MarketLineIC_Global Newspapers Market Supply Chain Analysis_170922.pdf

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1、Global Newspapers Market:Supply Chain Analysis-MLVC001-075Global Newspapers MarketSupply Chain AnalysisMLVC001-075Global Newspapers Market:Supply Chain Analysis-MLVC001-075Table of Contents2Complete Supply Chain:OverviewComplete Supply Chain:Overview(contd)Content Creation:OverviewContent Creation:A

2、nalysisContent Creation:Burning Issue Content impact on digital advertising revenuePrinting:OverviewPrinting:AnalysisPrinting:Burning Issue-DigitalizationDistribution:OverviewDistribution:AnalysisDistribution:Burning Issue-COVID-19 dampening print copy sales End Users:OverviewEnd Users:AnalysisEnd U

3、sers:Burning Issue Growth of digital advertisingAppendixGlobal Newspapers Market:Supply Chain Analysis-MLVC001-075Complete Supply Chain:Overview3The global newspapers supply chain can be split into four distinct stages:content creation,printing,distribution and end usersContent CreationAdvertsCorres

4、pondentsWire ServicesPhotographersEditorsPrintingTypesettingTypographyInkPaperPrinting PressDistributionNewsagentsSupermarketsStreet VendorsOnline SubscriptionsPostEnd UsersIndividual ConsumersAirport LoungesAdvertisersLibrariesOfficesGlobal Newspapers Market:Supply Chain Analysis-MLVC001-075Complet

5、e Supply Chain:Overview(contd)4Media conglomerates dominate the content creation and printing stages while distributors and end users tend to be completely separateContent CreationNewsCorpYomiuriAxel SpringerXinhua NewsRCS MediaGroupPrintingNewsCorpYomiuriAxel SpringerXinhua NewsRCS MediaGroupDistri

6、butionWalmartCarrefourTescoIndependent NewsagentsRoyal MailEnd UsersIndividual CustomersEmiratesQatar AirwaysLocal CouncilsOfficesGlobal Newspapers Market:Supply Chain Analysis-MLVC001-075Content Creation:Overview5The newspaper companies employ content creators to gather and write the information fo

7、r the publicationContent CreationNewspaper CompaniesReportersJournalistsEditorsPhotographersGlobal Newspapers Market:Supply Chain Analysis-MLVC001-075Content Creation:Analysis6Although journalists typically have the freedom to write about anything,editors control the final content News Corp is one o

8、f the leaders of the market and that stems from its competitive advantage of being a media conglomerategiant.News Corp is ownership-affiliated even after the spin-off of News Corporation to News Corp and 21st Century Fox to a media conglomerate group,which means that it is horizontally diversified w

9、ithin the range of substitutes(television,entertainment,book and magazines publishing)in this market.This gives a considerable competitive advantage against thethreat of substitutes.In addition,News Corp follows a more consolidated business model as its cornerstone publications(New York Post and The

10、 Wall Street Journal)have both national and international impact,refraining from a fragmentedcompetition model.Not only this,but the company also competes within different segments of the market such as politicsand business with these publications.As well as leadership in the US,News Corp is a leadi

11、ng company in the UK,owningThe Sun-the most popular tabloid in the UK market-along with highly-circulated conservative-style newspapers,The Timesand The Sunday Times.The section of national and international news,generally the first part of the paper,is compiled from correspondents whosend in their

12、stories electronically,usually via email,to their editors computer.The editor then checks the stories,sometimesrewriting them or increasing or decreasing their length.Additional stories of importance are compiled from wire services suchas United Press International,Associated Press,and Reuters.Journ

13、alists can work for multiple papers and it is not unknown for reporters to reuse and rewrite stories that have alreadybeen written elsewhere.Global Newspapers Market:Supply Chain Analysis-MLVC001-075Content Creation:Burning Issue7Content can have an impact on digital advertising revenue;COVID-19 cov

14、erage is a clear example of thisWith the decline in circulation of print newspapers,many companies have come to rely on digital advertising revenues to boost income.For example,for the first time in 2018,Mail Onlines ad revenues overtook print advertising revenue for its Daily Mail and Sunday Mail t

15、itles.For numerous titles,revenue from digital advertising has helped to offset declines in print copy sales.However,the widespread coverage of the COVID-19 pandemic as it first began to grip the world created issues.Many advertisers began using technology to block ads from appearing next to stories

16、 that mentioned the pandemic.According to newspaper publishers,words related to the pandemic such as coronavirus and Covid-19,are being blacklisted throughout the advertising industry.However,not covering the pandemic is not an option with demand for such stories soaring.An April 2020 study of artic

17、les on the BBC News website found that five out every six articles had a focus on the virus.In the UK,the publishers of the Daily Mail and Daily Mirror announced that they expected this to have a detrimental effect on revenues.Daily Mail and General Trust(DMGT)stated that it expected advertising rev

18、enue to be lower than previously expected.In its 2020 financial year,the publisher saw a 30%decline in print advertising revenue,while total advertising revenues across the Mail businesses decreased by an underlying 9%.Global Newspapers Market:Supply Chain Analysis-MLVC001-075Printing:Overview8Once

19、the content is finalized,the newspaper is sent for printing in large printing plants PrintingMaterialsPaperInkPrinting Press ComputersPress WorkersGlobal Newspapers Market:Supply Chain Analysis-MLVC001-075Printing:Analysis9The printing stage brings all of the content together in a hard copy,ready to

20、 be distributedLarge printing presses are typically located in a separate plant to the editorial and advertising offices but are officiallyowned by the newspaper companies,although some outsourcing occurs.For example,in 2017,the Guardian made thedecision to switch from its original Berliner style to

21、 become a tabloid paper.By outsourcing its printing to Trinity Mirrorthe Guardian was able to cut costs and get rid of its three so-called Berliner presses,which cost 50m($64.1m)in 2005.Newspapers are generally made up of four sections:the editorial section which includes news,politics and opinions,

22、theentertainment section which includes crosswords,horoscopes and TV guides,the health,education and culture section,and finally the sports section.Newspaper printing requires high quality and timely printing because any particular issue can only be sold to the masseson that one date.Unlike other fo

23、rms of printing,it requires lots of information to be published in various fonts,sizes,anddesigns.Additionally,it requires thousands of copies to be published at the same time,so accuracy cant be ignored.Installing modern machinery can fulfil the requirements at a faster pace.Web offset machines are

24、 suitable for highvolume printings,usually over 500 units or more.Any mistakes in the text after this process will likely not be picked upuntil the newspaper reaches the public.Global Newspapers Market:Supply Chain Analysis-MLVC001-075Printing:Burning Issue10Online newspapers skip the printing stage

25、 altogether but risk ruining the newspaper experience altogetherChecking the news on a mobile device or computer is becoming increasingly simple.News notifications popping up on smartphones are a normality next to messages from friends or email alerts.The demand for print newspapers has been declini

26、ng in almost all countries around the world.According to the Newspaper Association of America(NAA),in 2018 Weekday print circulation decreased 8%and Sunday circulation decreased 9%from the previous year.In an age where so much information is available online,newspapers are struggling.UK newspaper Th

27、e Independent moved fully online in 2016 and it is likely that many more will be forced to follow suit.Analysis of US newspaper sales by Press Gazette showed that The Wall Street Journal saw its print circulation in Q1 2020 being 16%down when compared to 2016,while USA Today and The New York Times s

28、aw a 45%and 26%decline respectively.Accessing the news online is a completely different experience to reading a newspaper in full.When online,consumers want a range of different sources and will frequently flip between websites to gather the information they need.Print newspapers are immersive and g

29、ive information on the weather or the TV schedule,for example,but online readers are more likely to go elsewhere for information not related to the news.Paywalls largely fail because information is largely interchangeable and with so many other sources on the internet,it remains to be seen why the p

30、ublic would fully embrace paying for online newspapers.News Corps The Sun is one newspaper that implemented a paywall but removed it after losing readers.Global Newspapers Market:Supply Chain Analysis-MLVC001-075Distribution:Overview11There is a wide range of distribution channels for newspapers glo

31、ballyDistributionSupermarketsWalmartTescoCarrefourNewsagentsIndependent ShopsPostal DeliveryOnline SubscriptionsGlobal Newspapers Market:Supply Chain Analysis-MLVC001-075Distribution:Analysis12Stock control is a major issue for print newspapers,something that is irrelevant for online newspapersNewsa

32、gents and supermarkets will send back the barcodes of any unsold newspapers in exchange for partial creditso it is in the best interest of the newspaper companies to avoid overstocking.Newspaper hawkers may sell newspapers on the street or public transport.Paperboys or girls also used to be a maindi

33、stributor of newspapers to houses that paid a subscription.Both of these are far less common in Western countriesbecause of safety concerns and labor laws,but street vendors are still common in other countries.Free newspapers are a substitute to traditional newspapers and make their profits from adv

34、ertising alone but it iscommon to see people rejecting free copies,demonstrating the lack of interest in these products.Media bias is important in this stage of the process as well.For example,many retailers in Merseyside,UK haveboycotted the Sun because of its allegations against Liverpool supporte

35、rs during the Hillsborough disaster of 1989.For avid newspaper readers,the likelihood of switching is unlikely because of the media bias present in this market.In 2017,US online newspaper subscriptions surged,with 16%paying a subscription for online news,up from 9%ayear earlier,according to Reuters

36、Institute for online journalism.This was the result of the so-called Trump Bump,with unpredictable events in the wake of Trumps presidency driving the growth of news audiences.This percentagewas maintained in 2018 and 2019.Digital subscriptions are fairly sparse in the UK,with only around 9%of consu

37、mers holding digital subscriptions in2019,according to Reuters.News Corps The Sun is one newspaper that implemented a paywall but removed it afterlosing readers.Global Newspapers Market:Supply Chain Analysis-MLVC001-075Distribution:Burning Issue13COVID-19 is further dampening print copy sales At the

38、 end of March 2020,it was reported by the Financial Times that UK national print newspaper sales had fallen by over one fifth since the start of the lockdown period on March 23rd.With advice being that people should only shop for essential products and with social distancing measures in place in sto

39、res and supermarkets across the UK,footfall has fallen.This situation is not exclusive to the UK,with other countries dealing with the same issues.Whats more,with the situation regarding COVID-19 changing so rapidly and new information being released on a daily basis,for those wishing to keep up-to-

40、date with news,online sources and other media such a television and radio have been the most useful source.This has resulted in thousands of independent newsagents temporarily closing,while supermarkets reduced the number of newspapers they were takin due to reduced footfall.With print newspaper rea

41、dership already declining,the demographic of those who purchase print copies tend to lie within the older age categories.According to an Ofcom report in the UK in 2018,60%of those aged 65+consume news through printed newspapers.This compares to 21%of those within the 16-24 age category.With those ag

42、ed over 70 advised to isolate at varying points throughout 2020,revenue from print sales took a huge hit.Add to this the number of people isolating due to other reasons such as presenting symptoms of the virus or being classed as high risk,print newspaper readership levels fell dramatically.While 20

43、21 is seeing the rollout of vaccines,it is unlikely that copy sales will see recovery,with the shift to digital consumption accelerated by the pandemic.Global Newspapers Market:Supply Chain Analysis-MLVC001-075End Users:Overview14End users of newspapers are consumers that pay a fee for a hard copy o

44、r an online subscription,and also advertising companies that pay for advertising spaceEnd UsersConsumersIndividual PurchasesLibrariesAirport LoungesOfficesAdverting CompaniesOmnicomPublicisWPPGlobal Newspapers Market:Supply Chain Analysis-MLVC001-075End Users:Analysis15Newspapers are found in a vari

45、ety of locations but are becoming less common as consumers move online A further popular alternative to newspapers is the delivery of news content in other formats,for example through newsprograms on the television and the most important recent threat,that of internet news which is accessible for fr

46、ee.News aggregators such as Yahoo!News or Facebook and YouTube social media,are constantly increasing their marketshare,and also extracting much of the advertising expenditure.Airport lounges,offices and libraries may also purchase newspapers in order to offer reading material to customers oremploye

47、es.According to the World Association of Newspapers and News Publishers,the Asian market was the only marketworldwide to have an increased print media circulation in the last five years.Markets such as China,India andPakistan,have achieved growth in terms of volumes,leading to the growth in circulat

48、ion volumes of the Asia-Pacificmarket as a whole.In some countries,such as India,increasing literacy rates in rural areas are enhancing the demandfor newspapers in these regions.As a result,digital news has a long way to go before becoming mainstream,asinternet penetration is still increasing in cou

49、ntries within this region.While in China online news access is limited due tostate censorship.Global Newspapers Market:Supply Chain Analysis-MLVC001-075End Users:Burning Issue16Advertisers are increasingly moving towards digital advertising,meaning that print newspapers lose out The rise of the inte

50、rnet as a digital distribution channel has resulted in sinking circulation numbers because the newspapers are losing out to digital marketing.According to MarketLine data,the global newspapers market had total revenues of$71.2bn in 2020,representing a compound annual rate of change(CARC)of-7.2%betwe