Newsworks recently presented to the industry the conclusions of a huge piece of research that they commissioned earlier this year. The study investigates the effectiveness of Print and Digital in today's connected world.
A quick glance at the Print industry suggests things are not looking great. Whether you look at Newsbrands national daily newspapers or Sundays, circulation or readership, the picture is bleak with approximately a 50% drop off since 2006. Even just looking over the past year, we saw declines of over 10%. In addition, advertising revenues have fallen by over a third in the last 5 years with digital channels taking a much larger share, accounting for a third of all media spend in 2015.
The aim of the analysis was to prove that despite this, Print is still effective and will continue to hold its own as part of an effective media strategy.
Our first response to the research is that we need to be clear as an industry on the data that we focus on to guide us in our investment decisions. While print readership and circulation for Newsbrands are declining, reach has more than doubled since 2011 when we add in mobile, desktop and multi-platform users.
Lorna Tilbian, an influential City media analyst, points to the example set by newspapers during Brexit. An extra 90,000 newspapers sold each day in June in the lead up to the national referendum. Tilbian identifies this as an indicator of how people rely on newspapers for their opinion. It proves that readers are highly engaged with the content, which can translate into a 'hard ROI' for advertisers. In fact, the Newsworks study showed that advertising in newspapers improves the overall ROI by a factor of 3. Looking across our clients, we agree directionally with many of the conclusions from the Newsworks research, although sometimes not to the same extent. Working on an ROI basis with some of the UKs largest brands, we have advised over recent years that despite the reduction in readership, for most brands, investing in print is still the right thing to do in both the short and long term.
In our recent in-depth analysis of response for Thinkbox, we identified that Print drives on average 8% of the total short-term response (up to 3 months after the campaign) driven by media. In addition, we also identified that Print, along with OOH, is the second most powerful medium at driving brand metrics, delivering response over the longer-term (up to 2 years after the campaign). Digital, on the other hand, is the weakest channel at driving longer-term effects.
Looking on a client-by-client basis across our top print spenders, this relationship continues to hold true. In addition, the multiplier effect of Print identified in the study is also clear to see, although less than the factor of 3 that Newsworks suggest. Within the pharmaceutical sector, Print delivers 10% more response when flighted at the same time as TV. This multiplicative effect is replicated in the travel sector, where Print proactively drives sales through the online channels. Its strongest impact is on affiliates, followed by display and search. Another highlight is in the Automotive sector, where we see that combining Print with TV has a stronger impact on brand health measures than just using TV alone, against the core target audience. Across key measures such as Consideration, Purchase Intent, Impression, Value and Reputation, Print drives an additional 3% uplift on the brand metrics.
The Newsworks Effectiveness Study and our own client examples back up that Print is still a strong medium, delivering against short term and longer term measures, both on its own and when used in conjunction with other media.
Nobody denies that Print readership has fallen in recent years. Newsworks however suggests that the industry has been too extreme in cutting print budgets. A 30% drop in revenues in the last five years has already been witnessed with industry forecasts estimating that revenues will continue to fall by 10% every year. Newsworks recommend that optimal investment levels print should be higher than they are currently.
Our own analysis agrees that Print budgets should be higher, not always to the same extent that the Newsworks research shows. The analysis we conduct for our clients allows us to make bespoke recommendations on the optimal allocation of budget between channels, based on maximising overall ROI. In recent years the analysis has suggested reducing print budgets, but not to the extent that the industry as a whole has. Yes Print ROIs have fallen a little, suggesting reallocating spend, but at much more conservative levels.