Walsh made his prediction on the premise that online vertical b-to-b Web sites would disintermediate the legacy print business of trade magazine publishers. The theory was that "terrestrial" magazine publishers were too dependent on their print properties for cash flow and did not understand the new culture of the online world to make a successful transition from print to the Web.
The irony is that after the collapse of the Internet bubble, it was Mark Walsh and VerticalNet that were out of the b-to-b media industry.
Nevertheless, some pundits have wondered if Walsh's prediction of the death of trade magazines was in fact prescient.
American Business Media's own BIN reports of the last few years support this theory. Trade magazine ad pages were down by an unprecedented 20% in 2001, followed by a 12% decline in 2002. The much-predicted recovery did not materialize in 2003, with advertising pages declining another 3%.
In 2004, ad pages are flat and advertising spending was up an anemic 2% through July, according to the BIN report. ABM is projecting that trade magazine ad spending will increase by 2% to 4% in 2004. While this growth would be welcome relief for most trade magazine publishers, it is a long way from the much overdue and long-awaited strong recovery in advertising spending.
So, are trade magazines dead? Are trade magazine publishers dinosaurs?
The b-to-b media industry is undergoing some fundamental changes. These changes are having a meaningful long-term effect on some print magazines, including consolidation of advertisers and increasing media options for customers.
The core competency of the b-to-b media industry is not printing magazines. It is bringing buyers (readers/users/attendees) and sellers (advertisers/sponsors/exhibitors) together in vertical industry communities through value-added and proprietary content (editorial).
Some publishers still think they are in the printing business and don't understand how to leverage their brands and assets into the new world of b-to-b media. These publishers are dinosaurs.
Some publishers recognize that they are really brand managers who use their flagship print property to lead them into offering their customers integrated marketing solutions. The print brand is the bellwether around which they build their business. These publishers have a bright future.
In a world of search engines and 24/7 Web information, b-to-b media brands help their vertical communities differentiate quality from quantity. Editors bring context and filtering to a world in which a keyword search will produce thousands of results.
Trade magazine brands-along with their content, editorial teams, databases and the sales and marketing relationships of their teams-are the essential components of providing integrated marketing solutions to customers, including e-media properties, custom marketing programs, databases (rich media), in-person conferences and trade shows, and, yes, trade magazine print advertising.
The health of the b-to-b media industry is measured to a large degree by print advertising pages. The fact is that the recovery of the b-to-b marketing industry is well under way. Marketing budgets are increasing in most sectors, and several media channels, including e-media and custom marketing programs, are experiencing double-digit increases.
Unfortunately, it is difficult to measure and track the revenue and volume increases in these media channels. Print advertising will share in the recovery as brand building and new product introductions gain momentum in the marketing strategies of advertisers.
The future of trade magazine brands and the value proposition they offer their customers is stronger and more needed than ever before. And the reports of the trade magazine industry's demise have been greatly exaggerated.
Thomas L. Kemp is managing director, Veronis Suhler Stevenson, New York. He can be reached at [email protected]