Bob Cronin has no regrets about leaving the media industry two years ago or his statement at the time that the ‘current model for all media is broken’.
Cronin, who spent 18 of his 56 years in the industry as editor in chief of West Australian Newspapers, says the media – not just newspapers – is still facing a vicious cycle when it comes to generating revenue in the wake of digital disruption.
“Newspapers’ revenue base got attacked by the internet but I think all traditional media now, not just newspapers, is going through a transition which I am not sure they are handling as well as they could be,” he says.
“Newspaper revenue, the rivers of gold, which were the classified ads – they’ve all gone.
“But rather than recognise that’s where they were going, the newspaper proprietors tried to fight it and defend their own patch whereas other people just started up websites that ate their lunch.”
“With the internet, you can just say I want a red Falcon 2014 and don’t want to pay more than $10,000. It will tell you all the ones there that meet your criteria. What doesn’t work, I believe, on the internet is retail or display advertising.”
He says selling retail and display advertising based on clicks – when a click is counted as not leaving the advert within three seconds – means an advertiser could have 10,000 clicks where no one read the advertisement for more than four seconds.
“I think the advertising agencies are waking up to that fact and starting to question the efficiency of ads they are putting on websites.”
According to News Media Index, total advertising spend in the news media from December 2016 to December 2017 was $2.02 billion. The Standard Media Index revealed a media agency spend drop of 22.3 per cent across newspapers and an overall drop of 20.7 per cent inclusive of a 16.9 per cent fall in digital revenues.
Free-to-air television also has problems, Cronin says.
“Because they only ever talk about their share. What they don’t talk about is that every year it’s a share of a smaller pie. Fewer people are watching free-to-air television and, therefore, what they can charge for the ad is coming down.”
►Join us on 19 April to hear from Bob Cronin as he offers some gripping insights into the media at CCI’s Lighthouse Leadership luncheon. Get your tickets here.
