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Where the hurt is at the newsstand
By Diego Vasquez
Sep 1, 2009 - 8:10:29 AM
It would be tempting to blame the ever-sinking number of newsstand sales entirely on the economy, and certainly consumers’ lack of pocket money has hurt impulse buys of magazines from In Touch to InStyle. But that may just be wishful thinking on the industry’s part. The fact is, some of the declines have been prompted by other factors, from magazines’ perceived lack of timeliness, in a world of 24-hour cable news and near-constant internet access, to their bulkiness compared to a touchscreen smartphone. Newsstand magazine sales dipped 12 percent during the first half of the year, according to the Audit Bureau of Circulations, and some analysts say that newsstand sales will keep declining even after the recession is over. Indeed, 13 of the top 25 magazines in terms of single-copy sales saw declines of 10 percent or more. Subscriptions remain more stabile, meaning that despite the newsstand plummet, most magazines still made their rate base. Only one of the top 25 magazines in terms of total circulation, TV Guide, saw its total circ decline more than 9 percent. Jack Hanrahan, magazine consultant and editor and publisher of CircMatters, talks to Media Life about why magazines will have a hard time recovering, how many titles made rate base, and what numbers media buyers need to be paying particular attention to.
What's the most striking thing about today's ABC numbers?
Well, I thought the most striking thing I saw is how well a couple ethnic magazines did. Ebony and Essence did pretty well in single copy sales.
There’s been so much pre-release attention to these numbers, which is good, so you’re pretty familiar with things like Better Homes and Gardens will be down. People were reporting on the declines, but in the category of what was most striking, for me it was that two mature magazines did very well on the newsstands.
When do you expect newsstand sales to stabilize?
I think a lot of the problems at the newsstand are related to a lack of interest in reading magazines.
When the industry tries to promote how great magazines are, I think it would stabilize. To try to make people more regular buyers of magazines is going to take some sort of different marketing than what we’ve seen up until now.
How much of newsstand slowdown can be attributed to the economy?
I think the economy would be a very large part of it. That and just the lack of spur to buy. When there is a spur to buy, such as a death of a celebrity, people buy magazines. Yet the content of magazines is good and great week-to-week and month-to-month. And magazines need to tell people that.
The economy has played a much bigger role than the so-called Anderson problem [the closure of distributor Anderson News], but when it comes back I’m not guessing the single copy sales will turn around.
What categories of titles seem most affected by the newsstand slowdown (i.e., celeb magazines, women's, etc.)?
I have looked at categories and I’m looking for things that are performing different than the overall average. Business and personal finance magazines are down almost 20 percent at the newsstand.
Also, off a smaller base of single copy sales, parenting magazines have fallen even more than that. Shelter books, perhaps related to the real estate troubles, are down, although some titles within the category have done well.
The teen books have declines that are about the average, and health too.
Also, the auto books were down 17 percent. None of them really had a great first half.
What categories are holding up the best?
With a giant asterisk next to it, the newsweeklies did great. Because of the inauguration of President Obama, those issues sold so high above the average it helped make the first half for them.
Active sports, things like Backpacker, Runner’s World, Running Times—I categorize those differently than passive sports, and I know golfers get mad when I call it a passive sport [laugh], but those magazine were down 17 percent while active sports were down not quite 8 percent.
What numbers should media buyers be most concerned about?
This is the easiest one. The numbers they should be most concerned about are those that aren’t in FAS FAX [the numbers released yesterday].
This is just the top line. Beneath those big umbrella categories lies the details that media buyers need to dig into and become aware of.
As the publisher statements come out, a lot of attention will be paid, I hope, to things like sponsored sales. Sponsored sales are counted as paid subscriptions, and there’s been a lot of activity and offers – here’s a free subscription of magazine XYZ sponsored by Fandango, for example.
That’s a category of circulation that’s been rising very quickly and I suspect it will take another bump in the first half of ’09.
Media buyers should be worried about those numbers, but they’re not on FAS FAX.
With newsstand sales down, how are publishers ensuring they meet their rate base?
The facts are the publishers have actually done a really good job of meeting the rate base. Of those that claim a rate base, 91 percent met them during this period, and I think that’s impressive. It’s very consistent with the historical norm.
With all the things that had to do with the general economy, they made their promises whole to advertisers. And I think that’s an aspect of FAS FAX that doesn’t get as much press attention.
Some of the magazines also delivered very nice bonuses. Life & Style, although it took its rate base down, beat its guarantee by 22 percent. Women’s Health beat its new (increased) rate base by 10 percent. So those are good strong performances, and the tendency of magazines is to over-deliver, whereas with national TV, advertisers typically get their guaranteed weight outside of the flights they would have liked it in.
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