The publishing industry has undergone significant changes in the wake of the pandemic. According to the Tactician Media CoreBI publisher transaction database, overall advertising revenues have declined by 10.4% in the past four quarters (Q2 2022 - Q1 2023) compared to the previous four quarters (Q2 2021 - Q1 2022). This drop can be attributed to general merchandise and pharmacy retailers reducing their advertising expenditures, supply chain uncertainties and the closures of big box retailers.
The decline in advertising revenues affected various vertical categories such as Department Stores, Furniture, and Drug and Liquor. However, the Finance and Banking vertical experienced a growth of over 15% in revenues during the same period. Additionally, vertical categories like Entertainment/Travel, Local Services and Home Improvement show a documented increase in revenue percentages year over year.
The Finance and Banking sector's largest revenue gains (+25.9%) came from ROP (Run of Press) advertising, which accounted for over 63% of the category's total revenues. Inserts contributed around 21%, and Digital Owned and Operated channels accounted for approximately 16%.
Notable advertisers in the Finance and Banking category include Bank of America, Geico, Edward Jones, State Farm Insurance, PNC Bank, TD Ameritrade, Wells Fargo and others. While publishers have experienced significant growth with nationally recognized brands, the most substantial growth has come from local and regional financial businesses.
Market drivers
Several factors have contributed to this growth. In the banking sector, the increase in the Federal Reserve rate has led to higher savings rates amongst older households, which were previously suppressed. With long-term CD rates hovering above 5%, there has been a notable shift from volatile equities to safe haven assets. For publishers, this presents an opportunity to feature regular weekly ROP ads highlighting the latest investment vehicle rates.
Publishers have observed increased advertising from local financial businesses such as investment advisers like Edward Jones, Wells Fargo Advisors, TD Ameritrade, Charles Schwab and others.
While more familiar names in banking are returning to publishers, the primary growth advertisers are local and regional banks. Regional banks like PNC Bank, Bank OZK, Union Savings Bank, M&T Bank, Truist and many others have experienced significant spending gains in both ROP and Digital advertising. Additionally, credit unions have also shown substantial growth in advertising spending over the past four quarters. The recent bank insolvencies have also led to increased competition for depositors. Local banks are fending off withdrawals and thus need to increase consumer outreach.
These depositors and potential investors form the core subscriber base for publishers. Among the tens of millions of subscribers from the Tactician Media MarketAI platform, both in print and digital formats, subscribers tend to be older, with higher incomes and net worth compared to non-subscribers. When publishers combine their print and digital audiences based on the ZIP codes near regional bank branches or financial advisers' offices, the audience penetration rates are often higher than other media. It is common for publishers to reach audience penetrations of over 50-70% of print and digital consumers in proximity to a bank location or financial adviser.
However, not all publishers are taking full advantage of the current market conditions. Those publishers relying on orders from agencies or national buying firms are missing many opportunities from local and regional players. If the publisher is not actively seeking advertisers in the financial services category those advertising dollars will go elsewhere.
Meeting the challenge
To achieve success, it is crucial for publishers to build a strong Print Plus Digital strategy. While having a significant digital presence nationwide, only 31% of a publisher's digital audience comes from their primary and secondary markets. For electronic editions, this percentage is slightly higher at over 34%, but still falls short of a majority.
By utilizing Tactician Media's DigitalZip system, publishers can identify their digital audience and analyze impression history at the postal ZIP code level. This data is then combined with print distribution across all publications in each market. Many advertisers may be unaware of the diverse range of websites and community publications offered by a publisher. Demonstrating a combined Print Plus Digital penetration is crucial to display viability to finance and banking providers.
While the geographic scope may be narrower for financial advisers, banking advertisers respond positively to county-level penetrations that include their own locations as well as those of their competitors. Showing a dominant Print Plus Digital presence in the local county(s) where a bank or credit union aims to gain market share is vital for gaining acceptance and generating advertising revenue. In the case of insurance providers, demonstrating penetration across a state for multi-market publishers has resulted in enterprise-wide revenues.
Prospecting plays a significant role for publishers experiencing growth or those facing a decline in spending. Leveraging thousands of prospects from location, industry and revenue databases like Tactician Media's Local Recon program can help identify real opportunities. Many lucrative advertising prospects can be found locally. By combining location data with masthead-level revenues, publishers can assess both new client opportunities and expand advertising schedules and frequencies across multiple publications.
Conclusion
Despite historical unease in the finance and banking industry, there is currently a massive opportunity for publishers to increase advertising revenues. These revenues, primarily from ROP and digital channels, come with higher margins as publishers are uniquely positioned to serve a highly competitive market. The convergence of banking and financial services competition with the age and value of news consumers positions publishers favorably.
By evaluating all aspects of advertiser revenue in comparison to national trends, publishers can strategically advance near-term revenue through ROP while establishing key relationships to expand into Digital Owned and Operated website ads and digital services. This requires time and effective business intelligence practices to gain a comprehensive view of opportunities.
Demonstrating the viability of the print plus digital audience in and around financial institutions is crucial. Prospecting for new advertisers is even more important. Every publisher could generate millions in revenues not only from finance and banking clients but also from other vertical categories. The trends indicate that new advertising revenues are primarily emerging from local and regional opportunities. Aligning subscriber bases in both print and digital formats with the goals of advertisers is a winning strategy.
Background
CoreBI, a transactional database, holds a vast amount of advertising revenue totaling over $15 billion from publishers across the United States. This comprehensive database meticulously tracks more than 9,000 advertisers, offering comparative rate and spending data to client publishers. Local Recon, on the other hand, is a prospecting tool that leverages data from CoreBI in conjunction with information on over four million retail, finance, healthcare and educational locations. By combining transactional data with geographic coverage and specific locations, Local Recon provides valuable insights into prospective trends and identifies actionable advertiser targets.
DigitalZip, another tool, monitors over 1,000 publisher websites and electronic editions worldwide, focusing on ZIP code-level data within the United States. It utilizes data provided by Google Analytics API, covering both Google Analytics 360 and GA4. This robust tracking system enables publishers to gain comprehensive visibility into their digital presence and performance across various platforms and geographic regions.
Michael Lombardo is CEO of Tactician Media LLC and can be reached at mlombardo@tacticianmedia.com.
