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What Ails Publishers Most

Posted on Wednesday, September 15, 2010 at 1:40 PM

What are the top issues facing today's magazine publishers?

By Meredith L. Dias

Over the last few years, you have likely watched many publications, perhaps even some of your own, fold under the pressure of the concurrent publishing industry and economic crises. Where did those publications go wrong? What one fatal error did they all make?

The answer may trouble you: There may not have been one fatal error. As we discovered in a recent STRAT survey we conducted, there are a host of issues facing today's publishers. We asked some publishers to identify their top problems, and their lists ran a fairly wide gamut.

Here are the top ten issues reported to us:

--Advertising sales
--Monetization of content
--Postage issues
--Distribution, printing, and paper
--Social networking
--Staff cuts/issues
--Rate cuts
--Circulation and subscription
--Changing reader trends

In other words, publications have suffered over the last few years for many reasons. Many of the aforementioned issues are, of course, likely related (e.g., staff cuts and economy, advertising sales and rate cuts, etc.). Still, as indicated by our survey results, broad strokes won't paint a clear picture of the recent publishing crisis. So let's examine some of these key issues in a bit more depth.

Monetization of Content

Publishers are having trouble monetizing their content on both the print and digital platforms. Peter H. Miller, president of Restore Media LLC, lists "monetizing digital media" as his number one concern. Conversely, Bill Kinross, VP and group publisher of Meating Place, tells us that his publication is having trouble "proving the value of print when other media platforms offer such detailed metrics and print doesn't."

Perhaps the most acute comment we received was from David Drimer, associate publisher of The Forward: "An irreversible dearth of print advertising forces an accelerated focus on digital operations, and nobody has yet created a viable business model for monetizing the Web that creates as much margin as print did in its heyday."

Publishers still have not discovered a winning formula for online profitability. The surging popularity of e-reading devices and apps has provided some major rejuvenation for downtrodden publishers, but print and digital content are still learning how to coexist in a mutually profitable way.

Going Postal

Postage issues were a common complaint among our print publishers, third only to advertising and monetization issues. David Drimer says, "Postal service is very poor throughout the U.S. for periodical mail, especially on the West Coast, so timely delivery is a challenge." Doug Cooke, publisher and editorial director of JAXFAX Travel Marketing Magazine, cites "continuously escalating postal prices" as a thorn in his publication's side.

It's no secret that the United States Postal Service, dealt a hearty blow by the Web, is suffering. The USPS is currently mulling over the idea of eliminating Saturday delivery altogether. The idea must first go through Congress, but the fact remains that customers are facing planned rate increases and, likely, imminent service cuts. Unfortunately, high-volume customers like magazine publishers bear the brunt. While planned postage rate increases constitute an annoyance for the average customer, "magazine publishers would see an 8 percent price jump, according to the proposals" (according to a Washington Post blog from July). Such a steep rate hike could prove devastating to print magazines already near their breaking point.

Staff Issues

Staff cuts constitute a major concern for many publishers, but not the only one. Tim Robertson, publisher of MyMac, mentions the high turn-over rate of stable writers. Another publisher mentions high corporate expectations. Several publishers highlight the plight of their editors, who are "being stretched too thin as we do more online and through webinars and seminars," says Bill Kinross. Sara Waxman, publisher and editor-in-chief of Dine Magazine, provides a three-item list that sums up the plight of a lot of understaffed publications:

1. Sorry
2. I'm in production right now
3. No time

Peter Miller mentions another problem of particular importance in today's publishing environment: "training old media people on new media." People who have cut their teeth on print magazines must now adapt to an alien frontier, where content is up-to-the-minute and technology changes constantly. A publication's success is now contingent upon the ability to keep current with industry and tech trends. This is difficult to accomplish when staff members who spent comfortable decades in print must first learn the basics, while new media pros surge ahead with new technology and social media solutions.

Rate Cuts

A few publishers identified competitive rate cuts as a major problem. One publisher told us, "Our biggest challenge is competitors that keep cutting rates to get business, destroying the marketplace for years to come. Multiple magazines in our market are slashing rates by 50 percent or more."

This is a prime example of shortsighted publishing strategy. Just as magazines that prematurely eliminate their print editions shoot themselves in the foot, magazines that engage in competitive rate cutting do considerable long-term damage to themselves, their competitors, and their advertisers. Richard Cress, publisher of CSC Publishing, Inc., sums it up with his "Top 3" list:

1. Selling ad space.
2. At full price.
3. While the rest of the publishing world discounts to the point where they lose money on every ad!

No Catch-All Cause, No Catch-All Solution

If only there were catch-alls in the magazine industry equation. If only there were one clear problem and one clear-cut solution. But this is not calculus or grammar. The rules of magazine success aren't so rigid and, for some, this lack of structure can be intimidating. What if you make a strategic gamble and lose? What if you do everything "right" and still lose money? What if you've engaged in several rounds of trial-and-error and seen no results?

Look to other publications for inspiration, but not concrete answers. The strategy that saved one publication could ruin another, and vice-versa. Magazines A and B may share the same strategic problems, but if they serve different audiences and industries, they will require different interventions. Magazines C and D may serve the same industry, but one may have a heavy social media presence, while the other may have a more profitable print edition. There are countless possible scenarios.

Your solution may come after months of strategic meetings. It may come from a magazine consultant. Who knows? It may even come from one of your own staff members, whose revolutionary idea changes the way your publication does business.

Meredith L. Dias is research editor of STRAT and Editors Only.

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