Publishers Report Q1 Ad Revenue Is Pacing 10-25% Behind Forecasts
The first quarter is off to a rocky start for publishers’ advertising businesses, and while that might not come as a surprise given the state of the economy — even for media execs who forecasted their companies’ revenue goals according to the headwinds in the market — January is pacing between 10% to 25% off their projected targets, according to three media executives. Three other execs profiled for this piece said their business is approximately even with Q1 2022.
“We’re coming off a Q4 [2022] that was up 30% to 31% in direct [advertising revenue], which was epic. And I think whatever bug [our competitors] had in Q4 caught up with us in Q1. We’re down right now as much as 20% to 25% in our forecast for Q1,” said an executive from a digital media company who was permitted anonymity in exchange for candor. And according to that exec, they haven’t ever had a down quarter, aside from Q2 2020 during the first three months of the pandemic.
Two other large digital media publishers told Digiday on the condition of anonymity that their businesses were about 75% booked for Q1 as of Jan. 25. For one of the execs, this was well behind the goal for amount of inventory booked that they normally set going into a new quarter. Meanwhile, the other exec said that this was actually pacing about 10% up year over year as much of their business is sold in-quarter typically.
Paxton Media Group Tells At Least Some Local Papers To Close Their Offices To The Public
One of the nation’s leading rural newspaper chains is planning to close at least some of its papers’ local offices to the public this week. In an email to local and area managers, Paxton Media Group said, “To help streamline our efficiencies and processes, and to keep pace with changes in our own industry, we’ve decided it’s best to eliminate our open office hours to the public completely, for the remaining publications in our group.”
The meaning of “remaining publications in our group” was unclear. The memo seen by The Rural Blog was sent at least to managers of some papers in Kentucky and southern Indiana, and was a topic of discussion among Kentucky employees last week.
The memo was sent last week and gave a target date of Wednesday, Feb. 1. Paxton managers declined to comment or did not respond to requests for comment on such questions as possible layoffs.
At The Seattle Times, 70 Percent Of Revenue Now Comes From Readers
Intensely focused on reader revenue for more than a decade, Fisco credits The Seattle Times’ success in large part to its high quality, local content. Winner of 11 Pulitzer Prizes, the Times has 176 journalists, which makes it the second largest news staff in the western United States after the Los Angeles Times. Twenty-seven of those positions, or 15 percent of the total newsroom staffing, are funded through the Times’ philanthropic funding work, which helped them to add 11 newsroom positions in 2022, Fisco said. The past couple of decades have not been without their challenges and hardships, however. “We, like many of you, have been forced to cut expenses and cut staff over the years as advertising revenues have declined pretty precipitously. But when we’ve done that, we’ve tried to do everything we possibly can to protect newsroom positions,” Fisco told participants at WAN-IFRA’s World News Media Congress late last year. The Seattle Times has been locally owned and independent for more than 125 years, he said, adding, “We take great pride in that local ownership and believe it is one of the cornerstones to our success.” Fisco himself has been at the Times for more than 30 years and its president for the past five.
An early decision to focus on reader revenue The Times made the strategic decision to move its business model away from a reliance on advertising to one that was audience focused more than 10 years ago, long before most of its peers. “At that point everybody was still saying digital advertising was going to be the savior for us,” Fisco said. “What we were seeing was declining rates. Modest growth, but single digit growth. We strongly believed that we needed to make a pivot organizationally and focus on content, which really is our unique differentiator.” Today, 70 percent of The Seattle Times’ revenue – both print and digital – comes from its audience. However, Fisco said 70 percent of that 70 percent is still coming from the print side of its business. For example, they have 130,000 print subscribers vs about 82,000 digital subscribers. Advertising represents a further 24 percent of revenues, and that is split evenly between digital and print. “So, clearly you can see we’re still very dependent on print revenue,” he said. On the digital side, the paper uses a metered paywall, which it launched in 2013. In 2015, the company invested in a new digital tech stack both front and back-end. “That was a two-year process,” Fisco said. “We’ve spent the years since that installation tweaking it to make it even better.” Those efforts really paid off in 2020 and 2021 as Seattle became the epicenter for the Covid outbreak in the United States. “We suddenly had this giant influx of page views and digital subscriptions both locally and internationally. Had we not done that work in advance, we would never have seen the growth that we have experienced,” Fisco said.
The Houston Landing Launches: Local News For The Greater Houston Area
More than a year ago, researchers studying local news in the Houston metro area learned something critical to the launch of the Houston Landing.“The community often times feels left out of the news,” said a nonprofit director in east Harris County, who was one of hundreds of residents who participated in the study. “I think there’s a lot of feelings of being forgotten, being left out, and the light not being shined on the community since [Hurricane] Harvey.”It shouldn’t take a natural disaster to make our communities feel heard, seen and valued. It just takes a vision that is as big and bold as Houston. This is why we are announcing today the launch of Houston Landing, an independent nonprofit news organization devoted to public service journalism that will be digital-only and nonpartisan.
Houston Landing’s mission Our mission is to strengthen democracy and improve the lives of all Houstonians one story at a time. Because we want to serve as many people as possible, our content will always be free, with no paywalls or subscription fees. It will also be available for other media organizations to publish. The American Journalism Project, which helps build nonprofit newsrooms, conducted surveys, interviews and focus groups with residents of Greater Houston. The message was clear: People do not feel they have access to the trustworthy, local and deeply reported stories they need for their daily lives. We’re trying to fix that. The Houston Landing will provide trusted reporting about local issues important to our region, stories that offer solutions to pressing problems and investigative journalism that keeps the powerful accountable. The Landing (we’ll get to the story behind our name shortly) will focus on watchdog coverage of governments and institutions in Harris County and our suburbs. We will tell stories that reflect the region’s dynamic diversity.We will offer stories and information that help residents make decisions about their daily lives — from accessing public services to participating in democracy — empowering them to engage in their communities and city.
