Declining consumer demand for industry products caused advertising revenue to fall
Los Angeles, CA (PRWEB) October 10, 2013
Falling demand from consumers and advertisers has damaged the Magazine and Periodical Publishing in Canada industry. Consequently, revenue has declined at an average annual rate of 3.1% in the five years to 2013. This is because consumers have increasingly opted for digital products rather than printed magazines and periodicals. Digital products have increased in popularity as mounting internet speeds, and the widespread adoption of smart phone and table devices, has amplified the accessibility and convenience of retrieving online content. The number of fixed broadband connections has increased 3.8% annually, while the amount of mobile telephone subscriptions has grown 6.2% in the five years to 2013. Industry operators have only slowly recaptured some lost revenue with digital offerings of magazines and periodicals. Moreover, declining consumer demand for periodicals and magazines has caused revenue from advertising to decline as well, given that the value of advertisements is dependent on the audience reached. According to IBISWorld Industry Analyst Jesse Chiang, “Advertising revenue accounts for nearly 60.0% of industry revenue, therefore declines in advertising revenue have hurt the industry significantly.” In 2013, revenue is expected to continue decreasing at 2.4% to $2.2 billion.
Deteriorating demand, coupled with changing industry assistance has forced many operators to close or reduce total operations. Changes in government subsidies has harmed small firms, in particular, as new requirements mandate that magazines or periodicals have 5,000 annual paid circulation to qualify for subsidies. This has drastically increased costs for operators, especially those that could not meet the new requirements, as the loss of government subsidies forced some operators to absorb a larger portion of costs. The number of enterprises in the industry has declined 4.8% annually, while the number of establishments has declined 4.1% annually in the five years to 2013.
Nonetheless, in the five years to 2018, industry revenue is expected to rebound somewhat, driven by rising consumer disposable income and increased digital diversification. “Consumer disposable income is expected to grow with a recovering economy, driving spending on discretionary items such as magazines and periodicals,” says Chiang. Furthermore, operators are expected to continue expanding digital offerings, capturing more consumer revenue and revenue from digital advertising.
For more information, visit IBISWorld’s Magazine & Periodical Publishing in Canada industry report page.
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IBISWorld industry Report Key Topics
The Magazine & Periodical Publishing in Canada industry produces and distributes magazines and periodicals in print and online. This industry does not include firms that exclusively sell online magazines or periodicals.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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