Owings Mills, MD (PRWEB) November 21, 2005
Despite circulation woes, newspaper ads continue to increase
Despite the continuing circulation slump experienced by top U.S. newspaper publishers, advertising spending for the medium has risen steadily throughout the last quarter according to global trade credit insurer Euler Hermes ACI. Meanwhile, advertisers have been turning more to alternate outlets to reach consumers.
A recent study by Euler Hermes ACI said the newspaper industry continues to suffer from circulation problems according to circulation numbers for the six-month period to September 2005, with reported declines for 18 of the 20 largest U.S. newspapers. “The subscription declines have come at a period when there are many more news outlets in the U.S. – such as cable television news networks, Internet sites, and email and cell phone alerts,” said Euler Hermes VP-Risk Industry Manager Tony Clary. “This freedom of choice did not exist 20 years ago and has led the print media to try and capitalize on the new outlets. For example, many newspapers have substantial and free online sites offering much of what is also offered in print.” Clary added that the newspaper websites do not adversely affect overall readership, but can reduce the newspaper's paying audience.
While the newspapers are highly dependent on advertising income, a look at the U.S. advertising expenditures suggests that advertisers are not nearly as dependent on newspapers. Total advertising spending has increased for each of the past three years and also to date in 2005. Despite the circulation drop, advertising spending in local and national newspapers has actually increased for each of the past two years.
However, the real growth for advertising spending appears to focus on the Internet. For example, national newspaper advertising spending increased by 5.8% in 2003 and 6.6% in 2004. Meanwhile, Internet advertising spending saw increases of 15.7% and 21.4% for the same period.
“The alternative advertising avenues that are resulting in reduced newspaper circulation are actually proving to be fortunate for the advertising companies," said Clary, who oversees the risk industry team responsible for tracking trends in advertising, as well as the metals, automotive, lumber, building products, and paper industries.
Euler Hermes ACI is the U.S. subsidiary of the Euler Hermes group – with offices in 40 countries around the world – and a company of Allianz. Through its worldwide network, the Group monitors the credit worthiness of 40 million companies involved in numerous industries around the globe. The Group also tracks global insolvencies through its proprietary annual Business Failure Index, helping to steer policyholders in the right direction when it comes to shipping product either domestically or abroad.
For more information on Euler Hermes ACI and its risk mitigation products and services, visit http://www.eulerhermes.com/usa.
Euler Hermes is the worldwide leader in credit insurance and one of the leaders in bonding and guarantees. With 5,400 employees in 40 countries, Euler Hermes offers a complete range of services for the management of customer receivables and posted a consolidated turnover of 1.9 billion euros in 2004. The North American subsidiary (Euler Hermes ACI) is headquartered in Owings Mills, MD. For more information visit http://www.eulerhermes.com/usa.
Euler Hermes, a subsidiary of AGF and a member of Allianz, is listed on Euronext Paris. Standard & Poor’s rates the group and its principal credit insurance subsidiaries AA-.
Euler Hermes ACI Public Relations and Communications Specialist
Phone: (410) 753-0652
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