As COVID-19 shakes up our social practices and habits, beginning with travel and tourism, it threatens to shake out the long practice of printing news on paper. It suggests that this week’s closure of AAP may not be the last job losses this year.
The industry’s not-so-quiet secret is that ads for travel and events are all that’s keeping printed papers alive. Now, according to the Standard Media Index, those figures are starting to slide, with agency bookings for travel down 5.1% in January compared to the previous year.
Travel will come back to advertising as people work through their coronavirus fears, but not to print. The big lesson from the past 20 years is that once an advertising category leaves print it only comes back in digital.
Travel in Australia is estimated to generate about 5.6% of all ads booked by agencies (about $390 million in 2019). The largest component is for travel services such as travel agents, tours and cruises — the category that fills up the print products, targeted at people over 60 who have the money and time for discretionary travel and entertainment,
Travel and event ads have stuck to print because print has stuck to boomers. In shaking up travel and travel advertising, COVID-19 will hurry along the inevitable trend to digital.
Last year, the Interactive Advertising Bureau reported that half of all Australian advertising spend is now directed to digital channels.
These print-sticky over-60s are most likely to postpone or cancel travel plans. They’re the group most under threat of serious infection from coronavirus.
They are generally risk averse. Travel that once seemed safe suddenly seems dangerous. Like group tours or ocean cruises, any enclosed space or public gathering is in danger of being perceived as an infection incubator. As this demographic stops travelling, the market stops advertising.
To understand the threat to print, pick up a copy of the weekend Sydney Morning Herlad or Age: about two-thirds of its ads are for travel. In the Weekend Australian, with far fewer ads, about 80% of ads are for travel and events
In editorial, travel pages are now the only remaining section of those big ad-supported supplement inserts that used to bulk out our newspapers, particularly from the 1980s on.
The loss of these ads is more a threat to the Nine mastheads than it is to News Corp. In its half-year results released last week, Nine reported that about half of its masthead income still comes from advertising — and almost two-thirds of that (about $64 million over six months) is in print.
It’s a fair chunk of money given the diminishing numbers reading the print product.
News Corp papers also have limited advertising categories but they’ve not been as successful in the travel market. It’s also widely believed that News Corp is keen to have the last paper standing, and will keep printing longer than Nine just to prove it can.
Like all advertising categories, travel is already shifting to digital. According to some reports, it’s happening faster than the general digital shift.
There’s Facebook: another boomer medium of choice. And there’s search, where Google has developed a special tool for flights and accommodation.
Then there’s travel sites that mix social media functions with transactions like Tripadvisor, Booking.com, Trivago or Airbnb. Major airlines including Qantas are also getting into the act.
The Australian boomer-focussed news media start-up Starts at 60 has launched a parallel full-stack travel service, Travels at 60, which uses social media and direct marketing to reach its customers.
As travel plummets — particularly discretionary travel and particularly among over 60s — expect advertisers to cut ads and speed up the pivot to lower cost (i.e. digital) options.
When the coronavirus fear is over, the travel boom will almost certainly resume its decades-long upward trend (as it did post SARS).
But as the fear shakes ads out of print and into digital, it may well leave print papers behind as one of the enduring casualties.