In Which I Disappoint (Maybe), the Mysterious Mr. Tree

Permanent musical accompaniment for this post:

Who is the mysterious D. Eadward Tree, the prognosticator and pundit of the lively and insightful Dead Tree Edition blog? There is some speculation about that in certain circles of the magazine industry. Maybe Mr. Magazine knows. Perhaps Bo Sacks knows. The team at Publishing Executive might know but they’re not talking.

The interesting thing about the Dead Tree Edition blog is that Mr. Tree’s anonymity lets him step outside his career path for a moment and speak openly about the issues impacting the magazine business. Honestly, I’ve learned more about the US Postal Service than I ever thought I wanted to. But I’m very glad I read his blog!

Last week, Mr. Tree published a piece, In Defense of Giving Away Free Magazines on the Publishing Executive website. The piece is interesting and I encourage you to read it.

In his piece, Tree announces that he has found what he thinks may be the lowest priced subscription offer to date, a $1.00 per year subscription to Entrepreneur Magazine. Yep, that’s right. $1.00 for a years’ worth of magazines.

Tree presumes that according to the rules of magazine punditry, “I’m now supposed to launch into a rant about how such bargain-basement offers undercut newsstand sales and reflect overinflated ratebases.”

Well, yes, you could go that way. For the record, bargain basement subscription offers do seem to undercut newsstand sales. The good folks at MagNet have some interesting data on that. Do they reflect overinflated ratebases? Maybe. And maybe not. Personally I hate to see low priced subs. However unless I actually worked on the team that put the prices into effect, I’d have to admit that I don’t know why the publisher is doing this. So when we criticize publishers for taking this path, what we’re really doing is spitballing.

Source - University of KY
Pundits hard at work! Source: University of Kentucky

Tree acknowledges that the Entrepreneur team may have a strategy where the $1.00 sub price makes a lot of sense. The way I look at it, if you have a lot of other income buckets, a low priced sub might get people in the door and encourage them spend more money elsewhere more efficiently. It’s a good strategy if it works.

Tree then suggests, “Why not give the copies away?”

Indeed. Why not?

Frankly, free is a great circulation model for many consumer titles. Free city, state and regional publications are a staple in many coffee shops, dry cleaners, hotels and even in supermarkets. I’d point you in the direction of the Where Traveler Magazines published by the Morris Media Network as an example of a very successful line of free consumer publications.

18881959_10155326042889120_6886036106399145609_n
Free!

Free circ can save your bacon. Two years ago I launched an art magazine onto the newsstand. We were well funded, well edited. The publication was beautiful. I put together, if I may toot my own horn, a really good newsstand program focusing on chain and independent bookstores, regional distribution in areas where the publisher knew their audience would be. The launch model numbers worked. The launch issue was gorgeous.

The sales were terrible. Embarassingly bad. No matter how hard we tweaked things, the sales were not there.

The magazine is now free. It is a free insert in several local newspapers in targeted markets. The title is thriving. Free can work.

I can’t continue on this train of thought without pointing out that much of the B2B publishing market consists of entirely free print and digital circulation magazines.

So I’m not entirely sure why Mr. Tree thinks publishing pundits will come after him. For sport maybe?

I don’t like low priced subs because they can impact newsstand sales negatively and newsstand is where my history comes from. I don’t like seeing my history (Or my people) trampled on.

While it may be personal to me, publishers have gone this way for a reason and what’s personal for them is the survival of their magazine. Not just a piece of a larger business. The trade journals focus on the big publishers and retailers because they drive the business. The stats that get breathlessly repeated are their stats.

But many smaller publishers are doing just fine and making a profit. They don’t devalue their subs and they invest in all of the things that the big publishers invest in. Their newsstand numbers are solid and reflect what’s happening in their niche.

To repeat: Plenty of consumer publishers already have free distribution and they’re doing just fine.

The energy drink, Red Bull, publishes a magazine called The Red Bulletin. For many years I got it for free. They never asked me to pay for a subscription. They do sell the title on the newsstand, but my guess is that is more for visibility purposes and to show off to some advertisers**. Here in the states, they print and distribute more than 500,000 copies. That sounds successful to me.

Unknown
High energy and free!

So, Tree. Sorry. I don’t think what you’re suggesting is all that far off base. Some publishers will opt for free. Some publishers will continue with paid. Some publishers will mix and match and that may work. Or that may not work. My clients have a wide variety of models with varying degrees of success.

And I really hope no one comes after you. It’s summer and it’s too hot for fighting. How about some lemonade instead?

**: See? I’m spitballing there. “Pundit” at work.

Advertisements

Put This One in the “WTF” File!

Back in the day, back when there were more than 300 magazine wholesalers and eight or nine national distributors, the coveted jobs were often the ones where you worked directly for a magazine publisher. The big publishers: General Media, Playboy, Conde Nast, Ziff-Davis, all had people out in the field. According to an old “Bunny Book”* from 1990 that I found in a recent sweep of my office, Playboy Magazine had at least eleven people working in the newsstand department: Five people in the field, one in marketing, and another five in the corporate offices.

If you were a national distributor rep toiling away for Curtis, Kable, Select or ICD, a job with one of those publishers was a ticket to more pay, travel and career success.

Even smaller publishers often had people out in the field. I worked for Outside Magazine, a single title publisher and we were a department of two. When I wasn’t working on specialty sales I was sent out once a month into the countryside where I would call on upwards of five or more magazine wholesalers in the course of a week. I recall a US News and World Report representative joking that he worked for two magazines: “US News is one. World Report is the other,” he quipped. I guess you could call that rep room humor.

Which brings us to the unexpected news from late Thursday afternoon: Harris Publications is closing it’s doors. This forty year old publisher may be one of those companies where you might have recognized the title, but never realized how many titles the publisher actually produced. Harris published upwards of 75 different magazines running the gamut from The Harris Farmer’s Almanac to Celebrity Hairstyles, Who’s Who in Baseball, Survivors Edge, Naturally Danny Seo and Dog News. If a trend got hot on the newsstand, Harris wasn’t far behind with a new title launch.

In fact, I had a running joke with myself whenever I came across a new magazine on the newsstand that I didn’t recognize: I’d pluck if off the rack and before I turned to the staff box to see who the publisher was (and if they had a consultant), I’d say, “I bet this is a Harris special!” I was often right.

Back when there were more wholesalers and distributors and field people, I frequently ran into Harris reps. Aside from being really great people, I was always impressed with how much they knew about the wholesaler system and the retailers that were serviced. They knew which buttons to push, which retail buyers were open to new titles, how strict certain distribution managers were with authorized lists, who the best route supervisors were and which general mangers you wanted to stay as far away from as possible.

So is it surprising to see that Harris is going to “wind down” it’s operations? Well, initially I’d say yes.

In fact, the headline for this post is exactly what I said. “WTF?”

But on reflection, maybe it wasn’t that surprising.

It seems to me that Harris was always something of a “newsstand first” type publisher. While that may not be impossible to do even in today’s market, it is certainly a risky way to run your publications in the first year of “Off Invoice RDA” and POS sales reporting. In 21st century publishing you need a lot of revenue buckets to make things work. I could be wrong, but Harris titles never seemed big on subscriptions or advertising and I wonder how big their digital efforts really were. In a letter to industry partners, Stanley Harris acknowledged the changes in the publishing industry and then said,

“We have tried mightily to persevere against these forces, but have been unable to overcome these challenges.”

So perhaps the management at Harris felt it better to fight how the industry was changing rather than hop on and try to wide the waves?

Most people don’t really like change. I can understand that. One of the things that I find interesting about the newsstand industry is that it is constantly changing. When I entered it in the early 1980’s there were some long time employees in some of the rep rooms I worked in who lamented that things hadn’t been good in the business since the 1970’s when “They started hiring all those women and bringing in those computers.” Now those gentlemen were real dinosaurs. Nice guys, often, but dinosaurs.

The loss of Harris is a blow to this business. We need the numbers and revenue from those titles. We need them on the checkouts and mainlines. We need them in feature pockets and flex pockets. Harris’ distributor is certainly going to feel pressure from this closure and that is not a good thing. Hopefully the better titles can be salvaged and made competitive for today’s market and their employees can find new homes and continue to work in magazine media.

In the meantime, I’ll stay on the foredeck and wax my surfboard.

I'd rather be here...

 

*: The Playboy Bunny Book was the official listing of all “Playboy Approved” magazine wholesalers in the US and Canada. It was a coveted possession because it had the address and phone number for all of these wholesalers. As an added bonus, it had phone numbers for the wholesaler sponsored “Rep Rooms.” How else could you reach your traveling companions in the days before cell phones? For those reps who were looking for new employment, it also included listings of all the national distributors and their key personnel and phone numbers. In the early 2000’s Playboy ceased publishing this directory.

Bunny Book 1990
A scan of the cover of the 1990 Playboy “Bunny Book”

 

Join, Or Die

Editor’s Note: Over the holiday break, I spent a few millennia sitting on a plane reading articles about the Tea Party and looking at photos of some of their paraphernalia. While you don’t want my opinion about the current state of their union, the images they used, especially the “Join, Or Die” flag, got me contemplating Walter Issacson’s excellent biography, “Benjamin Franklin-An American Life”. Somehow, that led me to this image which  I offer  to you readers.

Illustration by ELB
Illustration by E. Berger

There are enough writers now who scoff at the notion of print magazines going the way of the dinosaur that we can drop the whole “going the way of the dinosaur” or “buggy whip” analogy.  In any event, while there are no dinosaurs around these days, they are a pretty big business. And, while there aren’t too many horse drawn carriages rolling around major American cities, there are still buggy whip manufacturers.

The current state of the newsstand distribution business is an altogether different nest of dinosaur eggs.

In theory, the consolidation of the newsstand distribution business should have been a good thing for everyone. For publishers, piecing together a print order became much simpler because there are fewer wholesalers of wildly varying sizes and fewer people with wildly different agendas to negotiate with.

For wholesalers, the elimination of some nearby competitors and the consolidation of their presence in key regions should have made life easier. It also provided a chance to create firmer relationships with major national retailers. There was the possibility of breaking into new national markets.

Retailers were finally able to consolidate their service levels, streamline their invoicing and payments and bring magazine distribution up to levels comparable to their other DSD delivery agents.

Some of that happened and whether or not any of it is a good thing most likely depends on which side of the table you sit on. Are you a glass half full or half empty kind of person?

What more than fifteen years of consolidation has not done is streamlined how we measure success in our business. All the links in our distribution chain look at it differently.

For an SBT retailer, a 35% sell through should be meaningless because they only paid for what they sold and they never carried the other 65% on their books (Although the savvier ones should wonder what could have sold in the space where those returns came from).

For a publisher, a 35% sell through can mean a profit if their production costs were not too high. It can also be a break even point. Or it can be a loss. It all depends on those pesky printing and shipping costs. Plus whatever else the wholesalers, retailers and national distributors tack onto the final bill. Those add ons can add up.

For a national distributor, selling a magazine at 35% is pretty much the same as a national distributor that sells it at 55% or 15%. For them, the only difference in many cases (Unless the contract is creative and has efficiency tied in) is the volume of sales. A publisher client with a 15% sell through is either on the way out of business, or about to get a lot of hand holding if they still have a stack of cash and the will to fix what is wrong. Hand holding a publisher can be expensive. On the other hand, a lot of hand holding for a +50% client at least means there’s money coming in, and the potential for more.

But in the end, what about the reader? After all, our goal here, in this little brackish, increasingly shallow tidal pool of the publishing industry is to sell as many copies of as many magazines as possible. Isn’t it?

Is the solution to meld the national distributors (ND’s) and wholesalers together? I’ve heard this idea kicked around. Ideally the goal of  the ND’s is to market and advocate for the publishers to the wholesaling and retailing community. If ND’s are not there, who advocates for the publisher? Wholesalers should be invested in the success of the products they market but it often seems as though it’s simpler for them to push a button and say “No” than to dig in and try to understand what is presented to them. To be fair, many on the publishing side still don’t really understand what is involved in wholesaling magazines.

And distributing magazines to the newsstand, in spite of all of the technological advances we’ve seen over the last twenty years is still very labor intensive. We don’t see as much local knowledge of the stores and markets serviced as we should expect.

There’s no denying that readers have not been picking up newsstand copies in the quantities that they used to. Sales have been declining for many years. We’ve seen some positive trends like the successful launches of HGTV Magazine and Food Network Magazine. There’s great news on the specialty front as Book A Zines and specials bring in high cover prices and high sales. Mr. Magazine ™, Samir Husni counted 242 regular frequency magazine launches in 2012.

At the same time, we have seen the declines in traditionally strong categories as well as the near elimination of some categories that were traditionally industry leaders in the last two decades. These declines wipe out the gains that have been hard won.

Maybe we’ve lost our way. In all of our obsessing over consolidating, efficiency, will we or won’t we survive, we’ve forgotten that this is a hand sell, one at a time, get the people into the stores kind of business. There don’t seem to be any short cuts to achieve that end. There are a lot of great tools these days that should make our job more efficient. But we still have to get readers to find the rack, stop in front of the rack,  pick up a magazine and then make the decision to buy the magazine. We know people like magazines, we just have to get them to buy them.

The Backwoodsman Magazine: A Tale of Single Copy Success

Editor’s Note: An earlier draft of this post incorrectly stated that the single copy sales of The Backswoodsman had climbed from below 40,000 copies to 150,000 copies. The post should have stated that the distribution of the magazine had climbed from below 40,000 copies to 150,000 copies. That has been corrected below. My apologies for the error.

If you’re deep into mainstream New York based slick glossy magazines, there’s not much for you here in The Backwoodsman Magazine. That is, unless you happen to have a life that’s lived in the outdoors. Perhaps you wish to live off the grid, be self sufficient and you want to know how to build a “Zeer Pot Refrigerator”. Or maybe you need to replace the gunwales on your canoe and you think you need to take a refresher course in winter driving.

This thirty-two year old magazine is ably owned and edited by the Richie family of Texas. Compared to the latest Conde glossy, it is anything but cutting edge. In fact until six months ago, the insides of this title were printed on newsprint. The cover images are taken from outdoors art. They feature hunters, fishermen, trappers, Native Americans and scenes from the Old West. While the website is functional, the content is limited. However the e-commerce store is well stocked and easy to use. There are no apps. There is no digital subscription.

The Jan/Feb 2012 Cover of “The Backwoodsman” It’s more mainstream than you think.

Most of the articles we see about print magazine circulation are about how sales are down on the newsstand and sub sides. Print is dead. No one wants to shop at bricks and mortar retail. The only place where most writers (and frankly most of the numbers) will grudgingly concede some sort of growth is in the Book-A-Zine category (aka the Zombies).

But here’s a contradiction to that trend. Seven years ago, this magazine, The Backwoodsman, was distributing less than 40,000 copies onto the newsstand. Nothing very big. The only  saving grace for the title was it’s sell through in the mid forties. It was a candidate for the slow erosion and decline on the newsstand that we’ve seen for many other independently owned, middle of the pack publishers suffer through.

But the exact opposite has happened to this title. This magazine has seen it’s newsstand distribution slowly climb from that sub 40,000 mark to 150,000 copies. All the while, it’s single copy sales efficiency has averaged 45% or better. Sales are up significantly.

How did that happen?

One answer is that the content in this magazine is something that people want. More and more people do want to be outdoors. Either read about it vicariously, or actually live self sufficiently. Many of the articles are written by the readers and it’s easy to see how intimate the magazine is with it’s audience.

However in today’s newsstand world, a hot topic is not necessarily a recipe for growth. It also takes persistance.

Newsstand circulation is handled by Irwin Krimke, a consultant and veteran of the Kable News book division and former national distributor ADS Publishing Services. When he began working with the title, about a quarter of the wholesale marketplace was not drawing the magazine and the former Anderson News had placed it on a highly restricted distribution.

It’s very possible to look at much of today’s newsstand business and think of it like many other “push button” businesses. Communication is mostly through email. People hide behind voice mail walls. Distributions are worked through MagNet or a national distributor’s equivalent and submitted electronically. For most main stream titles, the ID wholesale market may be less than 5% of your overall sales.

In this case, Irwin has steadily worked the the title’s distribution and pushed it’s national distributor, Kable Media to go after increasingly important chain authorizations. It took a long time, many submissions, and the retailers are now responding. Krimke works the wholesalers personally and has expanded the ID market. Retailers and wholesalers are paying attention to this $4.95 publication.

Two simple lessons come to mind when considering this story:

  • Good content needs good editing. We hear the words “content” and “curation” tossed around like so many pennies these days. This publisher shows us that you need to know your readers, deliver articles they want to read in a format that the readers want to read them in. In this case ink on paper seems to do just fine. For others it will be digital. Figure it out. Deliver it.
  • Work your circulation. Know your circulation. Don’t ignore your circulation. It doesn’t matter if it’s print or digital. It doesn’t matter if it’s in house or outsourced. Rule #2 in magazine survival is: “If you don’t understand your circulation, you will perish.”

This publisher has his finger on the pulse of his readers. He’s delivering words they want to read and his audience has responded by growing. He has people on staff who pay attention to the circulation and he listens to them. You can grow on the newsstand. You just need to understand it, work it, follow-up on it, and keep working it.

In my first real publishing job many years ago at Outside Magazine, the subscription director, Anne Mollo-Christensen, lead off a staff meeting once by describing her responsibilities like this: “We test,” she said, “Then we measure, test again, measure, try something new, measure, and test again. We’re always looking for a new way to get to a reader. We never stop trying.”

That was perhaps the best lesson I ever had in circulation and marketing. The Backwoodsman lives it every day.

Anybody else out there have a circulation success story they want to share?

The World’s Worst Direct Mail Piece?

This showed up in the mailbox yesterday. Yes, mail still shows up in our mailbox. At least 50% of it is unwanted in that “we didn’t ask for this to be sent to us and it does not interest us” kind of way. The rest of the mail still serves some purpose: magazine subscriptions, bills that we still pay the old school way, greeting cards and the like. But at least 50% of our mail is unsolicited direct mail and probably 50% of that goes unopened into recycling bin.

The rest does get opened. Usually because there is something interesting about it and as our business relies in part on advertising and direct mail, well, it pays to see what the cleverer kids are up to.

But this piece is remarkable! I think that really could be a terrible off the shelf, Microsoft Office style fake corporate logo. There is a “US Airways”, of course. But if you Google “US Airlines”, you’ll get sent to a cheap tickets spot that does not appear to be related to these guys. And the come on! I “qualified” for two roundtrip airline tickets? Really? How?

It’s so cheesy, I’m tempted to call and tell them they’ve won something!

So bad it's good.

It’s either sheer genius or exactly what it looks like.

In our modern web connected world, we take email spam for granted. We all page through our in boxes each morning and chuckle at the “Urgent Appeals” from Nigerian businessmen and hit the delete button. We have people selling gold and watches and “coupons” to stores that we never shop in. I still get several viagra “deals” from Canada each week.

You have to presume that like all direct mail, or even magazine circulation, there’s a certain “break even” level that makes it worthwhile to keep doing what you do. So what is the “break even” percentage on all that spam?

This “spamy” type of unsolicited direct mail must be the same way. But the costs have to be higher than a bulk spam mailing. The paper, the postage (this had an envelope with a stamp on it. The envelope appeared hand addressed (which would have been even more brilliant), but closer inspection proved it was some sort of auto pen. The signature on the letter was the same. So this wasn’t entirely cheap. But this operation clearly needed someone to run the list, print the mailing, and man the “800” number.

I recall getting similar come ons from “travel” operations back in the last two decades. But those were pretty elaborate mailings. There were colorful folders, “ticket holders”, even fake tickets. Maybe in this stark new age of austerity, this is the best these operators can do. Plain white envelopes, blue ink auto pens, text that sounds like the person who wrote it was tired and didn’t believe their own sales pitch.

For whatever reason, I must be on someone’s list and someone must think I want to travel badly.

I don’t. At least not where they would send me.