Findings from AOP and Deloitte reveal an increase in growth forecasts for the year ahead from 4.8% in Q3 2016, to 6.4% in Q4 2016
London, UK: The latest figures from the Digital Publishers Revenue Index (DPRI), a quarterly report of UK publishers from the Association for Online Publishing (AOP) and Deloitte reveals that growth forecasts increased for the 12 months from December 2016, driven by an annual rise of 28% in sponsorship revenue.
According to the research, AOP board member confidence on financial prospects improved in Q4 2016 at both company and industry levels. Publishers’ focus transitioned away from cost reduction initiatives and towards new revenue growth through non-advertising services, causing AOP board members to increase their growth forecasts for the year ahead from 4.8% in Q3 2016, to 6.4% in Q4 2016.
Display advertising remains the largest revenue category across all platforms. While display advertising revenue continues to decline year-on-year (-£13.6 million), it still accounts for around two-fifths (39%) of DPRI pool revenue. Sponsorship (20% of DPRI pool revenue) and subscriptions (14%) counteracted the decline of display advertising with a combined year-on-year increase of £23.3 million.
In the 12 months to December 2016, B2B publishers recorded positive growth of 2.5% in DPRI pool revenue, with subscriptions being the key driver of growth, while B2C publishers reported a revenue decline of 2.6% over the same 12-month period.
Richard Reeves, Managing Director, AOP, commented: “Once again we are seeing sponsorship revenue grow steadily, highlighting the shift towards a more involved dialogue between advertisers and publishers.”
Reeves continued: “There is no doubt that ad blocking continues to be a pressing issue for publishers – according to the AOP’s 2016 Content Census it significantly impacts more than half of premium publishers, and is set to remain a priority for the industry in 2017. Therefore a focus on generating increased revenue through non-ad related ventures is not a surprise. The use of data and discussions around viewability are also key considerations for the industry in the continued quest to improve overall user experience while effectively monetising content.”
Dan Ison, lead partner for media and entertainment at Deloitte, commented: “Publishers have raised their forecast for digital revenue growth by a third – further evidence of how relentlessly evolving media consumption patterns are driving publishing business strategies and being monetised at scale: AOP board members raised growth forecasts for the year ahead to 6.4% in Q4 2016, from 4.8% in Q3 2016.”
| UK Digital Publisher Revenue (based on revenues for AOP publisher members)
AOP & Deloitte DPRI report |
||
| % Change | ||
| Q4 2016 vs. Q4 2015 | MAT to December 2016 vs. MAT to December 2015 | |
| Total DPRI pool revenue | -6.3% | -1.2% |
| Display Advertising | -13% | -10% |
| Online Video | -18% | 43% |
| Sponsorship | 23% | 28% |
| Subscriptions | 16% | 29% |
| Recruitment | -10% | -12% |
| Other classified | -31% | -23% |
About the DPRI Report
The Q4 2016 DPRI report – conducted by AOP and Deloitte – is based on a survey of 20 UK digital publishers comprising 14 B2C publishers and six B2B publishers. The aim of the report is to provide an overview of revenue levels across multiple channels and platforms – as well as insight into publisher sentiment – and to benchmark these findings against previous quarters. The information contained in this press release is correct at the time of going to press.
About the Association for Online Publishing
The Association for Online Publishing (AOP) is an industry body representing digital publishing companies that create original, branded, quality content. AOP champions the interests of media owners from diverse backgrounds including newspaper and magazine publishing, TV and radio broadcasting, and pure online media. For more information, please visit www.ukaop.org.
About Deloitte
In this press release references to Deloitte are references to Deloitte LLP, which is among the country’s leading professional services firms.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see About Deloitte to learn more about our global network of member firms.
The information contained in this press release is correct at the time of going to press.
For more information, please visit www.deloitte.co.uk.
