Growing Social Media Ad Spend Bad News for Newspapers

In forecasts released today, advertising agency Zenith Optimedia predicts that global ad spend on social media channels will account for 20 percent of all online advertising by 2019, reaching $50 billion and falling just short of newspaper ad spend. Dramatically, it also forecasts that social media spend will overtake spending on newspaper advertising “comfortably” by 2020.

According to Zenith, budgets are shifting to online ads which blend easily with user newsfeeds rather than intrusive banner advertising. Overall global ad spend will continue to be stable.

The threat to newspaper ad spend from social media comes at a time when doubts are being raised about the wisdom, in the US at least, of traditional print papers investing heavily in their online properties. In an essay published in July, 2016—tellingly titled “Reality Check”—University of Texas researchers argued that digital offerings from major US newspapers are proving “unsuccessful.” Analysis of data from 51 newspapers showed that “the (supposedly dying) print product still reaches far more readers than the (supposedly promising) digital product in these newspapers’ home markets.” Even though the print market is shrinking, digital advertising revenue remains insignificant compared with print.

Together with the Zenith forecasts, newspapers should be concerned at a trend away from both print and online banner advertising.

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