Well, for one thing, they're not going away. Sure, a weekly or monthly installment of ink on paper can feel pretty archaic when your grandmother is browsing blogs and Pops is on his iPad. It's unlikely the industry will ever see as many ad pages as it did in 2008. Nobody needs magazines like they used to and advertisers have an increasing number of ways to reach you.
All that said, there's a big difference between losing strength and going extinct, between defensiveness and demise. There will be fewer big magazines, the big ones will typically be smaller than they once were, and it will be harder for them to get the same attention they once did. But many magazines are going to stick around, in print, for many years to come.
People still like magazines, after all. Members of the Audit Bureau of Circulations have seen newsstand sales tank of late, but their paid subscriptions have been pretty steady, slipping just 2%, to a none-too-shabby 267 million, in the first half of this year from the first half of last year. And the overall number of people reading magazines -- everyone from subscribers to people reading friends' or families' copies -- increased 5.1% to 189.8 million between the spring of 2005 and the spring of 2010, according to GfK MRI research.
The industry is also excited about its brands' potential on the iPad, smartphones and other devices. The new platforms might even provide some life after death: Last week Condé Nast revived Gourmet, whose beloved print edition it shut down last year, as a free iPad app.
If most magazine circulation comes from subscriptions, do newsstand sales matter?
Cheap subscription offers are still a key pillar of the magazine business. By signing you up to pay $15 for 12 monthly issues -- a year's worth of high-quality content for roughly the price of a 3-D movie ticket in New York -- a magazine can promise your eyeballs to advertisers, where publishers get most of their money. Magazines typically get far more paid circulation from subscribers than from the newsstand.
But single-copy sales are a big preoccupation of many publishers and their advertisers, partly because they seem to give a real-time measure of a title's vitality among consumers, and partly because they're more profitable than subscriptions.
That's why it's been worrisome to watch newsstand sales decline in recent years. Single-copy sales fell 5.6% in the first half of 2010, compared with the half a year earlier; 9.1% in the second half of 2009; 12.4% in the first half of last year; 11.1% in the second half of 2008; and 6.3% in the first half of 2008, according to magazines' reports with the Audit Bureau of Circulations.
The good news there, for what it's worth, is that most of those declines probably aren't about some new disaffection with magazines, according to John Harrington, editor and publisher of The New Single Copy, an industry newsletter. He said they're more about reduced traffic to grocery stores and bookstores -- a result of recession and, in the case of the latter, also the rise of e-books.
Let's talk rate base. What are the implications of cutting your paid circulation guarantees?
It used to be embarrassing for a magazine to cut the paid circulation guarantee it gives its advertisers, otherwise known as its rate base, because it suggested that the magazine was losing popularity. Rate base is also the basis for ad rates. And the biggest advertisers are drawn to the biggest paid circulations, because they want to reach as many people as efficiently as possible.
But the magazine business has changed, reducing the embarrassment. Given the new competition for readers and advertisers, fewer magazines are pumping rate base up, up and up. And more are trimming rate base, trying to focus on their most loyal and profitable subscribers (which they then pitch to advertisers as their most-engaged readers). Cutting rate base has come to look practical, even if it's still not what publishers want. Magazines that cut rate base in recent years include TV Guide, Time, Reader's Digest, Playboy, Newsweek, Prevention, OK, Outdoor Life, Ski, Skiing, Star and Woman's Day. In early July, Meredith said it will chop rate base 16% at Ladies' Home Journal and 11% at Traditional Home as it tested higher subscription and newsstand prices for both titles, a bid to collect more revenue from readers and to rely a little less on advertising.
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