If they increased their sales they acquired greater losses and moved further into debt.
This happened to the Daily Herald when it re launched as a daily in 1919. The newspaper spent £10,000 on promotion, which was an adequate amount of money to guarantee it increased its circulation. Editor of the Daily Herald George Lansbury stated, "Our success in circulation was our undoing: The more copies we sold, the more money we lost.""(Get me a murder a day, page 46).
Advertising had always played an important part in the development of the British Press. However, the popular papers of the Northcliffe era were more closely tied to advertising than the newspapers of Mid-Victorian Britain. By 1886, nearly 61 percent of the column space in the Telegraph and 49 percent of the column space in The Times were dedicated to advertising. In 1907 total advertising expenditure was an estimated twenty million pounds. This expansion was a reflection of the increasing reliance of the press on advertising as a source of revenue. As circulation rose the costs of newspaper production increased. More pages had to be filled, more reporters had to be hired and there were higher distribution costs as newspapers were circulated all over the country. This placed pressure on the cover price of newspapers and as a result of this, advertising became not only the main source of revenue but also the main way to keep prices down. By the end of the nineteenth century newspapers ceased to be sold at their true costs and the cover price of newspapers were subsidised by advertising revenue.
Northcliffe made a significant contribution to associating newspapers closely to advertising. Prior to Northcliffe, most of the advertisements in newspapers were classified. They fitted into columns and most of the front pages of newspapers were columns of classified adverts. The Mail became the first newspaper to accept display advertising.