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When Will the Newsstand Canary Croak?

Replica circ is yet another contributing factor to single copy sales woes.


Baird Davis By Baird Davis
02/14/2013 -14:33 PM






 

For the last five years publishers have been digging ever deeper in the newsstand coal mine, seemingly blind to the dangers that lie below. The canary hasn’t croaked, but it’s clearly breathing harder.

Publishers, naively waiting for good news from the top of the mineshaft, keep bemoaning the reasons for this calamitous bit of bad sales luck.

The recent newsstand sales figures for the second half of last year from AAM were indeed grim. It has been reported that the decline in unit sales was 8.2 percent from the year previous. But a more measured review, one that includes the sales of titles that reported sales a year ago but are no longer being published, shows that performance was measurably worse.

See Also: AAM: Newsstand a Drag On Circ as Digital Rises

It reveals that unit sales were down 9.3 percent and revenue off 8.2 percent. But even these numbers don’t fully demonstrate the level of performance.

Because of a reporting date anomaly nearly all the weekly frequency publications reported sales for 27 issues. However, they are being compared to 26 issues from the previous period. If the extra issue for the top 11 weekly publications is excluded from the calculations the unit sales decline would have been 10.2 percent. This, perhaps, represents a truer picture of newsstand sales performance in the second half of last year.

 


[Click image for larger version.]

 

Well, as they say, stuff happens. If that were only the case an isolated ten percent decline wouldn’t be so worrisome. But let’s not forget this performance closely mirrors what has been happening on the newsstand for the last five years:

Unit Sales: Down 44.9 percent, 11.2 percent annually
Revenue: Down 38.0 percent, 9.1 percent annually
Total Paid Circ: Down 14.9 percent from 277.6 to 236.1 million
Single Copy Circ: Down 44.7 percent from 48.8 million to 27.0 million
Single Copy Circ as a Percent of Total Circ: Down from 17.7 to 11.8 percent

Has it ever been clearer that the newsstand canary is in extreme danger of croaking?

What’s my point in stretching this analogy? I believe publishers, to some great extent, remain in denial concerning the depth and seriousness of this precipitous decline. Let’s be realistic here. In the last five years there has been a sea change in technology and how people consume media. As New York Times columnist Thomas Friedman indicated, in speaking about all businesses, 9/11 and the Great Recession have disguised the effect of these changes.

The business of magazine publishing is being seriously altered. Management emphasis has shifted to cope with the changes of an increasingly digital world. One manifestation of these changes is the rapid ascendency of replica circ. Its use nearly tripled in the last year—from 2.8 million circ to about 7.6 million circ, an increase of about 4.8 million. This increase, interestingly enough, compares pretty closely to the 3.6 million decrease in newsstand circ for the same period. It’s now a good bet that replica circ is cannibalizing newsstand sales.

Nothing can be done to halt the advance of these technological and consumer involvement changes to the magazine business. But what publishers can do, if they really want to preserve the newsstand channel, is to concentrate their efforts on cooperatively working with its wholesaling and retailing partners to fix the inherent inefficiencies of channel operations.

But time is of the essence. The canary’s breath is running short.

 

Baird Davis is a senior consultant with Circulation Specialists.





Baird Davis By Baird Davis -- Baird Davis is a senior consultant with Circulation Specialists.

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