The impact of trust on the performance of news and the revenues of news media companies worldwide is undeniable, according to new research by Innovation Research Group partners Dr François Nel and Dr Coral Milburn-Curtis for World Press Trends 2018 published by WAN-IFRA, the World Association of Newspapers and News Publishers.
The IRG partners were asked in February to take on the annual benchmarking study that has since 1989 analysed data collected from WAN-IFRA’s survey of more than 70 countries, in addition to data from its global partners, including Zenith, IPSOS, PwC, and Chartbeat.
“When we were asked to take over the study, the WAN-IFRA team challenged us to deliver insights beyond the usual market trends,” recalls François. “We started by asking ourselves and some leading industry figures what are the most pressing industry issues? Everyone was concerned about how two things: one, the levels of trust in the media and, two, the sustainability of the Press. That’s when we decided to look at the relationship between the Edelman Trust Index and other data we had collected about news media organisations’ performance in terms of print and digital revenues, circulations, readership and more.”
The results of the statistical analysis were unequivocal: there is a very strong link between trust and the business bottom line.
“Our analysis shows there is a significant positive relationship between trust and digital and print audience numbers, as well as income from digital and print advertising and circulation sales,“ said François, who presented the headline findings at the 70th World News Publishers Congress in Portugal in June.
“For the press, securing a trusted relationship with its audience is not only an economic imperative but also a social and democratic obligation,” said Vincent Peyrègne, CEO of WAN-IFRA. “This year’s World Press Trends analysis shows that a lack of trust can cost publishers where it hurts most – with their audiences and advertisers, therefore impacting revenues. And, perhaps more profoundly, it is potentially costing them a central and pivotal role in their communities and society at large.”
In addition to the significant statistical evidence that trust impacts revenues, World Press Trends 2018 reports on the key performance indicators from 2017. Here are some other key findings:
While trust in media may be at an all-time low, the same cannot be said about trust in journalists, and quality journalism appears to be on the rise, particularly compared to platforms.
Users are far more likely to land directly on publishers’ sites (primarily via mobile) than they are to arrive there through social media. However, dark social traffic (newsletters, etc.) also contributes to this statistic, which further muddles the waters.
Despite print’s struggles and a decline in much of the world, recent research shows that users’ time spent with print content vs. digital is a different story.
Publishers’ primary revenue streams are facing increasing pressure, while digital reader revenue continues to grow, and industry overall revenue (primary revenue streams) has shrunk by 1,8% (YoY 2016-2017), in large part due to the continued decline in print revenues which still make up about 90% of publishers’ revenues. Publishers continue to turn their focus to a more user and consumer-centric business model, as evidenced by audience revenues of $87 billion compared to $63 billion from advertising.
While print advertising continues to tumble (by double-digit percentages in many western countries) and digital advertising growth remains slow, those revenues still make up nearly 42% of publishers overall revenue. Interestingly, despite the turmoil in digital advertising, total global advertising spending continues to grow and to compete with tech giants as well as pool resources and brand prestige, publishers are increasingly forming advertising alliances across the world.
Publishers have indeed accelerated innovation in the pursuit of digital transformation, but the lingering question remains: Will the change come quickly enough? Research into this issue in collaboration with Dr Castulus Kolo of Macromedia University has found that a publisher’s ability to successfully innovate and transform, or perhaps transition to digital entirely, depends on a number of regional, national, social and political factors.
WAN-IFRA Members can download our report for free; non-members can purchase the report.