On average, newspapers lose $7 in print revenue for every new dollar in digital revenue they earn.

That’s one of the big takeaways in a study out Monday from the Project for Excellence in Journalism that has journalists and media junkies talking.

“In general, the shift to replace losses in print ad revenue with new digital revenue is taking longer and proving more difficult than executives want, and at the current rate most newspapers continue to contract with alarming speed,” the study said.

Executives interviewed for the study predicted “newsrooms will continue to shrink, more papers will close, and many surviving papers will deliver a print edition only a few days a week.”

Although it sounds all doom and gloom for newspapers, the study also highlighted some bright spots. The papers that bucked the downward trend are developing new sources of revenue.

“One of the papers generating the most digital revenue, for instance, was having significant success selling targeted digital advertising customized based on customer online behavior,” the study said. “This is projected to be the biggest growth area in local digital advertising.”

However, researchers also noted that most of the papers in the study had very little “smart” advertising.

The study suggested that management and culture at newspapers more greatly affects their future than the sweeping trends in publishing.

To conduct the study, researchers persuaded six companies that own 121 newspapers to let them look at financial information and interview executives at 38 newspapers of varying size.

For the newspapers in the study, digital marketing has been the most common “nontraditional revenue experiment.” The concept is this: “Newspaper companies act as online marketers and consultants for local businesses—helping them with everything from search engine optimization to building websites to utilizing social media platforms.”

For instance, one newspaper (they all remained anonymous in the report) told researchers: “We have been positioning ourselves as marketing consultants and approach advertisers from needs and solutions perspective, including social media.”

The digital agency approach is the most successful of the nontraditional routes, according to the study. Problem is, it’s still pulling in modest dollars for most of the papers taking on the strategy.

“Of those papers that had developed nontraditional sources [which includes digital agencies and so-called retail malls], almost two-thirds reported earning less than $10,000 in the most recent quarter,” the study noted. “And the median income generated was about $6,500.”

So it seems marketing consultants needn’t worry about newspapers’ invading their territory—yet.

To read the full study, click here.

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