Online Ad Spend Hits A Tipping Point As Print Plummets, Again

It has happened. We have reached the point in the UK where more than half of all advertising revenue goes online, according to the latest AA/Warc figures. The news comes as Q1 saw a 10% lift in online advertising and a 36% rise in mobile. This is massive growth during a quarter that conversely saw the slowest overall rise in overall spend in four years, at just 1.3%.

So with overall growth slowing but online and mobile rocketing, there can only be one conclusion. Digital's gains are coming at the cost of another channel. And by the way, that channel is most certainly not cinema. Not sure about you, but I've had plenty of chats with adland execs about how the huge blockbuster movies of the past year or so have not only meant there's always something you want to watch at the movie theatre, but there are plenty of corresponding ads too. At a touch over 27% growth year-on-year, for the first quarter, cinema has seen double the growth, percentage-wise, as internet advertising. 

Cinema is going through a renaissance. If you ever need an example of how the experience economy needs to be taken seriously, the massive increase in cinema attendances and ad spend is a good place to start. 

No, sadly, digital's gains are at the expense of print brands. Now, of course, many of these are making digital gains, but not enough to make up for their losses. When I looked at figures recently it looked like, as a rule of thumb, one can say that for every GBP10 print brands lose in print, they make just GBP1 back in digital gains.

Looking at the figures from AA/Warc today, it's pretty dismal reading for print brands. As a journalist from a print background, I take no pleasure in reporting the figures, but to hide them serves nobody. While tv and national news are down 6% for the first quarter year-on-year, magazines are down nearly 14% and regional newspapers a massive 16%. 

Television, one can imagine, might perk up a little next year when there is a major soccer tournament -- but is likely to see only modest growth, if it returns, as brands supplement reaching the front room with digital video advertising, such as YouTube campaigns.

National newspapers won't be happy that they are down 6%, but can many have moved -- or like the The Guardian, are considering a move, to pay walls which may offer hope increased subscriptions bridge the gap as overall ad revenue declines.

For magazines and regional newspapers, however, it's just so sad to see. Talking with colleagues with whom I've shared a writing background, the talk is only ever of titles closing and massive job losses at the likes of Time Inc (formerly IPC) and Hearst and how the rate of closures or amalgamations of local news titles is startling, as are the accompanying job losses.

So the point is that digital is no longer an exciting add-on to campaigns. For many years now it has been a supplement, and now a replacement to traditional channels and nobody is bearing that loss heavier than magazines and local newspapers.

Sadly, from what I see, all we can expect is more of the same, as digital gains nowhere near cover print advertising and circulation losses.

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