Pete Flint’s Blog

A blog from Trulia's CEO and co-founder

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Where are all the newspaper advertising dollars going?

Written by Pete Flint, Real Estate Pro in San Francisco

March 27, 2009 11:32 AM Agent2Agent

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I saw this morning that the Newspaper Association of America released the 2008 figures for advertising revenues. Here is the news:

Total newspaper advertising revenue fell 16.6 percent in 2008 over the previous year to 37.8 billion dollars.
Print advertising revenue fell 17.7 percent to 34.7 billion dollars while online advertising revenue dropped 1.8 percent to 3.1 billion dollars.
Classified advertising revenue continued to plunge falling 29.7 percent to 9.97 billion dollars in 2008.
Real estate classified spend fell 38% to 2.5 billion dollars.

More charts below.

Many people have been asking where the advertising dollars are going? Scott Karp has a great post on this using the recent closure of the print edition of the Seattle PI as an experiment. He says:

Logically, one or a combination of the following will happen to the newspaper’s advertising dollars:

Vaporizes, i.e. the advertiser stops spending the money — given the economic crisis, this seems likely for some advertisers
Shifts to Seattlepi.com — which is hiring its own sales force following the dissolution of the joint operating agreement with the Seattle Times
Shifts to another newspaper, i.e. Seattle Times — through the JOA, the same sales force sold ads for Seattle PI and Seattle Times, so it only makes sense that some advertisers will shift some or all of their spending to the Times
Shifts to competing local online media, e.g. The Stranger, West Seattle Blog
Shifts to non-local media that can target local audiences, e.g. Google, Craigslist (inc. Trulia.com)

What do you think will happen?

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Comments

By Hugo Torres, Fri Mar 27 2009, 22:02

Though I agree that printed periodicals are loosing readership, revenue and relevance I see that the news business continues to explode and is looking for a new venue where it can thrive.

The internet is an obvious place for newspapers to target but with the Kindle 2 recently released, I see a world where newspapers can regain market share and give REALTORS another platform in which to advertise.

For now, we still advertise in the major newspapers (Los Angeles Times) because their readership is sizeable and our clientele deems it a necessary marketing tool.

Finally, I don't think newspapers will become extinct. We still need them as a portable entertainment source. Afterall, its hard to take a lap top to the bathroom and I'm certainly not taking my Kindle.