Tolling the Bell for Print? Not So Fast
Read the trades and you get the impression that print titles are dropping like flies. From the recent closure of Jane to CMP chopping three magazine titles and laying off more than 200 employees as part of an online shift;a move that Foliomag.com titled: "Are Techies the Canaries in the Coal Mine?";one would think print is all but over. "We found last year for the first time, our non-print revenues outstripped our print revenues," CMP CEO Steve Weitzner said when he announced the shift, "This year that trend is continuing and the gap is actually growing. We want to realign internal resources around these growth areas and look at opportunities in the marketplace and really go after them."
But while e-media is the future for many publishers, dropping print doesn't address the fundamental problem. Tech publisher BZ Media sees print as 57 percent of its total revenue and its flagship magazine, bi-weekly SD Times, published its largest issue to date in June with a 60-page folio and 34 ad pages. "I see it as an opportunity," says president Ted Bahr. "My competitors are cutting back on sales, on editorial, on the size of their publications."
What CMP's move is really about is bringing margins in line, says Bahr. In CMP parent UBM's March statement, each business division had margins over 25 percent except for CMP, which has margins of 12 percent. Bahr says being privately held has advantages for print. "As a privately-held company, we can invest for the long term and we're not under pressure to improve margins or deliver certain profit levels to investors or owners or public markets," says Bahr. "While print is not as profitable as it was 10 years ago, it still is a profitable business."
Still, the opportunity for print is selective. While SD Times prospers, Bahr says he doesn't see growth potential for BZ's other print title, Software Test & Performance. However, Software Test & Performance does have a series of thriving conferences that Bahr believes are bolstered by the magazine. "Print is a base on which to grow," he says. "A public company might come in and say, ï¾‘Why are we doing this?' and just do the conferences. I think long-term those conferences will be healthier and grow better, if we keep publishing."
Bahr is currently in the planning stages for a major print launch. "A lot of companies are doing minor print launches, which are low frequency and no staff," says Bahr. "But this could be a major launch. We may be hiring 8 to 10 people. Online tends to be very profitable because the expense of the staff executing online is often assigned to print."
Whether as money-maker or brand builder, print is still key for BZ Media. "The industry has to realize that the basic tenets are still there;print didn't stop working," says Bahr. "Does nobody read anymore? A lot of companies will find it more challenging to brand themselves online while in print it's still pretty easy to do."
Hanley Wood's Home Run
One of the biggest recent successes for Hanley Wood (arguably b-to-b's most successful publisher of the last decade) was the 2006 launch of Architect, a print title that is spawning an entire multimedia network, similar to Hanley Wood's flagship magazine Builder.
Architect launched with two issues in 2006, and immediately went monthly in 2007 with a large print and e-media integrated play. "I can't think of too many magazines launched in the last five years that immediately went monthly," says Hanley Wood Business Media president Peter Goldstone.
Hanley Wood is investing millions of dollars in the magazine, from staffing to marketing to acquisitions (including snapping up VNU's Architecture and Architectural Lighting) to hiring design firm Pentagram to work with the magazine. "Our operational pro forma had us losing $2 to $3 million in the first year and we've done so well we're going to break even in 2007," says Goldstone. "The magazine was supposed to do $4 million in its first year, we'll probably do $5 million."
Prior to the launch of Architect, Hanley Wood saw only about 25 percent of its business come from the commercial construction market. Now it sees 35 percent from commercial construction."There are lots of smart CEOs plowing tons of money into the Web;as they should, and as Hanley Wood is too," says Goldstone. "But we're not doing it at the expense of print. Strong viable print properties prop up your Web effort, and strong, viable Web properties prop up your print. Many companies are not as committed to print as they were before, and they're doing so at their peril. If you steal from Peter to pay Paul, you're doing your readers a disservice. We'll invest more than anyone else to make sure the print is a success. Architect has convinced us and our owners;CCMP;to make big bets and do bigger launches, both in print and online."