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For all their talk about customer loyalty and increasing circulation efficiency, magazine publishers are still spending heavily on direct mail to acquire new subscribers.

According to the results of Vos, Gruppo & Capell's annual survey of 100 circulation directors, 79% conducted direct mail campaigns this summer targeting new subscribers.

Of those, only 42% claimed better results than for the same period in 1995. Some 33% said results were worse and 25% said they were even with last year.

But Dan Capell, managing director of Vos Gruppo, said publishers would be better off trying to improve circulation revenues from current readers.


"I think the answer to the situation is more like what Hearst has done," Mr. Capell said. Hearst Magazines announced last summer that it would cut rate bases across all 13 of its titles to eliminate "marginal readers."

Mr. Capell said he expects an increased emphasis on publishers pursuing circulation revenues. Other circulation analysts appear to agree.

In this market, "I think readers have to pay, and we've been able to get them to do that, especially with the Meigher titles we've handled-we've seen that work," said Bob Cohen, founder and president of ProCirc. The company handles direct efforts for publishers Meigher Communications and BYOB/Freedom Communications.

According to the Vos Gruppo survey, 40% of respondents raised their titles' newsstand price during 1996. Of this portion, 64% said their unit sales were worse. In addition, of the 28% of all respondents that raised subscription pricing, none reported better renewal results, and 20% said results were worse.


Looking to 1997, only 10% of the executives surveyed plan to raise subscription prices and 10% expect to raise newsstand prices.

Mr. Capell said of the 600 magazines tracked by the Audit Bureau of Circulations during the past 10 years, "well over 100 of those titles have cut their rate bases and we'll see more of that."

"I think [Mr. Capell's] analysis is right on," said Robert Wientzen, the new chairman-CEO of the Direct Marketing Association. "It would be much more efficient for publishers to hold onto the customers they have."

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