-09, the revenues and profitability of the recruiters, auto d [...]March 9, 2012 ReportsWe forecast print media advertising will be down by about 4% in 2012, with national newspaper display roughly flat, performances we envisage will be seen as a temporary reprieve once the substantially tougher 2013 that we expect to follow is underway. Print media is not out of the structural woods, and even relatively small revenue contraction will amplify pain as the opportunities for further streamlining fixed-cost physical distribution operations are realistically diminishing. Digital is a greater challenge for paper than for screen media, as consumer and advertiser demand continues to weaken, yet publishers struggle to generate the killer service solution to stimulate scale revenue online.We forecast print media advertising will be down by about 4% in 2012, with national newspaper display roughly flat, performances we envisage will be seen as a t [...]February 20, 2012 ReportsNews International is to launch the Sun on Sunday on 26 February, seven months after closing the News of the World. In the intervening period, Trinity Mirror has picked up the bulk of the 55% of NoW copies that have not entirely fallen out of the market since June 2011. The £150 million revenue once generated by NoW is diminished and dispersed among rival publishers and we estimate that even a triumphant launch would likely generate half to two thirds of the income of the closed title.News International is to launch the Sun on Sunday on 26 February, seven months after closing the News of the World. In the intervening period, Trinity Mirror h [...]February 12, 2012 ReportsEnders Analysis co-hosted its annual conference, in conjunction with BNP Paribas and Deloitte, in London on 19 January 2012. The event featured talks by 13 of the most influential figures in media and telecoms, and was chaired by Sir Peter Bazalgette. An edited transcript of notes taken during the speaker presentations follows.Enders Analysis co-hosted its annual conference, in conjunction with BNP Paribas and Deloitte, in London on 19 January 2012. The event featured talks by 13 of t [...]January 27, 2012 Reports
Rumours that News International will consider launching a newspaper to replace the News of the World have circulated for months, and probably only one event can dispel them. Trinity Mirror has picked up the bulk of the 60% of NoW copies that have not entirely fallen out of the market since June 2011, and arguably the longer any launch is delayed the harder it will be for NI to attract them back. The £150 million revenue once generated by NoW is diminished and dispersed among rival publishers and we estimate that even a triumphant launch would likely generate half to two thirds of the income of the closed title.
Rumours that News International will consider launching a newspaper to replace the News of the World [...]November 24, 2011 Reports
Zoopla and The Digital Property Group, DMGT's property portfolio which includes Findaproperty, Primelocation and Globrix, announced a merger on 14 October 2011. Under the terms of the proposed merger, DMGT would receive a 55% interest in the merged entity. A merged Zoopla and DPG will compete more effectively with market leader Rightmove, in a property market scaled down by one-third in terms of the number of transactions. We think the merger will give advertisers a better choice and constrain Rightmove's pricing power, which has seen hefty fee increases on members, most recently in 2010, in 2011 and most recently again in November 2011.
Zoopla and The Digital Property Group, DMGT's property portfolio which includes Findaproperty, Primel [...]October 18, 2011 Reports
National newspaper circulation continued its inexorable decline in September, with daily circulation down 7% year-on-year, although we estimate retail sales value decline was marginal. Sunday popular and mid-market newspaper circulation fell 4% month-on-month, as News of the World buyers continue to drop out of the market; we estimate around a third of ex-readers have not migrated to another title. Publishers are responding to circulation decline in a variety of ways, from churning out bulks to maintain scale, to increasing cover prices, axing international editions and developing their subscriber base.
National newspaper circulation continued its inexorable decline in September, with daily circulation [...]