In Which Captain Obvious Drops in for a Visit

Earlier this month, the release of the latest rounds of newsstand sales numbers from industry data consolidator MagNet resulted in yet another flurry of concerned articles from the magazine industry trade press.

News reports about newsstand sales fascinate me. They tend to follow the 21st century digital reporting trend of reviewing someone else’s work and then writing about it. The Folio report was thorough and it went through the numbers and pointed out what was up and what was down and how dire the numbers looked.

Thank you. There’s no way anyone in magazine media couldn’t have have sussed that out on their own

Medialife performed a similar feat. However they also helpfully pointed out what category was down the most. In case you missed it, it was the celebrity and weekly titles. They also informed us that this could be because of free stuff on the web.

Free stuff on the web! Who knew?

Folio upped the ante a few days later with some stern warnings from industry Cassandra, Baird Davis* who continues to point out some practices contemporary audience development practitioners use to prop up their circulation numbers that seem to contribute to the problem: Verified subs, sponsored subs and other free or low revenue generating copies.

I’m convinced that no self respecting audience development/circulation professional would challenge any of these assertions because they have a point.

But that’s not the point. Circulation people are doing these things either because we’re being told to (so we have to), or it may actually be working for that publisher’s big picture (Which may not take newsstand distribution into account because – well, it just doesn’t).

So here’s the thing:

We can blame the decline of newsstand sales on the expansion of the mobile web. We could blame it on the fact that no one wants to read “magazines”.

Newsstand professionals may also cite the rapid consolidation the industry experienced, the high level of discount and promotional demands put on publishers that prevents them from investing in any further newsstand development. Other people close to the business might bring up merchandising failures, failures to follow on-sale dates. They may cite what they consider to be a weak wholesaling system. You name it there are dozens of reasons for a declining newsstand sales.

Then there is the issue of ridiculous subscription pricing tactics. That’s a good one. Why would you spend $5.00 at retail for one copy of Time Magazine when you can buy a six month subscription to the magazine for just $5.00?

That is a very good question. And I’d love to see a study that answered it.

Baird, and others who have written about the newsstand correctly point out that the rise of SIPs and Book A Zines creates a zero sum game where the consumer will spend $9.99 (or more) for a fat magazine filled with pictures and articles and then decide not to pick up the $4.99 monthly.

Good point, that one.

In fact, they are all excellent points and have some validity.

People do walk around these days with their noses stuck in their smart phones.

The industry did consolidate rapidly and it feels like we continue to endure earth-shaking re-arrangements that impact our finances, our ability to merchandise, our relationships with our retailing and wholesaling partners.

Subscription pricing is a challenge.

I found it very interesting that while these articles did a great job of consolidating the MagNet numbers and repeating Baird’s warnings, none of them reached out to any actual publishers. They could have talked to the publishers who experienced growth in the last year: Kappa, Trusted Media, Topix, Hoffman and asked them what they were doing differently and what was working for them. They could have asked other publishers why they thought sales were down so much and what they were trying to do about it. I know a few in both categories.

Sometimes I wonder if it matters. Does anyone really care about single copy sales outside of reciting “frightening” numbers every six months and offering casually obvious observations:

Because in the end, I would asset that the problems at the newsstand have more to do with the problems facing bricks and mortar retailing than anything else.

In the 1990’s retailers demanded wholesaler consolidation, one bill, uniform pricing and service because that was what they needed as they experienced their transition from regional chains into national and global chains.

Now Retailers are closing stores at an accelerating rate because they overbuilt in the last two decades. Why did they overbuild? You may as well ask why the sun rises in the east. I think it’s called competition. Or capitalism. Some may call it hubris.

The rise of e-commerce has impacted traditional retailers in a number of ways ranging from the “show rooming” effect to the cost of trying to compete with e-commerce retailers at the game they invented

One of the most important retailers to the newsstand industry, Barnes and Noble continues to generate a significant amount of sales for the business (they are a top 5 retailer for every single title I work with) and maintain the most extensive list of titles in the business. However they continue to close stores even as they experiment with new store formats.

Meanwhile, Amazon not only competes with books and discounted subscriptions online, but they currently have four bricks and mortar stores and plans to open another six. Do you think they’re interested in playing in the current existing distribution structure?

We see other online retailers experimenting with bricks and mortar stores as they realize that a physical presence can extend their brand reach.

What we are seeing in retail, at least as far as I can tell is a reorganizing of how consumers shop and socialize. Just as print and ink is not going away, bricks and mortar is not going to go away either. People are social animals. We like to be out and about.

But we are seeing a restructuring of who will lead the market, what that market will look like. And that clearly will impact the place for magazines in the new order.

In other words, it is no longer enough for circulators to consider all of the steps they need to take to get the magazine onto the rack. We now must consider how we will interact with potential readers and get them to come to the rack for the magazine. We will need to think about how we interact with the retailer to let them know how we are trying to drive traffic into their stores.

That is quite a challenge for an industry that likes silos.

I suppose that in the end this is nothing but a lot of nitpicking. But we now live in a world where the exchange of information is very easy. The fact that newsstand sales are down and still declining is not “fake news” to be angry about. Newsstand sales are down. This a challenging business. But I would asset that we are doing ourselves a disservice by doing nothing but repeating the obvious. There’s a lot more going on here.

Don’t stop with the numbers. Tell us what is working. Tell us what is not working. Tell us what is new and interesting. Talk to the big publishers. Talk to the small publishers.

Six months from now, the numbers will still be down. And circulators who are audited will still be discounting subs and using verified and audited bulk circulation. Because that is what they believe they need to do to stay competitive. Disagree with them? Well, go and ask them why they do it.

So let’s do something different the next time around. I’m busy. I need information. I don’t want obvious.

*Editor’s Note: I used to work for Baird and I happen to like and admire him very much. He’s been warning our industry for years about best circulation practices and it would be very nice if some of our leaders would heed his very rational warnings and observations. It would be even nicer if some of our industry news outlets would talk to publishers who practice what he warns about to get their side of the story.

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4 Replies to “In Which Captain Obvious Drops in for a Visit”

  1. So much agreement with your comments Joe. Consumption patterns are ever-changing. That people (trending younger) subscribe to podcasts is another sign of how different things are today.

    1. Thank you Mark. FWIW, a lot of us “older” folk are big into podcasts too! I’d have to admit that my digital consumption is trending upwards these days. As an example, in the car, I rarely, if ever, touch the radio anymore.

  2. I own a small independent newsstand in Halifax that has been here for 44 years. Needless to say I too see the obvious but try and talk the positive about ink on paper when a customer makes a comment on the state of print. Mind you, we also get the ” it’s just not the same” (reading on a device) and that is said by all ages. I have to say that I am always frustrated by the very deep discounts that publishers offer for subscriptions vs the newsstand. I even received one from the New Yorker at my workplace for me personally! There is no way that I can compete with the pricing (and service) that subscriptions offer. I do wish publishers would not give away their valuable work.

    1. What I do find interesting about the subscription quandry, is that many of my smaller and mid-sized publisher clients don’t give away their subs at such a deep discount – and that is something I’d really like to see explored and discussed by our industry trade news reporters. Most discounts for these publishers are between 10 – 30% off cover and that seems somewhat reasonable to me.

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