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Publishers team up to take on Google and Facebook

As the reach of newspapers and magazines has contracted in the face of digital competition they have become less attractive prospects for advertisers.

Getting back to the good old days, when ad revenues could be relied upon to support even the most ambitious and indulgent of editorial set-ups, has become a distant dream, but traditional media platforms are not quite ready to roll over and die.

Five of the publishing world’s biggest brands have clubbed together to form an advertising alliance.

The Guardian, CNN, Reuters, The Economist and The Financial Times hope that their combined reach, pooled data and the creation of a single platform will stem the flow of ad dollars to relatively new competitors like Google and Facebook.

110 million readers with money to spend

[pullQuote position=”right”]One in four Pangaea readers is in the top income bracket and one in five works in a senior management or c-level job[/pullQuote]The Pangaea Alliance – as the group is calling itself – claims to offer access to 110 million “highly influential and affluent individuals”. By sharing information about their readers, members of the alliance will be able to offer better targeting, along with their combined brand authority.

“Pangaea’s uniqueness lies in the quality of its partners,” said Tim Gentry, the Guardian News & Media executive heading up the project. “We know that trust is the biggest driver of brand advocacy, so we have come together to scale the benefits of advertising within trusted media environments, which are geared towards delivering cutting-edge creative campaigns in technically advanced formats.”

Of all Pangaea’s bold claims, the most compelling will be access to readers with money – one in four of its 110 million-strong audience is in the top income bracket. An affluent readership has already protected high-end titles like The Financial Times and The Economist for the ravages of the industry’s wider downturn.

The alliance launches in beta next month. It remains to be seen if Pangaea will have any issues with the high school band of the same name currently ranking above it in Google’s search results.

Publishers battling it out for a smaller pie

[pullQuote position=”right”]Google and Facebook accounted for more than 10% of global ad spend last year with combined ad revenues of USD $71.5 billion[/pullQuote]Since the turn of the century, traditional publishers have seen an increasing share of their advertising revenue move online.

Google, the world’s largest search engine, earned USD $60 billion from advertising last year, up considerably from USD $0 in 1998. The biggest social media site, Facebook, claimed an additional USD $11.5 billion from advertisers, leaving an increasingly small pie for television, print and other media to fight over.

Figures from eMarketer put total global ad spend at USD $545 billion in 2014, which means Google and Facebook picked up around 13 per cent between them. And that’s before Twitter, LinkedIn and the rest of an increasingly crowded digital landscape take their piece of the action.

The rise of digital advertising and digital media in general has put the squeeze on traditional publishers. Print circulations in Australia and Oceania fell by almost 20 per cent in the five years to 2013, according to figures from the World Association of Newspapers and News Publishers.

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