Online advertising is booming. Already a $32 billion business, advertisers are expected to spend a full $62 billion online in 2016. But news publishers are not poised to cash in on the growth, a report released Monday by the Pew Research Center suggests.
The problem? News publishers’ online advertising products simply aren’t competitive. Most tend to depend on static, un-targeted banner advertisements, making their products less desirable than the highly targeted advertisements offered by the likes of Facebook and Google.
Among the other findings:
- 21% of ads on an online news site are for the news organization’s own products.
- By category, the financial industry is the largest spender in online news advertising (18%), followed by cosmetics and toiletries (5%).
- Most ads are static banner ads. Rich media and video ads are rare.
- Few legacy print customers are moving to digital
A detailed study that shows newspapers losing $7 from print for every digital $1, without even a sense of how they are addressing a key aspect of that transition. It’s an unfortunate vacuum.
One exec bluntly states, “There’s no doubt we’re going out of business right now.”
This unfortunate state of affairs is costing the newspapers $25 billion this year and success stories are rare. One success I was able to find comes the The Atlantic magazine, a much smaller company pulling in $18 million in advertising.