Commentary

Gains In Digital Publishing Revenue Signal Recovery For UK

by April 27, 2021

Numerous publishers saw a jump in web traffic as pandemic lockdowns kept people at home — where they spent more time with digital news and entertainment. Fortunately for publishers in the U.K., that increased activity translated into healthier sales toward the end of last year.

Digital publishing revenue in the country increased by about 13% from a year earlier to £165.1 million ($229 million) in the fourth quarter, according to the Digital Publishers’ Revenue Index from the Association of Online Publishers and consulting firm Deloitte.

That gain wasn't enough to overcome the declines from earlier in 2020, when many advertisers canceled or delayed spending as lockdowns sent the economy into a tailspin. Digital revenue slipped by 0.8% for the full year, including a 0.6% slide for business-to-consumer and 2% decline for business-to-business publishers.

By the fourth quarter, marketers had ramped up their digital ad spending to reach consumers shopping online during the holiday season. Display advertising maintained its spot as the biggest revenue category, with a 17% gain from a year earlier to £78.4 million ($109 million) during the period.

Subscription revenue jumped 44% during the quarter as publishers sought to monetize their content with digital paywalls, according to the report. That increase is another sign of how publishers are adapting their business models amid growing competition from search and social media.

As for pockets of weakness, help wanted ads saw a 24% decline in the last three months of the year, indicating that many employers were cutting headcount or had suspending hiring. Sponsorship revenue fell 19%, while online video slumped by 14% as spending shifted elsewhere.

The revenue B2C publishers boosted digital revenue almost 15% to £152 million ($211 million), amid 56% gain subscriptions and 34% jump in miscellaneous revenue. B2B publishers saw a 0.4% slide as gains online video and miscellaneous weren't enough to offset the slump in sponsorship and help wanted ads.

Dan Ison, the lead partner for telecommunications, media and entertainment at Deloitte, attributed the recovery in digital publisher revenue to growing demand for trustworthy news amid the proliferation of "fake news" on the internet.

“This has provided the digital publishing industry with a strong foundation for future growth and a clear direction for innovation," he stated. "Publishers must continue to fortify their readership's loyalty and trust, while investing in multi-platform content development.”

digital, online publishing

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