Newspaper Online Ad Growth Slows

NEW YORK Newspaper online advertising revenue growth is starting to slow, according to the most recent data from the Newspaper Association of America.

In Q1, advertising spending for newspaper Web sites increased roughly 22.5 percent to $750 million compared to the same period last year. In the first quarter of 2006, newspaper online ad revenue advanced 35 percent to $613 million.

However, online advertising revenue makes up more of total ad revenue in Q1 versus the same period a year ago. In Q1 of this year, online advertising expenditures represent 7 percent of total ad revenue versus 5.5 percent for Q1 2006.

Newspaper print advertising revenue fell sharply in Q1, down 6.5 percent to $9.8 billion. The growth realized with online advertising revenue did not push up total ad spending. Combined, print and online advertising revenue declined nearly 5 percent to $10.5 billion in Q1.

The print classified category weighed down results. Classified advertising revenue dropped 13 percent to $3.5 billion. Within the category, real estate decreased 14 percent, help-wanted declined 14.5 percent, and automotive plummeted 20 percent.

In a statement, John Sturm, president and CEO of the NAA, said: “While the classified category demonstrates the impact of how consumers and advertisers use the various media options available today, newspapers continue to make aggressive moves to redefine classified advertising revenue through new online partnerships and other approaches that will position them for the future.”

Print retail advertising revenue for the quarter was down 2.2 percent to $4.8 billion. Print national advertising revenue fell 2.8 percent to $1.7 billion.