Magazine article Marketing

Media Analysis: Press Feels the Pinch

Magazine article Marketing

Media Analysis: Press Feels the Pinch

Article excerpt

National newspapers may find themselves vulnerable in a bleak fourth quarter.

The current supermarket price war has done more than knock down the prices of essentials at a time when consumers have a heightened awareness of the cost of household goods. It has also helped alleviate a little of the pressure on the national press advertising market, which has suffered more than most from the tightening of marketing budgets.

Modest declines in national press spend in the first half of the year have been followed by more significant dips over the summer. Media agencies estimate that the figures for August could return a year-on-year decline of up to 10%. Without the price war, with supermarkets Asda and Tesco battling over the cost of milk and other basics, as well as the move toward full-colour printing, which has enabled publishers to charge a premium, the picture would have looked bleaker still.

To make up for the shortfall, the newspaper industry has become reliant on a much-anticipated fourth-quarter spending bonanza by advertisers in the lead-up to Christmas, particularly in the retail and entertainment sectors, which traditionally spend about 25% of their annual budgets on press advertising in this period.

Uncertain prospects

However, the newspaper industry doesn't yet know whether this fillip will materialise, and media agencies have confirmed that faltering confidence in consumers' willingness to spend is leading to reluctance among advertisers in all sectors to commit to Christmas promotions.

This, in turn, is holding agencies back from planning crucial Christmas activity. Rob Lynam, account director at Mediaedge:cia, believes that the press market will face a turbulent end of year. 'Christmas 2007 was buoyant, but this year will be different,' he says. 'People aren't spending on credit like they were 12 months ago. Consumer purchasing will be different, and that will have an impact.'

Louise Green, associate director of national press at MediaVest, adds that there will be a Christmas uplift, but that it will begin later this year, as advertisers' budgets deny them the luxury of an extended build-up. …

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