The incredible shrinking newspaper audience

Once the definitive mass medium, newspapers – in both their print and digital incarnations – have shrunk to being niche players in the typical market, according to a number of must-read research reports released in the last few weeks.

With approximately a third of adults in the average community saying they use either a print or digital edition of their local paper to stay informed, newspapers today remain “super niches,” a term I heard for the first time a few years ago from Ron Mulder, who now works at Scarborough Research.  But a distinct lack of interest in newspapers among those under the age of 50 suggests it is only a matter of time before the niche turns from “super”  to “sliver.”

As detailed in a moment, a steadily accumulating body of research shows that consumers are using computers, mobile devices and even Facebook to shop actively for news and information. While the research shows that newspapers have slightly more market clout in small and isolated communities than in cities and suburbs, the trends all point in the same direction. Although publishers in small and medium markets have slightly more time to adapt to the digital revolution than their metro colleagues, the challenges causing the New Orleans Times-Picayune to abandon seven-day print publication will affect all but a few outlier markets in the fullness of time.

Here’s what we know from the wealth of research that has come our way:

∷ The number of people who used a print newspaper in the last week to get local news ranged from 36% in metro areas to 42% in small cities, according to a study released in late September by the Pew Research Center.  The survey found that newspaper website consumption was weaker than print, with use running from 31% in metro areas to 20% in smaller markets.  By contrast, the reliance on local television broadcasts was 65% in metro areas and 72% in small cities and rural markets. The use of TV websites ranged from 27% in big cities to 21% in small ones. 

∷ In a second study released this month, Pew found that 44% of Americans own smart phones and 22% own tablets, the latter of which, incidentally, represents a doubling of tablet penetration in just one year. After accounting for people who had both types of devices, Pew reported that fully half of the population has some sort of mobile device – and that two-thirds of this group uses their wireless devices to surf for news.  Pew reported that news consumption was the second most popular mobile activity after email. 

∷ In its September study, Pew found that, notwithstanding some variances based on market size, roughly two-thirds of consumers go to three or more sources for local news each week.  “Urban and suburban residents also use a wider variety of local news sources on a regular basis,” said Pew. “Close to half of urban (45%) and suburban (51%) residents use a combination of traditional, online and mobile local news media to get their local news, compared with 38% of those living in small cities and 27% of rural residents.” So, audience fragmentation is well under way.  

∷ The sharp generational divide in newspaper readership is illustrated in a national study  released earlier this month by a research unit at the New York Times.  While 53% of the Boomer generation (those 55 and older) said they read print newspapers, only 22% of Millenials (ages 18-34) and 32% of Generation Xers (ages 35-54) used the medium.  As illustrated below (click to enlarge), online news consumption is reasonably consistent across all ages, but smart phone use is far higher in the younger cohorts than among Boomers.

:: Another dimension of the generational divide is illustrated in a study produced in April by Burst Media, an ad-targeting service.  The company found that Facebook ranked second only to news sites as the place where sub-Boomers consumed political news.  While 44% of Millenials used news sites for political information, 22% of the cohort used Facebook and 17% used YouTube to learn about politics.  At the other end of the spectrum, 53% of Boomers relied on news sites and only 8% used Facebook and 7% used YouTube.  The usage pattern for GenXers was 49% for news sites, 12% for Facebook and 6% for YouTube.      

Assuming young’uns don’t suddenly ditch their Droids in favor of print, publishers hoping to maintain the value of their franchises must invest aggressively in broadening their audiences and revenue opportunities beyond the narrow confines of their existing, monolithic, and increasingly fragile businesses.

While this admittedly is easier said than done, the alternative to a profound commitment to strategic audience development is to let readership and revenue shrivel to the point that the costs outweigh the benefits of being in the local news and advertising business. 

Based on the 6.6% drop in newspaper advertising revenues in the first half of this year, industry-wide sales likely will be no better than $22.5 billion in 2012 – or less than half of the industry’s peak production of $49.4 billion in 2005.  While Borrell Associates (which, like most of us, is not always perfectly prescient) bravely has predicted 0.5% growth in newspaper advertising next year and further gains in the low single digits in the out-years, publishers should not be beguiled by any bounce occasioned by an improving economy.   

Unless newspaper companies find ways to connect to younger audiences, there is a clear and present danger that they will be marginalized to the point of irrelevance.