If you’ve been paying attention, the last few years were hard on magazine, book and newspaper publishers. Some of this had to do with the decline of the economy, the struggle of many over extended publishers to adapt to new technology (which is hard to do when you’re company is leveraged to the tune of a few hundred million dollars), the loss of circulation revenue as production and distribution costs crept up, and a sense that what you do is just not that interesting or important to your audience anymore.
In spite of it all, one of the surprises that I have experienced is how little the core work that I do has changed in the two years since I left the corporate world to go back out on my own. There’s a lot of new work to do, but the core remains constant. Many of my original clients are still working with me to one degree or another. Most of them are doing quite well in spite of everything our industry has thrown at them. Others are struggling and I appreciate the opportunity to help them sort out where they are going with their businesses.
Recently, a client asked me to justify the newsstand promotional expenditures that some of our retail trading partners now seem to “demand” we participate in. Below is a lightly edited version of how I explained it to them. What I had to say also fits in with where I think print, and contemporary retail, for that matter, may be going. Tell me what you think:
The commitment (of the retailers to the newsstand) shows up in several ways:
1) Neither chain has relegated the magazine section to the back of another section like we’ve seen in Wal-Mart and Target. Nor have they shunted the newsstand off to a dead aisle like you will sometimes see, for example in supermarkets or drugstores. In my last meeting with the buyer, (it was) pointed out that they’ve been able to hang onto their space in part because of the revenue that they gain from publishers continuing to promote. I know that … much of the profit they make in the newsstand department comes from promotions. ..
You see this scenario played out in many “hard goods” retailers and food retailers. Our situation is not that unique. Promotion is the profit for the retailers.
2) … chain has significantly cut the floor space that is available for the newsstand. While they’ve cut space elsewhere in what is their core business, magazine space, for the moment, remains constant. The goal of the buying dept. is to maintain their floor space presence…
…Will these (chains) stop selling print and shut down? Maybe. Maybe in two years, or five years or ten years. It’s hard to know exactly. That is why I read most of the articles that I see about this business with a … cynical eye. That isn’t healthy, but it’s one way I maintain my cool. Most of the people who write about magazine and book distribution – or even the publishing process for that matter, don’t seem know what they are writing about. They don’t know our business, our business model and, in many cases, they don’t know about the the new media that has them so excited. Their ideas for “fixing” us are interesting. But they’re ideas. If they were workable, wouldn’t we be putting them into action?
An excellent example is the offering this morning that BoSacks promoted. The first paragraph, about five sentences, contained enough misinformation to keep me busy debunking it for a week.
And I’ve already spent most of my day doing that for another client.
So what do you believe?