For Newspapers, Slide in Advertising Revenue Continues

Monday July 6, 2009

There's more bad news for newspapers: Ad revenue was down for the first quarter of this year.

Overall ad sales for print fell 30 percent in this first quarter of 2009 compared to the same quarter last year, according to Business Insider. Classified ad revenue, siphoned away by Craigslist, plunged 42 percent in that period.

That's the steepest year-over-year drop ever.

And if you think online ad revenue will save the day, think again: Online ad sales fell 13 percent in the same period. That's the first first double-digit drop in online ad sales since the Newspaper Association of America started measuring them in 2004.

Total U.S. online advertising in the first quarter fell 5 percent compared to last year.

Newspapers have always relied on ads from big-box department stores as a major revenue stream, so it's no surprise to learn that Macy’s has halved what it spends on newspaper ads since 2005. That's $616 million in lost ad revenue.

What to do? Aside from praying the economy will pick up soon, no one really knows. One option might be cooperative arrangements like the one between the Tribune Co. and the Dallas Morning News. Under the deal, Tribune Co., which is itself in bankruptcy, will sell national print and online ads for the Dallas paper. The hope is that centralizing sales through a single clearinghouse will make ad buys easier for large companies.