Where Print Advertising Still Reigns

city-and-regional-magazine-survey-2014-FOLIOPrint advertising may be atrophying, but it’s still important enough to be the overwhelming revenue stream for city and regional magazine publishers.

According to the latest annual survey of media in this category, conducted by FOLIO last month, most publishing titles continue to rely on print for the vast bulk of the revenues they generate.

But before we look at FOLIO’s figures today, let’s see what’s happened over the past decade or so.

Print advertising revenues in this segment of the publishing industry represented over 95% of overall revenue as late as 2005. It’s dropped since then – but it hasn’t declined all that much, all things considered.

Here’s what FOLIO’s research findings are showing today:

  • Print advertising: Represents ~75% of all revenues
  • Paid subscriptions: ~6%
  • Custom publishing: ~6%
  • Digital media: ~5%
  • Events: ~3%
  • Mobile products: ~1%
  • Mercantile data (e.g., list rental): Less than 1%

Compared to Folio’s 2013 survey, print advertising has declined slightly (from ~77% of overall revenues in 2013), but paid subscription revenues are down sharply (from about 10%).

Within this publication category, there are some differences between large and small publishers. Larger brands (those generating more than $5 million in revenues) rely less on print advertising; it’s only about 65% of their earnings.

With smaller publication titles, it’s been significantly more challenging to diversify away from print. They’re still relying on print ad sales to generate more than 80% of their revenue.  And that percentage hasn’t changed in five years.

Right now, digital media accounts for only about 9% of total revenues generated by the larger media properties in this segment. But managers at these publications anticipate that revenue from digital platforms will continue to grow at a faster clip.

In fact, they foresee a jump of nearly 30% in digital media revenues this year alone.

The FOLIO report notes that the increase in digital revenues is coming from better monetization strategies for existing products, rather than the introduction of new ones.

City and Regional MagazinesConsidering why publishers in the city and regional magazine category continue to rely on print versus other revenues, I think it goes back to the idea that consumers don’t consider these properties strong sources for “instant” or “breaking” news.

Behaviorally, there’s more of a propensity to browse through story topics in a more “linear” fashion. The emphasis on human interest and region-centric news also aligns more with a more traditional approach to journalism, where most every news story tends to have some sort of a “human” dimension.

Quite a few stories are long-form journalism, or ones that feature high-quality photography.  Far fewer of them are time-sensitive.  They lend themselves to a more leisurely perusal.

Even so, it would seem that broader trends regarding the way consumers are interacting with media — and the platforms they’re using to consumer them — destined to overtake the city/regional magazine category.

Eventually.

More details on the FOLIO research results can be found here.

Magazine advertising finally sees an uptick … sort of.

Print Magazines
An uptick in print magazine advertising -- however modest -- appears to be occurring.
Could it be that print magazines are finally on the positive side of the “U” in their recovery? The most recent stats on print advertising activities suggest that this may be so – if only slightly.

In statistics released this past week by Publishers Information Bureau, this data aggregator found that across all of the magazines tracked by the bureau, print advertising rose ~2.5% during the first quarter of 2011 compared to the same period last year. While not large, it is a gain, which is better news than most publications have had in quite a while.

PIB charted advertising growth in seven of the twelve advertiser categories it tracks, with the following segments showing increases year-over-year:

 Apparel and accessories
 Automotive
 Cosmetics and toiletries
 Drugs and remedies
 Financial, insurance and real estate
 Media and advertising
 Technology

As for the other categories, advertising was roughly even in women’s fashion and beauty magazines, while advertising categories that continued to decline were retail, food, home furnishings, and travel.

More specifically, how did some of America’s largest and most famous magazine brands fare? The answer is: “It depends.”

BusinessWeek: +49%

Elle: +15%
Vogue: +11%
Glamour: +6%
The Economist: +4%
The New Yorker: +4%
Time: +3%

 InStyle: -4%
Cosmopolitan: -9%
Harper’s Bazaar: -11%

Newsweek: -31%

There are explanations behind the outliers’ advertising performance. BusinessWeek has undergone an extensive redesign since its purchase by Bloomberg, and major resources have been poured into the publication to raise its profile and editorial muscle.

At the other end of the scale, Newsweek has struggled in the wake of its purchase by nonagenarian Sidney Harman, the retired chairman of Harman International Industries (Harman/Kardon) and husband of Jane Harman, executive director of Wilson International Center for Scholars and an ex-congressperson from California. Bringing Tina Brown onboard as “celebrity editor” at Newsweek hasn’t paid big dividends yet – at least in terms of advertisers returning to the magazine.

Does the uptick in advertising mean that print magazines are out of the woods yet? Hardly. Let’s not forget that the improved advertising figures are coming off of 2010’s low base levels that are nothing short of ugly. Print advertising is slowly emerging from the worst business environment faced by magazines since the Great Depression, after all.

But at least the direction is now “up” …

Condé-Nast Gets Real – and Reality Bites

Conde-Nast logoThis week, magazine publisher Condé-Nast announced the closure of four magazines, including two bridal publications plus the prestigious and well-known Gourmet Magazine title.

It’s an indignity for a publishing firm that has fallen pretty far pretty fast. For years, the company seemed by-and-large unaffected by the winds of change in the publishing industry. Even as other firms were belt-tightening and divesting themselves of low-performing magazine titles, the storied “in-your-face” Condé-Nast business style – replete with jet-setting executives and seemingly endless clothing and expense accounts – appeared to remain intact.

It didn’t hurt that parent company, Advance Publications, also owns cable TV properties that could help prop up the print publication segment of the business – at least for a time.

But with plunging ad page revenues from its luxury goods advertisers on the order of 30%+ throughout 2009, it was only a matter of time before the day of reckoning would arrive. And the sense of impending doom was only heightened when McKinsey & Co. consultants started roaming the halls, poking around the company’s headquarters like a nosy relative, asking all sorts of questions and taking notes.

And now, a few short months later, we have this announcement.

Accompanying the news of magazine closures and personnel layoffs, Condé-Nast reported that it is shifting its priorities to digital properties even while focusing on a fewer number of “core” magazine titles.

Will it be enough? One unnamed company executive was quoted in The Wall Street Journal as saying, “We’re going to make a go of everything else.” But I think that’s doubtful. McKinsey has recommended that nearly all of the remaining publications cut their budgets by upwards of 25%. Whether or not that happens – or whether it will be enough to save the remaining titles – is something we’ll be able to judge pretty quickly.

UPDATE (11/7/09)The New York Post is reporting that Condé-Nast has now hired Michael Sheehan, the famous crisis manager and media coach, to help the company with PR. Sheehan has coached presidential candidates from Clinton to Obama, as well as handling AIG Insurance’s PR during its financial meltdown in late 2008. Reportedly, Gina Sanders, publisher of Lucky magazine, prodded top brass to bring Sheehan in, citing deep morale problems at the company. Considering the dramatic events at the publishing house over the past year, this news is not at all surprising.