Consumer ABCs: Industry analysis

The latest release of magazine ABC results should be seen as a positive story because the combined print and digital editions UK consumer market was up +0.3% for Jan-Jun 2016 YoY. Although within this there are of course varying stories of results.

We continue to see strength from the freesheet market where there have been a number of launches (Coach, Balance and NME converting to the free model) and the news & current affairs sector performed well on the back of the turbulent political climate (with particular growth from their digital editions).

The Hearst stable has seen great success who have not only rolled out their dynamic distribution method to other women’s monthly titles (Elle and Harper’s Bazaar) but have under gone new routes to market (especially for their lifestyle division) through partnerships that entails providing magazine subscriptions to commercial partners who request these on behalf of their consumers as rewards for certain behaviours.

However, this overall circulation growth is not reflective of the print revenues for magazines, which, according to Nielsen, are down c.17% for this same period YoY. This illustrates that magazine advertising is still at the mercy of other media (especially exciting new digital opportunities) which gets more exposure to those who influence advertising budgets and media execution.

Magnetic (the trading body for magazines) has done a great job becoming established and showcasing the power of magazines (through research) to publishing/investment teams. However, they now need to clearly demonstrate the benefits of magazines to clients, planners and even creative agencies who are the influencers of budgets and media formats.

Although digital editions and magazine websites are performing well, publishers are struggling to monetise them to the same extent as the loss of print revenue from the magazines, especially with an increased amount of digital budgets going through programmatic trading desks.

Brands who are reaping the rewards are those amplifying their established brand and diversifying their portfolio e.g. Cosmopolitan and their multi-platform reach.

Beyond the freesheet and news and currently affairs, most other sectors saw declines YoY, especially sectors whose content can be easily accessed and updated regularly online, e.g. celebrity weeklies, food and home interest sectors.

In order to survive, these titles need to give readers a reason to purchase their title e.g. by offering exclusive content which can’t be found online or continues the journey from online into print.

The future for magazines will remain turbulent, even for the free market who, although at the moment are enjoying growth, need to future proof themselves for factors that could affect their reach, e.g. when Wifi eventually becomes available fully on all of the London underground.

Evolving distribution methods are key; ensuring that their content is getting into the target audiences hands are the right time. Publishers will also need to continue to explore, test and diversify their portfolio to balance out losses elsewhere in the business e.g. events, acquisition, and partnerships.

We need to remember that over 55 million consumer magazines are bought/distributed in the UK each month, this needs to be recognised and utilised more as an engaged fully immersive medium.

This period’s ABC consumer magazine brand release reinforces the essential role the ABC plays in reporting brand health for publishing houses.

Circulation remains the bellwether of performance, sales and publishing viability for the paid-for titles that still derive valuable revenue from cover price. Indeed, even in the absence of this revenue, independent circulation verification is also equally crucial for the ‘freemium’ sector, given the direct correlation it will have with advertising income.

The ABC is the only organisation that still provides such a comprehensive gold standard service. They should be applauded for their robust outputs and reporting – long may this continue.

It has been well documented that circulations of the printed word remain under sustained pressure. There’s no surprise then that pioneering distribution methods are increasingly coming to the fore. Hearst Magazines broke new ground last year with a hybrid circulation model for its flagship title Cosmopolitan.

Following the success of Cosmo at the last ABC, Hearst are rolling out the distribution paradigm to Elle and Harper’s Bazaar in September. This is a very interesting development given the strong fashion and luxury credentials of both brands.

It will be fascinating to see if or indeed how the competition respond, but there is no doubt such initiatives will introduce new and lapsed customers into the market. It will however potentially compromise sales from the other magazine brand houses – notably Condé Nast.

Whilst this has been a very challenging period for many, there are many positive narratives and indicators. The more progressive publishers are continuing to adapt and innovate more than ever to ensure their brands not only breathe but thrive once again in an ever competitive connected world.

“Insanity: doing the same thing over and over again and expecting different results” – Albert Einstein

Yesterday marks the bi-annual consumer magazine ABC results covering Jan-Jun 2016. Circulation remains one of the industry’s key trading currencies, and as such, these results warrant consideration.

New ways of reaching readers has become one of the highlights of this year’s results, with the likes of Cosmo, Esquire, Elle and The Week distributing monitored frees at stations, events and retail outlets (amongst other venues).

Recruiting new readers must always be applauded, so there is optimism that this approach will deliver long-term results, although it will be take time to establish whether this converts to long-term readership.

So far, the results show a positive effect on the overall figure, but inevitably the actively purchased figures now reflect a smaller percentage (some as low as 50%). Time will no doubt tell on this particular route, but of the latest results, it’s encouraging to see growth from a number of titles as a result of this new course.

The immediacy of celeb news online continues to bother the women’s weeklies, with struggling results almost across the board. Inevitably, the instantaneous way the latest celeb divorce/plastic surgery/marriage is reported online is impacting the celeb weeklies, who have traded on this content for years.

Whilst this isn’t new news, the weeklies are continuing to combat this with non-ABC reported activities in the form of events, social and video.

For some time, publishing brands have been more than the printed edition, and increasingly brand worth cannot be monitored by circulation alone. In fact, ‘cross-platform’ no longer seems to cover the brand extensions that are taking place in the market.

As the ABC increasingly monitor broader figures than circulation alone, we continually need to view publications in a 360 manner.