More and more advertisers are reducing their marketing as a result of the corona pandemic and already several Swedish media groups are seeing the effects in the form of large ad losses.
- Some industries cancel everything, such as conferences and travel. Of course, this will continue when people stop shopping and go to a restaurant. Although it is not a total disaster yet, the next two months will be super tough, says Mikael Nestius, Business Manager at Mittmedia, which includes Gefle Dagblad, VLT and Östersunds-Posten, among others.May need to make cuts
The advertising race mainly strikes against local journalism, which for many years has struggled with a strained economy. The challenge is primarily to reduce advertising revenue. According to the Institute for Media Studies, the ad spend corresponds to the total media support of 622 million - every year.
Although the situation is so far under control, the corona crisis puts further pressure on the media houses.
- We can manage for a few months, but if it persists we need to take measures in the form of cuts. There is a risk that we may even have to lay off journalists and thus in effect pull down on local journalism when it is needed most. It would be very serious, ”says Mikael Nestius.
Lina Hedenström, CEO of NTM, which includes Gotland's Allehanda, Uppsala new newspaper and Norran, is also concerned."This is a significant amount"
- Car dealers postpone planned campaigns, buying a car is a big decision that not many people make now. Grocery stores are pulling down on marketing because they already have a great deal of pressure on customers now, and these are just a few examples. It is a significant amount, says Lina Hedenström.
How should you prioritize for any cuts?
- As far as possible, we do not want to cut down on the editorial boards, even though it is a big cost. However, our peripheral operations may include strikes, event companies, trade shows and travel agency activities. All to be able to cheer our reporters. Our core business is local journalism and it will be the focus.traffic Records
Corona pandemic is also reminded within the Stampen media group, and according to CEO Johan Hansson, local media has an important role to play in times of crisis, which is reflected in increased willingness to pay.
- Traffic is breaking records almost every day and we are getting new subscribers, but that does not compensate for the big losses on the ad page which has accelerated over the past week. We have good liquidity and strong owners in the back, so we are well equipped to handle this, but we have the worst ahead of us, ”says Johan Hansson.