Online Helps Offset Decline in Media Company Revenue Last Year

According to American Business Media's 2009 Media Financial Survey, B2B media company revenue declined 2.2% in 2008 versus 2007, but revenue growth in online, live events, and data products helped offset declines in revenue for magazines. B2B media company profitability contribution (revenue less operating expenses) declined 7.8% in 2008 versus 2007.

US B2B Media Company Print Revenues (Millions and CAGR)

 

2006 ($MM)

2008 ($MM)

CAGR (%)

Magazine Advertising Revenues

 

 

 

   Display

$902

821

-4.6%

   Classified

44

35

-10.3

Magazine Circulation Revenues

 

 

 

  Subscription

115

110

-2.4

  Single-copy

9

7

-8.7

Other Print Revenues

169

171

0.5

Total Magazine Revenues

1,239

1,144

-3.9

Data Revenues

33

42

12.3

Custom Publishing Revenues

41

40

-1.1

Grand Total Print Revenues

1,313

1,226

-3.4

Source: ABM 2009 Media Financial Survey, April 2009 (rounded)

Of the six key B2B media company revenue categories (Magazines, Custom Publishing, Data, Online, Tradeshows and Conferences), Online revenue showed the strongest growth, increasing 15.1% in 2008, and rising at a CAGR of 26.8% from 2006. Magazines were the weakest performers, showing an 8.4% decrease in 2008, and a decline of 3.9% on a CAGR basis over the three?year period.

US B2B Segment Online Revenues

 

2006 ($MM)

2008 ($MM)

CAGR (%)

Display & Search advertising

$119

$203

30.7%

Data

21

61

71.6

Lead generation

16

27

30.4

E-Newsletter subscriptions

4

14

82.4

Webinars

3

10

92.6

List rentals

6

7

14.4

Other

57

39

-17.0

Total

$224

$360

26.8%

Source: ABM 2009 Media Financial Survey, April 2009 (rounded)

Online display and search advertising gained 12.4% in 2008 while magazine net ad revenue declined 10.2% in 2008 and fell at a CAGR of 4.9% over the three?year period. Tradeshows grew 4.3% in 2008. Data and conferences also showed robust revenue growth, increasing 7.0% and 9.9%, respectively, in 2008, though custom publishing remained relatively flat in 2008 and across the three?year period.

Except for magazines, all major B2B media company revenue categories increased on a contribution basis in 2008 and across the three?year period of 2006 to 2008. Key magazine operating costs, including Ad Sales, Editorial and Production, have not declined in line with revenue, and therefore, have negatively affected magazine contribution, which decreased 26.8% in 2008,

Online contribution showed the strongest growth in profitability, rising 11.6% in 2008. Online overtook magazines as the largest component of B2B media company contribution in 2008, says the report. In addition, versus 2007:

  • Data contribution grew 10.9% in 2008
  • Tradeshow contribution increased 4.5% in 2008
  • Conferences and custom publishing also showed contribution growth of 5.9% and 2.7%, respectively, in 2008

in Q4 2008 vs. Q4 2007, B2B media companies showed relatively flat revenue, while advertising dollars continued shifting from print vehicles to online outlets.  magazine net ad revenue declined 15.7% in Q4 2008, while online display and search advertising revenue grew 28.3% quarter?over?quarter. Tradeshows were hurt by declines in exhibit space sales and attendee revenue.

Gary Fitzgerald, CEO of Meister Media Worldwide and chairman of the ABM, said, "It's a time of great opportunity."

Read the ABM report here

 

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1 comment about "Online Helps Offset Decline in Media Company Revenue Last Year".
  1. Kathryn Koegel from Primary Impact , May 19, 2009 at 9:21 a.m.

    Online display might not be in the dire straights so much of the media has reported -- if you pick apart the earnings reports of even the top newspaper sites you see that display is actually growing, it's the classified that are pulling everything down. For more info on display ad spending and guidance on better measurement practices, there is a new whitepaper available with data from Nielsen, comScore, Dynamic Logic and Microsoft Atlas: www.primaryimpact.com/stateofdisplay.html