Daily Mail publisher turns to price rise to counter advertising slump
Summary
DMGT (Daily Mail and General Trust) increased cover price of Daily Mail by 5p, which they say is to help counter the steep decline in advertising revenues that they have faced recently. However, the Daily Mail have emphasized that this rise is the first in three years. The publisher said that sales for the last four weeks in both print and digital were down by 12% compared to last year and something had to be done about this decline and fast. This decline that the Daily Mail has suffered represents overall worsening in trade and analysts have indicated very tough conditions ahead for the newspaper industry.
Key Statistics
- The newspaper has been sold at 65p since 1st Feb 2016
- In first quarter to end of December underlying sales for the unit were down 2% to £188m
- 12% drop in print advertising
- Print advertising decline was offset by 32% growth in digital revenues
- Company's flagship website reported a 27% growth in advertising sales, which includes a 66%rise from a low base in the USA which they have invested heavily in
My Opinion
I personally think that the Daily Mail are not taking into account the way that the newspaper industry is changing with the developments in NDM. They are trying to claw back what little remains of the print industry for their publication by increasing the cover price but I think doing this is a lost cause. Eventually, they will have spent more money trying to keep their print publication above water than they are getting back in revenues and then be a ditch which they can not easily dig themselves out of in terms of the company revenue figures. At the moment, their print advertising revenue declines have been offset by the digital growth but what about when they do not have enough of a digital growth to carry on offsetting the losses of the print publication. I believe that the Daily Mail group should be investing all there power into building/strengthening their presence in the digital market to stay afloat rather than the print industry. We all already get our news online which means that we do not provide the Daily Mail with the revenues they need in the print sector of their business but also with a price hike even fewer people are going to buy it when many people are said to be having financial woes.Digital is growing and print is most definitely not coming back.
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