Commentary

Newspaper Ad Spending Extends Recovery, Magazines Lag

Media spending continues to recover as the U.S. economy reopens, though publishers are seeing uneven results, according to data compiled Standard Media Index. The data and analytics firm last week said the U.S. advertising market expanded by 56%in May from a year earlier, a bigger gain than 53% for April and 22% for March.

Newspapers are participating in that recovery, with ad spending that rose 10% in April and 8% in May. Those yearly growth rates are unlikely to be maintained, considering that April and May last year marked the beginning of a deep but short-lived recession as pandemic lockdowns went into effect. Newspapers will have a higher hurdle to clear in the months ahead.

Magazine spending fell 21% from a year earlier in May and by 20% in April, though it's a considerable improvement from the 34% plunge in January. Print titles will continue to face pressure in the months ahead, but that isn't a complete surprise amid the longer-term shift to digital publishing.
Digital ad spending jumped 69% in May and 84% in April -- again jumping over a low bar. That growth should be positive for digital publications, even if internet search and social media likely captured most of the rebound.
It will be interesting to see how much digital growth will slow in the coming months as consumers pry themselves away from their screens and get outdoors more often. There are signs that the lifting of pandemic restrictions has led many people to resume former activities like commuting to work, traveling by plane or going to the movies.
These changes were reflected in ad spending, with out-of-home surging 98% from a year earlier in May and radio jumping by 122%. Those growth rates will be hard to sustain, but they are a welcome indicator that the threat of COVID-19 has subsided.

Going forward, the recovery in ad spending is likely to remain uneven, challenging publishers to grow revenue aside from advertising.

Next story loading loading..