The US newspaper industry is facing some very bad news: growth in digital ad revenue is declining. A story published by Reuters today states that, according to statistics from the Newspaper Association of America, digital ad revenues at newspapers are up just 1% from a year ago, making this the fifth quarter in a row that growth has dropped.

Reuters reports that online ad revenues at the New York Times Company experienced a 2.3% drop to $48 million in the first quarter, compared to the same period the year before. At the Washington Post Company, online ad revenue fell 7% to $24.2 million, the article says.

What’s going wrong? Reuters says that experts blame the existence of too much advertising space online, the rise in discount-rate ad spots, and a tough economic climate in the US for the slowdown.

When the New York Times Company originally announced its decline in digital ad revenue, paidContent reported on an earnings call with CFO James Follo, who “explained that digital ad sales have long been insulated from macro-economic events. Starting in 2011, however, these ad sales began to be sensitive to the European debt crisis and other events that affect print ad sales.”

Why would a company pay a newspaper for advertising, when it can broadcast directly to its audience online? The question has long been perplexing newspaper companies, who are seeing their revenues drop as a consequence of brands cutting them out of the advertising process and going straight to Twitter or Facebook to reach their customers.  

But instead of fighting the shift, the New York Times Company launched a new advertising initiative yesterday, which aims to benefit from the fact that brands are becoming their own publishers. Ricochet, as the Times’s product is called, hopes to generate revenue by allowing brands to select specific New York Times content that is relevant to their customers, and then to share links to a version of that content surrounded by their own advertising.

“In the traditional advertising model, brands reach audiences through content; by contrast, using Ricochet, content reaches audiences through brands," explains the vice president of research and development at the Times, Michael Zimbalist, quoted in the official press release.

For a long time, advertising revenue has been the life-blood of newspapers. But as media companies manage the switch from print to digital publishing, their advertising sales strategies have to evolve rapidly too.

How can you integrate print and digital sales teams? How can you still get the most out of print ads? How can you harness social media to boost your advertising? And how can you find new online revenue streams?

These were some of the questions addressed at WAN-IFRA’s 22nd World Newspaper Advertising Conference in Prague at the beginning of last month, where speakers included Will Goodhand, "Juicy Evangelist" at BrainJuicer in the UK, Peter Zollman, Founding Principal of AIM Group and Classified Intelligence and Halvard Kristiansen, Head of Behavioural Targeting for Schibsted in Sweden.

WAN-IFRA’s full summary of the conference is available now to download here.

Pearson has just published its end-of-year results, and in a tough economic climate they're impressively strong. The company, which counts the FT Group, Penguin, Pearson Education and a 50% stake in the Economist Group among its many holdings, has reported a 12% increase in its adjusted operating profit, with a 27% growth in profits for the FT Group.

Part of this success is due to the FT Group reducing its dependence on volatile advertising markets, and relying more heavily on digital, subscription and content revenues.

Overall, the FT Group is now making more money from its content, and less from advertising. In 2007, the group drew 41% of its total revenues from content, 59% from ads. Now the balance is 58% from content, 42% from ads.

What's more, according to the report, money from digital and services now account for 47% of the FT Group's revenues, compared to just 25% in 2007.