Monday, October 26, 2009

Display advertising comeback is bypassing newspapers

The increase in online display advertising that seemed to begin this summer hasn't panned out for newspapers.

The tentative comeback in online display ad spending appears to be bypassing newspapers. Signs of the recovery started well enough this summer, as the NYT notes that big marketers like Mercedes began showering hundreds of thousands of dollars on dynamic, 3D display ads in newspapers.

But it was short-lived, as ad networks began getting the bulk of Mercedes’ online budget, thanks to the promise of lower costs and the promise of greater targeting. The NYT’s Stephanie Clifford finds marketers use of online newspaper ads and display networks akin to wearing expensive shoes: for a big debut, marketers will splurge on premium newspaper ads; but it when it comes to everyday business, ad networks make more sense.

The latest earnings reports bear that out. Google (
NSDQ: GOOG) and Yahoo (NSDQ: YHOO), two of the biggest online ad bellwethers, saw display revenues tick up slightly. But when it came to online ad revenues at the NYTCo (NYSE: NYT), its web ads fell 18.5 percent. Gannett’s operating digital revenues were also about 20 percent lower. Meanwhile, McClatchy (NYSE: MNI) posted just a 3 percent gain for web ads.



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