By: Lucia Moses Advertising spending at newspapers continued its slide in the second quarter, when the industry faced tough comparisons with the year-earlier quarter, according to preliminary figures from the Newspaper Association of America.
Ad spending declined 8.4% to $11.1 billion, after slipping 4.28% to $10.4 billion in the first quarter, the figures show. Newspapers, which are seeing their worst financial performance in a decade, logged a 6.5% decline in ad spending for the first half of 2001, to $21.4 billion.
The results were not unexpected, given the state of the economy since the second quarter of 2000, when newspapers enjoyed a 6.8% increase in ad spending, said NAA President and CEO John F. Sturm.
"Basically, we've given up a billion and a half dollars in ad spending that we had last year," he said. "That's not good, but it's not cataclysmic."
Sturm said the industry is well-positioned for significant profit growth when the economy improves, thanks to declining newsprint prices, cost-cutting measures by newspapers, and their ability to deliver large audiences to advertisers at a lower cost than other media.
In the second quarter, classified advertising showed the steepest percentage decline, reflecting the downside of strong gains in help-wanted in earlier years. Classified declined 15.5% to $4 billion, led by a 33.4% drop in recruitment, its biggest category. National declined 8.5% to $1.9 billion while retail slipped 2.2% to $5.3 billion.
In other classified categories, real estate continued to thrive, increasing 8% to $782 million in the second quarter, reflecting the strong housing market. Automotive declined 3.5% to $1.1 billion, and all other classified advertising was down 4.8% to $652 million.
Results should improve in the second half as newspapers go up against easier year-over-year comparisons in the third and fourth quarters.
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