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Newspapers, B2B Losing Online Adspend Share

Clever Newsosaur Analysis

Blame the robots, blame retargeting, or blame the great comet ISON; whatever the cause, traditionally high-priced targeted media sectors newspapers and business to business publications are finding they are increasingly losing out in the race for online ad dollars. The dollars are growing - they're just not going to the older, more traditional ways of targeting certain audiences.

Newspapers, which traditionally have commanded premium prices because of their ability to target specific geographies, and have seen online as their only recent bright revenue spot, aren't keeping up their share. And B2B publishing firms are finding revenue hard to come by in any medium, as retargeting - the practice of finding high-value individuals on a targeted site, but then spending ad dollars on cheaper, general media sites targeting those very same targeted individuals - appears to be eating the online share they had been growing.

Even as B2B publishers throw print overhead costs overboard and concentrate their efforts on creating more and higher quality online inventory (the most recent example being the recent launch of online-only Residential Builder), they are seeing the online ad buyers skip them over.

Just five years ago, a general audience of one million people looking at a page once a week might be able to generate average annual advertising revenue of $32,000, assuming a $2 CPM and a 30 percent paid sale of inventory. That same revenue could be generated by one percent of the audience size in the B2B context, each person viewing an average of one page per business day, with a $35 CPM rate with 70 percent of media sold.

Today, these two theoretical sites are in direct competition with each other, the "untargeted" one now getting a higher CPM thanks to targeting technologies that allow it to reach B2B customers and others, the B2B site selling less of its inventory and having to lower its CPM to do so.

One asset the newspapers and B2B publications have - and have not yet been keen to sell - is the ability to identify their customers for those very data companies that have been helping other publishers take away their advertising dollars. The opportunity to have this make up a significant portion of lost revenue may be lost to search firms and others with alternate ways of getting at those identities. Meanwhile, the Internet Advertising Bureau, once the organization advocating most loudly for the interests of traditional publications in their online efforts, is pushing to enshrine the data companies' legal freedom to do so.

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