Magazines Fail to Make Top Grade in Report Card
NEW YORK (AdAge.com) -- The magazine business has done itself a lot of good since its last annual meeting, but there is no time to brag. Magazines aren't getting better because they possess effortless winning ways, after all. Instead they are finding new ways to win through their unavoidable-and unfinished-struggles.
"Everyone is going through a lot of change," said Nina Link, president-CEO, Magazine Publishers of America. "It's kind of messy. It's very exciting. There's not a lot of rules. People are going to make mistakes. But in the past year, magazine publishers have been in the game and been in the game pretty deeply."
Christie Hefner, the 2006 conference chair and chairman-CEO of Playboy Enterprises, called the chaotic past 12 months both important and good. "The challenges the industry faces have sharpened people's focus on the need to rethink how it is that we bring the power of magazine brands and magazine content to the market," she said.
A year ago, Advertising Age laid out five ways the industry could retool itself, including reconsidering rate base, working faster for advertisers and breaking further out of paper. PricewaterhouseCoopers projects that U.S. magazines will collect $37 billion in revenue this year; as this year's American Magazine Conference opens in Phoenix, Ad Age has assembled a report card evaluating the progress that's been made-or not-toward driving that figure higher.
Rethinking Rate Base: C+
In his first speech as MPA chairman, Jack Kliger told last year's conference that rate base -- a system with no parallel in other media -- should end. "Paid-circulation rate-base guarantees are a legacy of an era that predates modern audience-measurement metrics," he said then. "Circulation-based metrics are irrelevant in calculating advertising return on investment."
There's been plenty of thinking since, just not much change. Though BusinessWeek, Woman's Day and Playboy decided to trim their rate bases in a bid for quality circulation, no one ditched the system itself.
Now Mr. Kliger, president-CEO of Hachette Filipacchi Media U.S., is stepping up himself: Car and Driver and Road & Track will stop publishing average rate bases next year, he said, and will move to pricing based on issue-specific circulation.
Some say rate base should stay until magazine measurement improves. "I see no logic in removing rate base unless there are refinements to the current syndicated research on readership," said George Janson, managing partner-director of print at Mediaedge:cia. "It's a smokescreen for publishing companies to avoid making hard and fast decisions on circulation quantity vs. circulation quality."
And, indeed, the rate-base economy and any alternatives all depend on the state of magazine metrics, whatever that may be. Which brings us to ...
Working Faster for Advertisiers, Part I
Reporting Early and Often: B+
The audit bureau of Circulations has introduced Rapid Reports, letting publishers provide issue-by-issue data in something approaching real time-instead of just making the old-school, biannual reports.
"We're very excited about it and believe that it will in the long run serve the needs of both advertisers and publishers by providing them a vehicle by which to get issue-by-issue circulation on a very timely basis," said Michael J. Lavery, the Audit Bureau president-managing director. "The adoption has been somewhat slow, but there's very strong interest in it-certainly by the media-buying community."
Participants so far include Meredith Corp., American Media, Rodale, Martha Stewart Living Omnimedia, Hearst Magazines and Mansueto Ventures. Car and Driver and Road & Track will join next to support their shift from pricing against six-month averages.
The holdouts, however, include Time Inc., Conde Nast Publications, Bauer Publishing USA, Dennis Publishing, the Reader's Digest Association, Wenner Media and others.
Elsewhere, Mediamark Research is building a syndicated service due early next year to track weekly audience growth for individual issues.
But delays have hit Readership.com, the McPheters & Co. bid to provide speedy details on any issue's audience size, composition and engagement by this fall. Working through last spring's beta test took longer than planned; the service is also seeking new money.
"Readership.com is out beating the bushes," said Rebecca McPheters, president, McPheters & Co. "We're looking for publisher support via their subscriptions as well as outside equity." The launch has been pushed to 2007.
And BPA Worldwide, the chief rival to the Audit Bureau, has put its plan for monthly reporting "on hold" after agency executives said they didn't have enough resources to evaluate such frequent numbers, according to Glenn J. Hansen, president-CEO. "We remain committed to providing service to the marketplace that is of value," he said. "We continue to search for the next advantageous solution."
Working Faster for Advertisers, Part 2
Shrinking Lead Times: Incomplete
Ad pages sold slowly early this year partly because advertisers were so sluggish releasing budgets and making commitments. The first indications suggest that a repeat is approaching.
So why do publishers keep accepting extended lead times at their titles, limiting advertisers' ability to make last-minute buys? The MPA convened an "immediacy committee" three years ago, but electronic media still beat magazines up and down for flexibility.
"Long lead times for printing are still a deterrent for some clients," Mr. Janson said, "especially as budgets get released later and later and clients want immediate results to justify their advertising or marketing spending."
Being Brands, Not Books: A
"There have always been companies that were early adopters," Ms. Link said. "But this year there's just been a leap across the board."
There is no doubt about it. Publishers have stepped up multiplatform and liquid-content efforts at titles such as Lucky, which enabled shopping via text messaging; Seventeen, with its MySpace page; Sports Illustrated, whose website vacuums up more readers and ad bucks daily; Maxim, which plans a 2,300-room Maxim Hotel and Casino in Las Vegas; Vogue, with its Fashion on Demand video podcasts; Motor Trend, which moved into satellite radio; and on and on and on.
Beyond the bottom-line calculations, imagination is the limit; the progressive-culture quarterly Frank151 is opening a full-service barbershop in New York that will also house its editorial offices.
As magazine publishers become brand publishers, too, it is increasingly clear that magazines aren't always necessary at all. Witness ElleGirl.com, relaunched last week after outlasting ElleGirl in print, and Radar.com, which is doing fine solo while Maer Roshan readies Radar's third coming on paper.
This week's conference, themed "Beyond the Page," will pursue the topic deeply, Ms. Hefner said. "We're kicking off with Rachael Ray deliberately, because she's a great example of how you take a brand personality and nurture it and extend it across platforms."
The pitfalls will stay -- cannibalization, anyone? -- but for now the business seems to have spotted opportunities in the new-media world, not just trouble. Publishers sometimes even sound cocky. "Our death has been predicted more frequently than Tony Soprano's," Mr. Kliger said. "Like him, we seem to find a way to survive."
Bashing Rival Media, Not Rival Mags: D
Publishers have to dial down the digs at print competition. Maybe everyone does it, but that doesn't help grow the pie. And while publishers take bites out of each other, web players lick their lips and eye magazines' slice.
Thankfully, recent research suggests that magazines and other media often work better for advertisers in combination than alone -- and that magazines are undervalued in the mix. This notion will get plenty of play at the conference. Then attendees have to take it home to marketers.