US survey: More advertising dollars moving online

Posted by Maddie Hanna on June 7, 2006 at 12:09 PM

On Friday, the Newspaper Association of America released estimates that US newspaper advertising increased just 0.3 percent during the first three months of 2006, compared to a 35 percent jump in online advertising — numbers that came days after Merrill Lynch termed the state of the newspaper industry a “deep depressing dive.”

Maybe too strongly worded, but as newspaper analyst Colby Atwood told the New York Times, “The handwriting is kind of on the wall.”

“Increasing amounts of revenue and focus should be on the online properties,” Atwood said. “This is a transition that’s taking place over several years here. It’s not happening overnight, but it’s definitely happening.”

The print advertising industry still trumps the online sector, $10.3 billion to $613 million. But the latest online increase marks the eighth consecutive quarter of growth for Internet ads.

The findings come at the same time as a survey that says the number one media for at-work and daytime use in the U.S. is — get ready for it —the Internet. Not exactly revolutionary. But what’s more interesting is the analysis: while only 8 percent of advertising dollars are currently online, according to CNET, Online Publishers Association president Pam Horan thinks studies like this will cause a surge in advertisers making the leap to the Web.

How can newspapers win the battle? Learn to reap the Web’s benefits, says Jason E. Klein, president and chief executive of the Newspaper National Network. He told the New York Times: “I think this industry is in for exceptional long-term growth from online revenue.”

The newspaper industry doesn’t have to take a deep or depressing dive. It just has to develop a better online advertising model.

Source: The New York Times (through Ifra Executive News Service), CNET News (through I Want Media)