Newspapers project 15% growth in 2010 online ad revenue

The Kubas Consultants survey includes 96 Canadian newspapers and predicts print ad rev will 'decline less quickly' next year.

It’s not quite the beginning of the turnaround, but daily newspapers are expecting 2010 advertising revenues to generally improve after a rather dismal 2009.

Toronto-based Kubas Consultants polled 532 daily newspaper executives and managers in late November 2009 for the ‘Preview 2010′ survey, including 96 Canadian papers with circulations ranging from under 25,000 to over 100,000.

Newspapers expect online ad dollars to lead the way, with 15% growth over the next year. For print ads, however, the outlook was less than rosy, with amounts ‘declining less quickly’ than expecting positive growth.

Employment classifieds is predicted to be the weakest performer with a -7.5% landslide, with moderate declines also expected in real estate (-2.7%), automotive (-2.8%), national (-3.4%) and other classifieds (-5.2%). Retail ROP (-0.4%) and distribution (-0/8%) – including preprints and direct mail – are also projected to lose slight traction. In fact, Kubas predicts that all ad revenue categories except for online will register in the red.

Newspapers also outlined their 2010 strategic objectives, and said most are web-based: improvements for site advertisers and visitors are in the cards, as is the generation of online self-serve ad sales. The dailies are all looking for ‘significant’ online revenue gains in order to meet their bottom lines.

Improvements to ad pricing structures and sales technology upgrades are also on the radar, although operating budgets are likely to tighten even more as print continues to weather through difficult times. Additional cost reductions such as outsourcing advertising sales and printing operations and reducing the number of publishing days per week are not being considered at present.

As far as boosting revenues, some North American dailies are mulling over charges for online content. Kubas reports that although newspaper websites generally experience high volumes of local market traffic, monetizing that traffic remains the big issue.

Kubas also says that although basically all papers are looking to control or reduce staff costs, one in four also have plans to start a specialty, niche or lifestyle product.