Advertising revenue from newspapers and news websites is up in the second quarter of 2018 with digital ad expenditure increasing by 10.8 per cent, according to the latest News Media Index (NMI).
Using data collated by Standard Media Index (SMI), the NMI found national newspapers have reported positive growth in direct ad revenue for the second consecutive quarter, up 5.5 per cent into $5.7 million in Q2, building on the growth seen since Q2, 2016.
Digital ad revenues from news websites have grown 10.8 per cent in Q2 to $135 million, with the largest growth evident in the programmatic market, up by 52 per cent to $33.4 million.
Metropolitan newspapers have shown the biggest recovery, with media agency ad spend down just 1.8 per cent and the total metro newspaper sector (including direct advertiser spend) down a modest 2.9 per cent.
Australia’s news media sector remains the third largest media sector by ad revenue, reporting $2 billion for the full 2018 financial year.
The industry’s decline has almost halved in the past quarter, with total news media ad spend back just -3.7 per cent in Q2 to $494.4 million, compared to -7.3 per cent in the first quarter.
This is well below the latest SMI agency-only ad spend data, which showed a decline in print spend of 14.1 per cent in Q1, although its figures are also expected to moderate in the Q2 period.
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 markets, although the media agency sector has significantly improved.
For example, total agency spending on news media declined by 7.2 per cent in Q2, but the total newspaper decline was less, at 4.8 per cent.
Agency spending on print display was back just 3.4 per cent and spending on catalogue inserts declined by only 1 per cent.
Total spending on inserts grew 7.3 per cent this quarter to $17.7 million.
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.
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NewsMediaWorks CEO Peter Miller, said, “The News Media Index Q2 numbers are encouraging to say the least. They indicate a long-awaited review by agencies of media investment priorities.
“Advertisers have in all likelihood been asking the hard questions about why they are spending big dollars to reach millions of bots on non-news websites.”
“I think the sales operations of the news media companies deserve great credit.
“They are talking to advertisers directly about the power of newspapers and the value of premium websites, whilst investing heavily in their online presence.
“And they are doing excellent work developing strategic proposals for advertisers across print, digital and video and producing top-class branded content. All this is creating a perfect storm of the very best kind. Further improvements lie ahead.
“The renaissance of the most trusted media channel for content and ads is well underway,” he added.
SMI AU/NZ MD Jane Ractliffe, said the 3.7 per cent decline in second-quarter news media ad spend was the lowest since the NMI records began in 2014.
“The story of this data release really is the stabilisation of media agency spending to news media, and in particular the print products.
“For example, the NMI is reporting a 7.3 per cent increase in agency bookings to Melbourne metropolitan mastheads and static agency spending for the Brisbane and Tasmanian mastheads,’’ she added.
“It’s another positive step in the turnaround we’re seeing in the print sector overall, accompanied by continued growth in digital ad spend.”