Dive Brief:
- Declining print advertising revenues have lead The Wall Street Journal to consolidate its print edition by combining the Business & Tech and Money & Investing sections and reducing coverage of arts, culture and New York news, the publisher reported Wednesday.
- Editor-in-Chief Gerard Baker made the announcement in a memo that pointed out WSJ is also expanding its digital horizons while ensuring the print newspaper stays on firm financial footing. The changes will likely include layoffs, with all staffers already offered buyouts, according to the Journal
- The Journal reported that fellow publisher the New York Times is also struggling on the earnings front, with print advertising dropping 19% and overall advertising revenue decreasing 7.7% in Q3.
Dive Insight:
Traditional formats like print media continue to struggle as advertising attentions turn more toward digital: The IAB recently released a report that found digital ad revenues hit a record high of nearly $33 billion in the first half of 2016, with almost half those earnings coming from mobile in particular, which has grown 89% year-over-year.
The Journal reports that the ad buying firm Group M forecasts global print ad spend to drop to the lowest numbers since 2009, when the country was in midst of the recession.
However, many advertisers are still playing catch-up when it comes to digital, according to Mary Meeker's internet trends report from the summer, with 65% of spend still going toward traditional formats like print, radio and TV. As more advertisers re-calibrate budgets for a rapidly burgeoning and continually disruptive digital front, print will likely be hit even harder going forward.
Digital poses its own problems for publishers as well, who have to grapple with ad blockers that cost some titles "multiple millions" of dollars in lost revenues. The New York Times has tried to account for poor user experience with digital ads by nixing banner ads in favor of native, but convincing users to shut off ad blockers completely will likely be a hard-fought battle.
