often relies on a newspaper purchased by Multiple Newspaper As shown in Figure III, there is a close Readership Declined There is less tendency for a household to read more than one or two newspapers each day. The decline in multiple newspaper readership is due to a number of factors including: 1. The larger size of newspapers in terms of both editorial and advertis consumers have the time and inclination to read two, three or four sizeable newspapers each day. 4. A substantial increase in newspaper prices brought about by the rising costs of labor and other publishing costs since 1946. 5. The movement of urban population to suburban areas. When families move to the suburbs, subscriptions are cancelled and daily purchasing habits are changed. In addition, suburban shopping centers, factories and office buildings usually are not supplied with as many editions of newspapers as the central city street stands and news dealers. Consequently, there is less opportunity and less incentive for purchasing more than one or two newspapers each day. 6. Other factors contributing to the decline in multiple newspaper readership are the adverse effects of strikes against newspapers and the consolidation of some metropolitan newspapers. As a result of these developments, the average circulation per household of daily newspapers has dropped from 1.33 newspapers in 1946 to 1.08 in 1964.3 In spite of . this decline, circulation expanded 9.5 million copies during this period. It appears that the decline in multiple newspaper readership is about over. Most of the decline since World War II occurred during the years 1946-1954. As the average circulation per household approaches 1.00, further declines are almost impossible because most families purchase at least one newspaper daily. Newspaper Advertising Expenditures on newspaper advertising have more than tripled since World War II. As shown in Figure IV, the percentage increase of dollars invested in newspaper advertising has exceeded the corresponding growth of the economy. Newspaper advertising reached almost $4.1 billion in 1964, more than three and one-half times that of 1946, whereas the Gross National Product in 1964 was three times as great as in 1946. Therefore, the percentage growth of newspaper advertising exceeded the corresponding growth of the economy by over 50% in the years 1946-1964. Of the $4.1 billion expended on newspaper advertising in 1964, four-fifths was for local advertising and one-fifth for national advertising. The expansion of newspaper advertising has benefited both advertisers and the consuming public. Most newspaper advertising is informative. It describes in words and pictures what products are available, from whom they are available and at what prices. This information enables consumers to shop and compare by reading newspaper ads in the comfort of their homes. A series of studies at the University of Wisconsin show that purchasers of small.. appliances, television sets and living room furniture do much of their shopping by reading and listening to advertisements, by discussing products and brands with friends and relatives and by relying on their past experience with retailers and brands. As a result of this out-of-store shopping, a tentative decision is often made to purchase the desired product at a selected Yearly changes in circulation, households, and average circulation per household are shown in Appendix IV. Bruce LeGrande and Jon G. Udell, "Consumer Behavior in the Market Place," Journal of Retailing, Volume 40, No. 3 (Fall 1964). store. A trip to the selected store results in the purchase if the consumer's expectations are realized. The studies revealing this pattern of shopping behavior have also shown that consumers relied far more heavily on newspaper advertising than on advertising in any other medium. For example, in the purchase of household furniture and television sets newspaper advertising and discussions with friends and relatives were the two most frequently used out-of-store sources of information. Fifty-six per cent of the purchasers used newspaper advertising as opposed to 21% using magazine advertising, 16% using catalogues, 14% using television advertising and 10% using radio advertising. In addition to being the most used, the newspaper was the most helpful advertising medium. With findings such as this, it is not surprising that advertisers have found it profitable to invest more money in newspaper advertising than in any other medium. In 1964, newspapers received 29% of all advertising expenditures. Newspapers' share exceeded that of the second largest medium by 50%. However, since 1949 newspapers' share of total advertising has declined from 37% to 29% due to the introduction and growth of a new advertising medium-television. All the established media have experienced a decline in their share of total advertising expenditures in order to make room for this new medium of advertising and communica a growth of 87%. Consumption in the latter years, 1962-1964, would have been considerably higher had it not been for prolonged strikes against several large metropolitan newspapers. This growth exceeded the growth of population. Newsprint consumption increased 87% from 1946 to 1964 whereas populagrew 36%. This more rapid growth of newspapers is not too surprising. The nation's standard of living has risen appreciably since World War II and newspapers have benefited from the increased prosperity. While the most significant measure of newspaper growth is newsprint consumption, the most meaningful measure of overall economic growth is the Real Gross National Product. Gross National Product in constant dollars (to remove the artificial effect of rising prices) reflects both the 1 NEWSPAPER GROWTH AS MEASURED BY CHANGES 1946-1964 58 |