Magazine Circulation Falls in First Half

Magazine Circulation Falls in First Half
By Irin Carmon with contributions from Stephanie D. Smith Amy Wicks
From WWD Issue 08/08/2008
http://www.wwd.com/media-news/magazine-circulation-falls-in-half-1706249#/articlehttp://www.wwd.com/media-news/magazine-circulation-falls-in-half-1706249?full=true
The phrase "flat is the new up" became a mantra in recent years when it came to assessing newsstand sales. Well, as core fashion titles, women's service books and men's magazines have almost universally posted declines in their single-copy sales in the first half of 2008, how does "less down is the new up" sound?

To wit, Hachette Filipacchi Media's Tom Masterson, senior vice president for consumer marketing and manufacturing, pointed out that, while Elle's newsstand was down 6.3 percent in the first six months, "many of Elle's competitors decreased more."

That's true - Vogue was down nearly 15 percent, though it still outsells Elle on the newsstand by an average of about 50,000 copies monthly; Harper's Bazaar fell 8.3 percent, and W, which gets the vast majority of sales through subscription, was down 10 percent.

Or take Shape, which was down about 10 percent overall on the newsstand in the first half, but still averaged higher total sales than the troubled fitness category in general. (Self had the dubious honor of being less down, but is still smaller; Shape has beefed up its distribution at checkout and added 17,000 pockets nationwide.)

Growing market share might be the last remaining competitive advantage in an environment where nearly every editor in chief is seeing the kind of declines that once would have gotten them fired. The long-standing expectation that a healthy magazine is one that sees successive growth on the newsstand is in question - you can't exactly fire everyone.

Whether the change is cyclical (uncertain economic times that include high gas prices, fewer supermarket trips and less disposable income) or secular (consumer behavior is undergoing a fundamental change away from newsstand, or from print magazines themselves) depends on whom you ask. Editors and publishers would have it be the former.

"I don't think newsstand softness is systemic to magazines, but rather systemic to the economy," said O, The Oprah Magazine publisher Jill Seelig.

But some advertisers and observers are beginning to wonder whether the second diagnosis is upon us. As consumers' attention fractures, spoiled by choice and easy digital access, the culture and entertainment industries already have adjusted their expectations, counting smaller sales numbers than ever as blockbusters. The magazine industry might be falling prey to the same tectonic shift.

Several magazines, such as Glamour and Marie Claire, have seen disappointing sales for several periods in a row, even when the economy was flush, suggesting more of an overall move away from big women's titles. (Perhaps in reaction, Glamour unveiled a redesign this month.) Even newsstand stalwart Cosmopolitan dropped 6 percent in this period, a difference of more than 100,000 copies, after essentially flat newsstand sales since 2004.

The only source of growth across the board has been in total circulation, which, given the newsstand declines, usually means that publishers are spending more than ever to build and maintain their subscriber bases. And advertisers are traditionally more skeptical of that kind of audience-building, given publishers' past practices of steeply discounting subscriptions.

That Men's Vogue's newsstand is down 39.1 percent, for example, even as it's raising its rate base to 400,000, can be explained several ways: first, that it suffers from an apples-and-oranges comparison between five issues published in the first half of 2008 and three in the first half of 2007; second, and more significantly, that it's growing its audience the expensive way, through subscriptions, and not wowing on the newsstand.

The title also has seen its verified circulation (bulk copies in public places) drop by 14 percent since last year. A spokeswoman said, "Men's Vogue continues to take risks on covers to recognize accomplishment over celebrity." Case in point: the model-free Bugatti cover in May, which sold 45,000 copies, according to Rapid Report. (That was still better than the worst cover to date, April with Alex Rodriguez, at 41,000.)

As such, given the flood of negative newsstand figures in the first half, the few examples of uptick in sales should be particularly celebratory - among them, In Style, which, whether you consider it a core fashion title or a peer of Glamour and Marie Claire, was the only one in either group to see any rise in newsstand, by 4 percent to 783,254. That's before the recently unveiled redesign was even tested on the newsstand.

And Rodale's David Zinczenko showed once again that he can put his money where his mouth is, maintaining Men's Health's position as the number-one newsstand seller in the men's category with a 2 percent growth, and having a hand in two newer magazines, which also have seen good news: Women's Health, with its 12 percent rise, and Best Life, up almost 20 percent. Maybe that's why Men's Health Living has been given a go-ahead in a tough environment for shelter magazines.

So, do the steep declines serve as a harbinger of equally sharp falls in advertising revenue as firms seek other media? Well, for now, media buyers seem to be seeing the big picture. "I don't think we would have seen these types of declines if the economy had been in a different place," said Robin Steinberg, senior vice president and director of print investment and activation at MediaVest. "We would have seen some declines, but not deep declines." That said, she added: "The future of magazines is not going to have the same distribution exposure as in years past," as the business model shifts from emphasizing the number of eyeballs to assessing quality of audience.

And media companies are experimenting with new distribution tools such as Maghound, the so-called "Netflix for magazines" launching in September. A subsidiary of Time Inc., Maghound will allow consumers to switch in and out titles for a flat monthly fee, and around 300 titles have signed up so far.

Magazine publishers also are trying to figure out how to leverage their Web sites to build a subscription base - a potentially more efficient, or at least cheaper, way to add subscribers than direct mail or verified circulation. Hearst magazines in particular - many of which tend to be big, single-copy-heavy titles in an age of grim newsstand - have suggested this as a winning strategy. In the face of a newsstand decline of 17.3 percent, for example, Oprah's Seelig pointed to the fact that the magazine hasn't had to resort to verified circulation and that subscriptions were up 7 percent, in part because "we played around with the subscription offers on Oprah.com."

She added, "The simple truth is consumers are not going to the places where our magazines are sold as frequently as they were," i.e., airports, supermarkets, drugstores and other retailers.
That said, the magazine recently saw the exit of editor in chief Amy Gross, billed as voluntary, and new editor of former Golf for Women editor Susan Reed will have to figure out how and if the newsstand can be turned around. George Janson, managing partner/director of print at Mediaedge:cia, said, "Some magazines have reached a natural level of circulation," pointing to Oprah in particular.

"Magazines are also coming off a period where [advertising] spending and circulation have, for the most part, been flat to up," added Janson - meaning that what goes up sometimes has to come down.

But if the latest newsstand numbers prove to be long-term indicators, publishers could be faced with hard choices, such as cutting rate bases or rethinking their distribution models. "As content becomes free on the Internet, I question whether or not the future of magazines will be opt-in and nonpaid," said Steinberg.

Magazine Suspends Its Run in History

Magazine Suspends Its Run in History
By CHARLES McGRATH
http://www.nytimes.com/2007/05/17/arts/17heri.html?_r=1&adxnnl=1&oref=slogin&ref=arts&adxnnlx=1179401519-DttO7Edd5Fwuor+pZDfZqg

After more than 50 years American Heritage, the magazine that furnished not just the minds but, in its original hardcover format, the dens of generations of American history buffs, is suspending publication, its editor, Richard F. Snow, said last week.

The bimonthly magazine, which is owned by Forbes Inc., has been for sale since January, and in the absence of a buyer, Mr. Snow said, the publishers have decided to put the next issue, June-July, on indefinite hold. For at least the time being, however, American Heritage will continue to maintain a Web site.

That leaves Mr. Snow and his staff, which has dwindled to four from a dozen, in limbo, where they have been since just before Christmas, when they were informed that the magazine was going on the block. “It’s a little like sailing the Flying Dutchman through the fog,” Mr. Snow said. “On the other hand, I’ve been here for 40 years, so I can’t really bitch about job instability.”

The magazine has always been a bit of an anomaly among American publications.

The circulation is currently 350,000, or as high as it has ever been, and hundreds of those readers can still be reliably counted on to write in arguing about the true causes of the Civil War or, as happened recently, to point out that the author of a World War II article doesn’t know the difference between the M-1 rifle and the M-16, which didn’t come in until Vietnam.

American Heritage was founded in 1954 by James Parton, Oliver Jensen and Joseph J. Thorndike Jr., refugees from Life, who from the beginning broke most of the rules of magazine publishing. They determined not to accept ads, for example — on the ground that there was a “basic incompatibility between the tones of the voice of history and of advertising” — and instead charged a yearly subscription of $10, a figure so steep at the time that readers were allowed to pay it in installments. They also published in clothbound, hardback volumes with full-color paintings mounted on the front.

The format was an instant hit with readers, who instead of tossing back issues often shelved them in their bookcases, but it initially confounded the United States Post Office, which decreed that American Heritage could use neither the book rate nor the periodical one. That ruling was eventually overturned, but not until the magazine had almost bankrupted itself by paying for parcel post.

The first editor of American Heritage was Bruce Catton, a Civil War historian who wrote in the inaugural issue in December 1954 that “the faith that moves us is, quite simply, the belief that our heritage is best understood by a study of the things that the ordinary folk of America have done and thought and dreamed since first they began to live here.” In the beginning, at least, that meant a fair amount of WASPy nostalgia and a steady ration of stories about the Civil War. That inaugural issue, for example, includes a piece about a Union general who was falsely accused of treason in 1862, as well as articles about the country store, the Fall River steamship line and a lament by Cleveland Amory about the decline of New York men’s clubs.

Mr. Snow, 59, went to work in the American Heritage mailroom in 1965, when Columbia University insisted he take a little time off, and joined the staff full time when he finally graduated, in 1970. He has been there ever since, and in 1990 he became the magazine’s sixth editor, succeeding Byron Dobell.

Either he was a perfect fit to begin with, or over the years he has taken on many of the characteristics of his workplace, for he now closely resembles his own magazine. He is quite youthful looking, on one hand (probably because he is one of those people who mature early and then never change), and a little old-fashioned on the other. He speaks in perfectly turned paragraphs and may be the last person left in New York to unself-consciously use “indeed” as an exclamation.

He favors gray suits and sweater vests, his telephone manners are impeccable, and he has a bubbling, high-pitched voice that turns a simple “hello” into something that resembles the opening bar of a Broadway show tune. Like his magazine he has an almost insatiable curiosity and is particularly expert on the Revolutionary and Civil Wars, not to mention Coney Island amusement rides at the turn of the last century.

Mr. Snow has been at American Heritage long enough that he can remember when it was an empire in the mid-’60s, employing 400 people, with the magazine as a flagship for what was in effect a publishing company selling books, many of them by some of America’s best-known popular historians, by direct mail. He was managing editor in 1980, when the magazine ceased publishing in hardback (except for subscribers who wanted to shell out extra for what Mr. Snow now calls a “padded, leatheroid edition”), and in 1982 when, bowing to economic necessity, it began soliciting ads.

“We all felt very bad about taking advertising,” Mr. Snow recalled. “But it had the odd effect of making us feel we were in touch with the world. There was a sense of a living connection to a process that was actually sort of fun — or at least it was fun while we were getting ads.”

American Heritage remained more driven by circulation than by ads, however. According to Scott Masterson, a senior vice president at Forbes and president of American Heritage, the magazine was losing money when Forbes bought it in 1986 and then bounced back for a while. But in the late ’90s, Mr. Masterson said, it failed to reap the kind of profits that many magazines did, and after 2001 it experienced the same downturn that afflicted the magazine business in general and had trouble recovering.

Part of the problem was the Internet, Mr. Snow said. “We’re really a general interest magazine,” he said. “We don’t play to a history buff in any narrow sense — like the Civil War re-enactors, for example. They can go on the Web and get thousands and thousands of hits.”

Three years ago Mr. Snow and Mr. Masterson decided to embrace the magazine’s aging readership and rejiggered American Heritage to appeal more specifically to baby boomers, mostly publishing articles about things that had happened in their lifetime. The formula was an editorial success, Mr. Snow said, yielding articles like one that appeared in the February-March issue about the Wrecking Crew, an unheralded studio band that played on many hit records in the ’60s and ’70s. But it failed to provide the hoped-for bump on the business end. “Forbes has been very, very patient,” he said. “but basically they’ve been carrying us for a while.”

Over lunch recently at Keens — another venerable New York institution, decorated with old clay pipes and playbills and where he pointed out, for the sake of accuracy, that the famed mutton chop is really lamb — Mr. Snow lamented that the next issue of American Heritage might never get into print.

“We’re just about finished with the issue, and we have a particularly fine piece by Teller, the nontalking half of the Penn and Teller team,” he said. “It’s a superb piece of writing, an essay about a fellow named David Abbott, who was a great American magician.”

Mr. Snow added, “You know, some issues are better than others, but I don’t think there’s been a single one where anything really bored me.”

He said he was still unsure about his own fate, but if need be he could go back to writing historical novels. “I’ve written four,” he said. “Two were loathed by everyone who read them, but two actually got published.” And no matter what happens, he has worked out a crucial point of his severance: He gets to keep his Royal manual typewriter.

“That was the typewriter I was assigned in 1970, and it will follow me to the grave,” he said, and he added: “I wish this were more a sign of granitic stability, but in fact it’s a sign of my computer incompetence. I use it just to type labels, but it works beautifully. Every year someone comes in and cleans it. I don’t think he’s paid by Forbes. He’s some spectral presence who just turns up.”

Marketers to Mags: Give Guarantees or We'll Walk

Marketers to Mags: Give Guarantees or We'll Walk
Exclusive: MediaVest Wields $900 Million to Land Issue-By-Issue Circ Promises
By Nat Ives
http://adage.com/mediaworks/article?article_id=116544

NEW YORK (AdAge.com) -- Kraft, Wal-Mart and Coca-Cola are among the marketers that are prepared to stop spending in magazines if they don't get issue-by-issue circulation guarantees.
Robin Steinberg, senior VP-director of print investment and activation at MediaVest, insists that magazines should make issue-by-issue circulation guarantees to marketers.

Media buyers long have been frustrated with many magazines' insistence on guaranteeing only average paid circulation -- instead of guaranteeing the paid circulation of specific issues in which ads actually appear. But now MediaVest USA has gathered support from heavyweight clients to make issue-specific guarantees a reality.

"Let me be clear that I am a print champion," said Robin Steinberg, senior VP-director of print investment and activation at MediaVest. "However, we believe that all publishers should make this guarantee, and we will walk away from business for those who don't." MediaVest spent about $900 million in consumer magazines on behalf of its clients last year.

New leverage
The new power play reflects the growing demand for precision metrics in the media business, a drive fueled by an internet model that seems to promise instant accountability. It is also, though, part of a broader regime change in the industry, one that has delivered dominance to advertisers from media owners. Marketers now have too many options and have found too many ways to sell themselves, beyond traditional advertising, for publishers or broadcasters to keep setting the agenda. There's a reason commercial ratings on TV have arrived at last: Advertisers seem to finally have enough leverage to force the issue.

"As somebody who's ultimately paying the bills, what I'm looking for is accountability and transparency," said Donna Campanella, executive director for global media at Avon, a MediaVest client. "We want to make sure that the impressions we were hoping to get for a particular issue have been delivered. Because what we advertise is coordinated with what's in our brochures, timeliness is important."

"In this age when there are so many choices out there, particularly in the digital arena, traditional media needs to step up and really prove their value, good or bad," Ms. Campanella added.

But change still doesn't come easily or instantly. Time Inc., the country's biggest magazine publisher, guarantees most advertisers an average paid circulation across the issues in which they buy space; if you buy into five issues, the company promises those five issues will achieve a certain average paid circulation.

Pressure
Anything else would only hike costs for everyone, said John Squires, senior exec VP at Time Inc., because publishers would pump up print runs to make sure not one issue falls even a percentage point shy of its rate base. "They want all guarantees and all protections at all times," he said of marketers and media buyers. "That just kind of forces a completely unrealistic expectation on our business. We do have to concentrate on some efficiencies."

Publishers don't get any reward when magazines sell more copies than guaranteed, Mr. Squires noted. And swings of 50,000 copies in newsstand sales at magazines that consistently sell millions can't be the top challenge in marketing right now. "In these times, in this world, with the kind of competitive pressure that there is on publishers already and the intense pressure on rates, is this really a big issue?" he asked.

Ms. Steinberg said advertisers need protection against tactics publishers can use to meet average guarantees. A few titles have made up for shortfalls early in the standard six-month reporting periods by drastically increasing their use of copies -- called "verified" by auditors -- that are distributed in hair salons, doctors' offices and so on. "Verified circulation was put forth with the notion that publishers would use and place these copies strategically and with transparency," she said. "However, we believe the proper use is not taking place, and the current use is to make up for rate base underdelivery from newsstand decline."

A challenge from Hachette
Hachette Filipacchi Media U.S., publisher of magazines such as Elle and Car and Driver, already has started selling its men's enthusiast titles against issue-specific guarantees and is considering doing the same across its portfolio next year. But if Jack Kliger, president-CEO, is going to meet the buyers' challenge, he has one of his own for them.

"Issue-specific circulation-based pricing, to me, is an interim step to issue-specific audience-circulation guarantees," he said. That is to say, once the industry can better measure how many people see an issue, whether they borrow it from a friend or read a public-place copy, media buyers should drop this obsession with refining paid-circulation metrics. "It's like trying to make the kerosene lamp produce more light because that's what we're familiar with," Mr. Kliger said, "and don't trust this newfangled electricity thing."

Circulation figures don't tell whole story

Circulation figures don't tell whole story
Earl Maucker
Editor
http://www.sun-sentinel.com/news/opinion/columnists/sfl-emcol06may06,0,1139889,print.column

Back in the 1960s when I was a paperboy for the Alton Telegraph, I used to groan each time I received a new subscription order. One more paper to deliver, I thought, more weight in the bag, more time on the route -- less time for play.

Ah, for the good old days of circulation growth.

Fast forward to 2007 and once again we're reminded in stories this week that circulation of newspapers across the U.S. is in decline.

Pretty dismal stuff, it would seem.

But wait. Let's take a deeper look at the facts before we start writing off the future of newspapers.

Yes, circulation figures are dropping in most regions of the United States. That's hardly surprising in today's environment, with so much media fragmentation, so many ways to get news and information.

In reality, some of the circulation declines are deliberate, as publishers seek value from papers they do distribute.

More and more newspaper companies are limiting or eliminating entirely the newspapers they give away for free or at a major discount because, generally, those newspapers are not well read.

But beyond the number of newspapers in the market, experts and analysts in the business say newspaper advertisers care more about readership, which measures whether people are actually reading the paper instead of tossing it into the recycle bin without so much as a glance.

Our focus here at the Sun-Sentinel has been on home delivery or single copy sales, areas where we believe there is substantial value.

The agency that monitors circulation of newspapers is the Audit Bureau of Circulation, which, in my opinion, is still back in the 1960s in the way they count and report numbers.

Sure, they break it down even to the zip code level. They calculate circulation in the primary region and secondary regions of the newspaper's market, individually paid subscriptions, bulk sales, third-party sales and a host of other metrics including total readers of the daily newspaper.

But what they don't report is the total audience a media company like the Sun-Sentinel reaches through its various publications and electronic channels.

Even with fewer copies on the street, our readership is up from what it was two years ago.

The published audits do not take into account the impact of the Internet or subsidiary publications.

We, like most major newspaper companies, are major players in this relatively new, still-evolving medium.

For us, it's Sun-Sentinel.com

Which, by the way, has grown in audience traffic every year it's been in operation.

"We're seeing good audience growth online. So far this year, our Sun-Sentinel.com page views -- one way we measure our audience -- are up more than 12 percent over the same time in 2006," said Kathy Skipper, vice president & general manager for Sun-Sentinel Interactive. "We believe several things are contributing to this growth -- regular news updates, more video and more databases that are focused on helping consumers.

Combined with millions of page views per month on our Internet site and the distribution of our main newspaper, plus niche products like the Jewish Journal, City & Shore magazine, City Link, Teen Link and other products, our total audience reach has grown tremendously over the past few years.

"We recognize that in order to reach our audience effectively we must serve our customers on multiple platforms," said our General Manager Howard Greenberg. "Through Forum Publishing we have the largest family of weekly community publications in South Florida as well as the largest Spanish language audience in the Broward-Palm Beach market through el Sentinel, our Spanish language weekly."

No one is denying that newspapers are dealing with enormous challenges in today's world of fragmented media and the influence of the Internet.

But newspapers and the journalists that work on them have a healthy future ahead, as we transform our business to the new world of multiple media.

The good news is that the appetite for news has never been more robust.

We intend to serve our customers the way they like it.

NAA, ABC Report Newspaper Circ Slide

NAA, ABC Report Newspaper Circ Slide
Wednesday, May 02, 2007
By Chandra Johnson-Greene


According to the Newspaper Association of America’s Fas-Fax analysis of circ data for the six-month period ending March 31, the average daily circ for the 745 newspapers reporting for comparable periods was 44.9 million, a decrease of 2.1 percent over the same period a year ago.

On Sunday, the average circ for the 601 newspapers reporting was 48.1 million, a decrease of 3.1 percent over the same period a year ago.

The New York Times lost daily circ and is down 1.9 percent to 1.1 million, while its Sunday edition fell 3.3 percent to 1.6 million. Both USA Today and The Wall Street Journal, on the other hand, both reported small increases, with +0.2 percent (2.2 million) for the former and +0.6 percent (2 million) for the latter.

“The latest ABC circulation figures are in range with what we expected,” stated NAA president/CEO John F. Sturm.

Sturm says the losses are due to publishers moving away from “short-term circulation sales programs toward longer-term marketing initiatives that deliver the most value and make economic sense.”

Sturn’s statement is confirmed by the NAA’s 2007 “Circulation Facts, Figures & Logic” study of newspaper and circ marketing practices, which was released in conjunction with the Fas-Fax analysis.

The study found that newspapers are retaining subscribers in greater numbers, with subscriber churn down to 36.5 percent in 2006, compared with 42.1 percent in 2004 and 54.5 in 2000.

The only newspapers that seem to be immune to the current circ trends are the New York tabloids.

Weekday circ for the New York Post rose 7.6 percent for the six months ending March 31 while the Daily News saw a 1.4 percent gain, according to ABC.

The Post’s Sunday paper rose 6.2 percent to 439,202 while the News still leads Sunday circ despite a 2.8 percent decline.

From Bad To Worse: Newspapers' Circ Declines

From Bad To Worse: Newspapers' Circ Declines
by Erik Sass, Tuesday, May 1, 2007 8:00 AM ET
http://publications.mediapost.com/index.cfm?fuseaction=Articles.san&s=59553&Nid=29924&p=204904

AMERICA'S FLAGSHIP NEWSPAPERS ARE STILL afloat, but their crews may want to don swimsuits soon. The Audit Bureau of Circulations posted numbers Monday showing that in the six months ending March 2007, total daily circulation fell 2.1% to 44,961,066. Sunday circ fell 3.1% to 48,102,437, compared to the same period last year.


The ABC FAS-FAX numbers follow a litany of bad industry news over the last few weeks, including weak first-quarter earnings from leading newspaper companies, and a decline in the housing market, with ominous implications for newspaper classifieds.

This marks the 17th straight year of decline for both weekday and Sunday circs; this is an industry in distress. Indeed, the latest ABC FAS-FAX numbers look almost identical to previous figures, released biannually in what has become a grim drumbeat of contraction. In the September 2006 report, daily circ fell 2.8% as Sunday circ dropped 3.4%; in March 2006 they fell 2.5% and 3.1%, respectively; September 2005, 2.6% and 3.1%; and March 2005, 1.9% and 2.5%.

As in previous years, big metro dailies took some of the biggest hits, with The New York Times down 1.9%, the Los Angeles Times down 4.2% to 815,723, The Washington Post down 3.5% to 699,130, Chicago Tribune down 2.1% to 566,827, Houston Chronicle down 2% to 504,114, Dallas Morning News down 14.3% to 411,919, the San Francisco Chronicle down 2.9%, Long Island's Newsday down 6.9% to 398,231, and The Boston Globe down 3.7% to 382,503.

These figures actually contain (relatively) good news for some of the big titles, as their percentage rate of decline appears to be slowing. In the September 2006 ABC report, the New York Times' daily circ was down 3.5%, Los Angeles Times 8%, San Francisco Chronicle 5.3% and The Boston Globe 6.7%. On the other hand, losses accelerated slightly at the Chicago Tribune and The Washington Post, increasing by about half a percentage point.

In this gloomy environment, publications that hold their own are success stories: USA Today's circ is up 0.5% and The Wall Street Journal grew 0.6%. The biggest standouts were New York City's two daily tabloids, as the New York Daily News grew 1.4% to 718,174, and the New York Post jumped a remarkable 7.6% to 724,748.

In recent weeks, the nation's biggest newspaper companies have posted weak first-quarter results, citing revenue declines due to Internet competition. In the first quarter of 2007, the New York Times Company saw print ad revenue decline 3.4%, compared to the same period last year, as total profit fell 9.9% to $54.5 million. At the Tribune Company, overall operating revenues slipped 4% to $1.2 billion and operating profit was down 16% to $181 million. Gannett saw total revenues decline slightly from $1.88 billion in 2006 to $1.87 billion in 2007, as net income fell from $235.3 million in first quarter 2006 to $210.6 million in 2007, a roughly 10.5% drop.

Rapid Report's Slow Burn

Rapid Report's Slow Burn
by Lucia Moses
http://www.mediaweek.com/mw/news/recent_display.jsp?vnu_content_id=1003577820



When the Audit Bureau of Circulations launched Rapid Report last July, publishers were said to enthusiastically support the online service, recognizing advertisers wanted to get circulation numbers more frequently than the twice-annual publisher’s statements. In fact, 15 percent of ABC magazine members surveyed said they expected to sign up for the free, voluntary service.

Almost a year later, a mere 70 titles have signed on—less than 9 percent of all magazine members and far below the 250 or so of the biggest publications that the service was aimed at. And one of the charter participants and biggest supporters, American Media Inc., has stopped reporting numbers for Star, one of its biggest titles.

While all the major publishing houses have at least some representation, media buyers said that without participation by all the magazines in a given category and by newsstand-heavy titles, the service has little utility.

Still, there’s no talk of shelving the service anytime soon, which provides topline circ estimates within weeks of the on-sale date. But ABC board members representing publishers and advertisers said they’re disappointed in the rate of sign-up for the service.

“Rapid Report clearly has the support of [AMI] in terms of large, multi-title companies,” said Jack Hanrahan, U.S. print director, OMD, and a member of the ABC’s magazine buyers’ advisory committee. “It doesn’t have the support of Time Inc., Hachette Filipacchi, Hearst [Magazines], Condé Nast.”

While AMI has had all 13 titles reporting from the start, David Leckey, AMI’s executive vp of consumer marketing and an ABC board member, said the publisher stopped reporting numbers for Star March 12 due to lack of participation by its competitors, although he added it would resume reporting if one of them came on board. “We are commended for taking a leadership role, but I’ve constantly seen it turned against us because competitors have access to Rapid Report,” he said. “The media have used it to a degree against us. We support the ABC’s initiative, but we will not place ourselves at a competitive disadvantage.”

In terms of other publishing companies, OMD’s Hanrahan Time Inc.’s Sports Illustrated is the only weekly participating, and it’s mostly subscription-based. “In Style is a good choice to put on there, even Real Simple, but if you’re focused on what’s the most relevant weekly for buyers to know more about, it would be People,” Hanrahan said. “SI has not even 2.5 percent of its copies in single-copy sales. And [Us Weekly publisher] Wenner Media doesn’t participate at all.”

A Time Inc. rep said the company supported the service and was considering adding other titles. Wenner, meanwhile, wouldn’t comment, and Condé Nast did not return calls. Hachette supports the service, having put on three of its biggest titles—Car and Driver, Road & Track and Woman’s Day—and plans to fold in other titles in the future, a company spokeswoman said. Hearst, with two magazines reporting, is evaluating the accuracy of the data, said John Hartig, head of consumer marketing. “We are open to adding more titles as advertising interest grows, but we’d like to better understand how agencies are using the data before jumping into it full force,” said Hartig.

Publishers have been concerned about rivals seeing their numbers and how buyers will use the data. But buyers said the information provided by Rapid Report is too new and lacking in context to be used to penalize publishers.

“We don’t have enough research to know why newsstand numbers are going down,” said Robin Steinberg, senior vp, director of print investment, MediaVest USA, and an ABC board liaison. “This report was created simply to help manage and view the numbers at a more rapid rate. The biggest challenge voiced by publishers is the fear of buyers making immediate plan changes based on these fluctuations. However, the reality, is we don’t make changes based on a single piece of information.”

As for publisher objections that the process is cumbersome and numbers are a moving target, Leckey said that as the person who posts AMI’s data, he can attest that it’s not, adding that there’s no deadline to file and numbers can be updated continually. “It’s Turbo Tax,” he said. “It’s very, very easy.”

Observers said the low level of Rapid Report participation is a stumbling block to fulfilling the desire many publishers have to move to an audience-based measurement system, and that the ABC may eventually have to pull the plug. “I don’t think we need to get 100 percent [of ABC members] on Rapid Report, but I’d like to see us get to 20 percent of our membership,” Leckey said. “If participation’s not there, [the ABC] may have to rethink their allocation of resources.”

Another ABC director, Judy Vogel, research director at PHD USA, put the onus partly on her peers to increase participation. “I believe the buyers are not screaming enough about it,” she said. “Short of something that is somewhat punitive, what repercussions are there if they don’t participate? We’ve got to send a stronger message to publishers.”