Print fight gets rough, but digital mission will be bloody too

Big battles lie ahead, as media groups report accelerated decline in print advertising

 Facebook: gets 14 cent out of every euro spent on digital advertising in Ireland.  Photograph: Reuters/Dado Ruvic

Facebook: gets 14 cent out of every euro spent on digital advertising in Ireland. Photograph: Reuters/Dado Ruvic

 

A young man spots a recruitment advertisement by the Irish Defence Forces in a newspaper. A thought bubble emerges from his head. “Hmm, maybe a career in the army is the one for me.” He folds away the newspaper, logs on to a computer and types Military.ie into the URL bar.

Now here is what actually happens. The young man is on his Facebook smartphone app when he spots an ad showing what life might be like in the army: teamwork, physical challenges, more teamwork, maybe even some cool rifle stuff. He watches a video that tells him he’s been training for this job all his life. He clicks through to Military.ie.

Newspapers are just “not where our demographic is”, says Sgt Rena Kennedy from the Defence Forces press office.

Kennedy recently asked a bunch of teenagers if they read a newspaper, she told Measurement, a digital and social media conference in Dublin last week. “And there was loads of laughs and giggles, and ‘my granny reads the paper’.”

The Defence Forces are on a mission to scoop up about 1,450 young people in the next two years, and to reach them, it has added Snapchat and Instagram to a social media arsenal that already included Facebook and Twitter.

Logic and efficiency

In its most recent recruitment campaign, it ran paid ads on YouTube and Facebook, and got snapchatting - there are plenty of 18- to 24-year-olds on Snapchat. It’s the kind of logic, efficiency and understanding of human behaviour that one would hope from people in charge of weapons.

And as an illustration of what has happened to print advertising, it couldn’t be blunter. Advertisers that want to recruit people, either literally into the army or in the consumer loyalty sense, need to go where they can find them.

Awkwardly, it is not just those advertisers chasing 18- to 24-year-olds that have reallocated their budgets. Those targeting 25- to 54-year-olds have also rethought their options. They are, as Independent News & Media (INM) chief executive Robert Pitt put it this week, looking for “more complex solutions to reach their target customers”.

In Britain, the trend is more obvious. Big advertisers have shifted wads of cash away from print. The Daily Mail and Mail on Sunday’s print advertising revenues tumbled 16 per cent in the six months to the end of March, while at Trinity Mirror, print ad revenues in the first four months of 2016 slumped 19 per cent.

Even the Financial Times, which at least has a solid revenue stream from its digital paywall, has warned of “daunting trading conditions” and told its staff that its commercial team is “braced for tough times in the months ahead”. The Guardian and the Telegraph have already announced job losses and the Independent ceased printing in March. Caution ahead of the Brexit v Bremain referendum has not helped, but most of the problem is structural: print is losing out to digital.

And sadly, digital advertising doesn’t pay anything like as much, nor do publishers have the space to themselves.

Excellent result

Google and Facebook loom larger than ever, their shadows extending over both the more mature mastheads that straddle print and digital and the new generation of digital media brands. The latter would like to think they have little in common with what they regard as the staid culture and bloated operations of newspaper groups, but their relative fleet of foot isn’t enough in itself to protect them from Silicon Valley’s great revenue suck.

The Irish market may be different from the British one in many respects, but on this broad point it is dispiritingly similar.

Digital advertising revenues are growing faster in Ireland than anywhere else in Europe, according to figures compiled by IAB Europe, but Google takes about 52 cent of every €1 spent on digital advertising in Ireland, while Facebook’s share is 14 cent and growing. This leaves just 34 cent for the rest of the market.

After a prolonged recession, there was relief all round when news media advertising revenues posted an increase in 2015. Print ad income rose 2.3 per cent and online ad revenues surged 20 per cent, according to Core Media, which hailed it as an “excellent result”. Newsbrands Ireland, meanwhile, said combined print and digital ad revenues climbed 5.5 per cent at its 16 member titles last year.

That was last year. On Thursday, Independent News & Media said growth in digital ad revenues had not been offset by the accelerating decline in print advertising from January to April.

So the tactical dilemmas faced by the industry over the past decade are likely just a warm-up for the Army-style obstacle course that lies ahead. Few in the industry, however, are defeated just yet.

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