Auto industry advertising slump hurting old media
Mainstream media has been quick to pile on Detroit automakers, which, along with some questionable Motown metal, has helped drive nationwide perception of the Big Three into the ground. Now that times are tough at traditional media outlets, well, that's Detroit's fault, too. Back in 2004, about $24 billion was doled out to television, print, and radio ads. Fast forward to 2008, and painfully slow sales coupled with cash-strapped automakers and dealerships have cut that number to about $15 billion. That's putting an Excursion-sized dent in the earnings of stalwart media companies like Viacom and Time Warner (Autoblog and Weblogs, Inc. are owned by Time Warner), as the media giants point directly towards Detroit and a soft auto market to explain their drop in revenue. While times are tough on TV, print advertising is taking the brunt of the blow. Newspapers took a $131 million hit in the first quarter of 2008 as dealers have pulled back on full and half-page ads due to slow sales and limited cash flow. The proliferation of mainstream Internet advertising is also cutting into old media's profits, as automakers feel they're getting more bang for the buck with less expensive online ads. With the car market looking worse by the day and the unabated growth of Internet advertising, we don't expect this trend to reverse itself any time soon.
[Source: New York Times]
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Reader Comments (Page 1 of 1)
mr.ed 12:13AM (8/13/2008)
Print has been in decline for years. This is another nail in a very splintered coffin.
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TJ 9:39AM (8/12/2008)
close, but not quite right.
Circulation has dropped like a stone. As circulation decreases, so does advertising revenues (as rates are based on circulation...)
There are many reasons that circulation has dropped, from internet to increased 24 hour cable news choices to what some or many (debatable) perceive as agenda based content versus objective reporting.
Any way you cut it, the papers aren't hurting because of decreased ad revenue, but rather, ad revenue is hurting because of decreased circulation.
(this same phenomena is affecting stock prices. See: Gray Lady, 10 year trending)
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Adam Marcello 11:01AM (8/12/2008)
Well I think the point is that the media outlets are saying its detroit spending less on them thats the cause of their lost revenue. Autoblog is merely pointing out the lae ass agrument.
The newspaper is a horrible way to distribute news in todays day and age. Its much too slow compared to the internet.
Randy 1:35PM (8/12/2008)
It's both circulation and a drop in advertising by Ford, GM and Chrysler.
I'm pretty happy about it too! Not happy that the the Big 3 are climbing out of a world of hurt, but happy that the media outlets (a to z) are suffering. I hope they lose their homes!
Why you ask? Well reporting is one thing. Being a bandwagon riding, obsessed and misleading journalist is another thing. I've personally seen small things inflated into massive stories when it's the big 3 on the receiving end and when it's the almighty Toyo or the like, they say "Toyota said it's nothing to be concerned about and not to worry" or something like that! I actually read that one here somewhere!
Basically in the past 5 years I've learned who's who, who's smart, who's payed off, who's completely full of sh.. and who to actually consider a valuable source of information, stopped reading MT, RT, CD and AW. And to be completely honest, AutoBlog is the most truthful, unbiased news source I've found on the web. With that said, there is a riddling of bias, one sided, skewed and distorted misinformation here. It's simply more visible. One might say that technically that means that the writers at AutoBlog are less skilled in the art of cranking your motor. GOOD :)
Finally, for every reporter that sensationalized ANY companies right or wrong doing, may you lose your home, job, car, 401k, health benefits and more. Just like you collectively caused tens of thousand of American Auto Workers!
Reap what you sow!
jason 9:45AM (8/12/2008)
I am glad to hear the media is suffering. The media spins everything and makes it worse than it really is and actually has a more damaging effect.
Jason
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obie 10:19AM (8/12/2008)
Hmmm... kind of like this article?
TJ 10:34AM (8/12/2008)
NYtimes stock is at a 12 year low. The stock has plunged about 40% since April 25.
"The value of 11 newspaper companies traded on the public market since 2005 dove a combined $23.7 billion in the first half of this year, falling almost as much in six months as they had in the three prior years put together."
It has nothing to do with this article. The rags are failing.
obie 10:35AM (8/12/2008)
And smart comments aside, I should probably add that I love Autoblog and visit multiple times each day... I know that it's a tough time for lots of companies, and I would hate to see you guys even slow down!!!
TJ 10:52AM (8/12/2008)
NYtimes stock is at a 12 year low. The stock has plunged about 40% since April 25.
"The value of 11 newspaper companies traded on the public market since 2005 dove a combined $23.7 billion in the first half of this year, falling almost as much in six months as they had in the three prior years put together."
It has nothing to do with this article. The rags are failing.
Greg 9:49AM (8/12/2008)
If mainstream media takes it in the shorts because they love to bite the hands that feed them, then so it.
More idiots out of work is a good thing.
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Avinash machado 9:50AM (8/12/2008)
Actually I guess many of the car reviews in many of the print newspapers themselves are advertisements rather than actual reviews. Also known as advertorial. ADVERtisement + EdiTORIAL = Advertorial
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Ted 10:28AM (8/12/2008)
Wow - Detroit is FINALLY reacting to market conditions and doing something about it.
Could this be a sign that small, well-equipped, fun to drive, fuel efficient cars are in the future for Detroit as well?
One can only hope.
-ted
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Randy 1:36PM (8/12/2008)
Just joining us Ted?
Mikeeeeeeee 10:51AM (8/12/2008)
Ha! It sounds like the current mentality of a lot of Americans.
It is "someone else fault".
Problem is the NYT and the main stream media can't sue anyone over this.
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snakecharmer 12:28PM (8/12/2008)
This seems about right, Detroit should have cut them off from the spicket years ago for the most biased and sometimes even lies that they would print about them. Good riddance pinko comme rags...
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snakecharmer 12:35PM (8/12/2008)
good riddance pinko comme rags..
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Torrent 1:11PM (8/12/2008)
MINI tried an ad like that in Car and Driver. It sucked.
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tim 1:26PM (8/12/2008)
I guess it should be no surprise that "Old media's" biggest contributers were the American auto indistry. Since it has been proven, long ago, that those advertising methods don't work anymore this should be chalked up as one more thing these guys have been doing wrong in a big way. These companies don't make me feel "proud to be an American". Thats the main reason they are doing so poorly. They make their customers feel bad about themselves.
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KT 3:20PM (8/12/2008)
What this also shows is how many companies and people's jobs are effected by the auto industry.
All the nimrods who post that they can't wait to see the Big 3 fail don't have a clue to the magnitude that would have on the US economy. Look what's happening to it already and it's due to a slowdown in the auto industry.
The auto industry didn't create this economic "slowdown" but they are taking the brunt of it. If they fail, the US fails to be a self reliant nation.
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