Traditional Publishers to Begin Offering Digital Marketing Services
Are digital marketing services the future for traditional media publishers? In a recent speech given at the Key Executives Mega Conference, Gordon Borrell urged newspaper leaders to consider new revenue sources, including digital marketing services. The details of his presentation were summarized by Kathy Haley at NetNewsCheck and built on the Future of Legacy Media report that Borrell Associates released last month.
Borrell warns that failure to invest in new revenue streams like digital marketing services now means that several companies will see revenue drop by as much as 20% in the future. Most newspapers can count on a growing run-of-press market in the next 4 years. But this growth will be offset by drops in classifieds and pre-print. Borrell is also forecasting a steep drop in the yellow page and direct mail industries and he suggests that newspapers could capture more advertising spending from these formats if they branch out into digital marketing services.
As consumers transition their media time from traditional to digital, local legacy media share of the market will drop from 52% to 23.4%. The way Borrell sees it, local businesses spend $3,000 a year on yellow pages to get $81,000 a year in new business. They’ve continued to pay for these listings because they deliver buyers but this scenario won’t last for long as consumers grow more accustomed to looking for what they need online.
If you’re a local publisher, do you agree with Borrell’s assessment of the market? In a report released last year, Borrell analysts estimate that the average business spends $17,000 a year on digital marketing services. Have you considered offering any digital marketing services to retain customers as the industry transitions in the next few years?