Newspapers’ digital ad growth stalls

Online ad sales are slowing down as newspapers cut back on print and focus on their web offerings, according to Reuters.

In Q1, newspapers digital advertising revenue increased by just 1% YoY, which is the fifth consecutive quarter that growth has declined.

Excess ad space, the rise of electronic ad exchanges and the weak US economy are thought to be contributing to the slowdown.

Digital ad revenue at the New York Times fell 2.3% in Q1 (YoY), while the Washington Post recorded a 7% drop.

According to the Newspaper Association of America, total US newspaper ad revenues fell 6.9% from $5.5 billion in Q1 2011 to nearly $5.2 billion in Q1 2012.

Print ad revenues dropped 8.2% to $4.36 billion over the period, while online ad revenues were up 1% to $816 million (online ad revenue accounted for 15.7% of total ad revenues in Q1 2012).

Despite the figures, a chart from Mary Meeker’s latest presentation shows that print is still a big source of advertising revenue.

In the US advertisers spend a quarter of their budget with newspapers and magazines even though consumers spend less than 10% of their time with print.