The 2014 Magazine Manufacturing and Production Technology Survey
A dramatic spike in new technology investment in 2012 continued in 2013.
Last year's manufacturing and production survey signaled a major turn-around in new technology investment after a four-year decline from 2008 to 2011. According to FOLIO:'s 2014 manufacturing and production technology survey, investment is still on the rise- spiking another 32 percent from 2012 to 2013.
Meanwhile, satisfaction levels with technology are on the rise as well, at least with the b-to-b media market. Consumer publishers are not as happy, in most cases either maintaining satisfaction levels with specific technology types or becoming less satisfied from last year.
About 28 percent of respondents indicated that they publish b-to-b publications. Slightly more, 35 percent, indicated they publish consumer titles, although 7 percent of that total specifically represents mass-market publications. A little more than a quarter of respondents publish association titles. Respondents were allowed to make multiple selections, so the total percent is greater than 100.
Combined revenue is a mix for this survey. Nineteen percent say their companies bring in $10 million or more. The majority, however, are small to mid-market publishers, with 32 percent reporting revenues between $1 million and $9.9 million and 31 percent reporting under $1 million.
The mix of revenues represented here points to a shared investment experience across the various sizes of respondent companies.
PRINT STILL DOMINATES
Print, by far, is still the primary delivery platform for paid content, with a mean of 79.8 percent of respondents identifying themselves as consumer publishers indicating this method. In the b-to-b market, a mean of 84.9 percent of respondents selected this platform.
From there, paid content delivery drops off significantly. Only 12.3 percent of consumer publisher respondents say they offer paid Web content, while 17.5 percent of b-to-b publishers do the same.
The numbers continue to shrink in the tablet and mobile categories, but they do reveal the strategic split between consumer and b-to-b media when it comes to content monetization. Only 2.7 percent of consumer respondents offer paid content on the tablet platform, while 11 percent of b-to-b publishers do so. Smartphones are even less-only 1.5 percent of consumer publishers and 3.7 percent of b-to-b publishers indicate this is a paid content platform. These numbers have not changed much since the previous year's survey.
Respondent job types, as they typically have over the years, break down largely between art/design and production. Although this year, we saw a significant increase in respondents who also do e-media and web development work.
Companies, at least within our respondent pool, predominantly keep production and design work in-house. About 72 percent of consumer respondents say they use in-house resources, while 91.5 percent of b-to-b respondents say the same. Outsourcing, which includes agency, design/production firms, printer services and so on, has grown among consumer publishers. In last year's survey, 13 percent said they outsourced services. This year, close to 29 percent do so. The in-house/outsource numbers for b-to-b publishers have held steady.
Of those in-house resources used, most are applied to the design and production of print products. In very similar numbers to last year's survey, consumer and b-to-b respondents say that 76 percent and 65 percent of resources are applied to print, respectively. Although, close to 30 percent of b-to-b publishers have combined their resources for both print and apps.
Once again, smartphone production resources are very small with only 7 percent of in-house resources dedicated to smartphone content on the consumer side and 3 percent on the b-to-b side.
How final files end up at the printer are largely divided between a supplier's proprietary uploading system and an FTP site. Forty-five percent of b-to-b publishers indicate the use of a proprietary platform, such as InSite, while 38 percent utilize an FTP site (these numbers are close to the 2013 survey). Consumer publishers show a similar breakdown, with 60 percent reporting use of an FTP site and 26 percent using a proprietary platform. From there, numbers drop significantly, with about 5 percent of consumer publishers delivering files through a cloud service and a tiny percentage still using email attachments. Six percent of consumer publishers also still utilize physical media of some kind, whether DVD, CD or a flash drive. B-to-b publishers, on the other hand, have almost uniformly moved to the proprietary or FTP methods, with barely reportable numbers indicating these other avenues.
SPECIFIC PRODUCTION TECHNOLOGIES
This year, the numbers broke down quite differently between b-to-b and consumer publishers for XML and online insertion order technologies. Twenty-nine percent of b-to-b publishers utilize XML, while only 19 percent of consumer publishers do. And 42 percent of b-to-b publishers use online insertion orders while 15 percent of consumer publishers do. In 2013, XML technology was much more closely aligned between the two markets.
XML ON THE RISE
Publishing in XML has grown since last 0% year for b-to-b publishers, rising from 21 percent of respondents to 29 percent. Consumer metrics dropped slightly, however, dipping 5 points to 19 percent. While that gap was closer in the 2013 survey, this year's numbers are more in line with 2012's report.
XML is an area where we'll potentially see continued growth. Larger publishers are already overhauling their content production systems to enable more efficient cross-platform publishing, a key strategy now that mobile and tablet publishing are a major focus in the content mix.
Going forward, any growth in the XML publishing category will continue to be centered on the larger publisher market. In this year's survey, 54 percent of the publishers who publish in XML are also in the $10 million and up revenue category. Conversely, 78 percent of publishers who don't use XML are in the under $1 million revenue category.
Ad portal systems are used by about one-third of consumer publishers and slightly more for b-to-b. This ratio has flipped this year, with b-to-b publishers jumping from 26 percent last year. The same can be said of online insertion order systems, the gap between consumer and b-to-b publishers is even wider, with the growth coming on the b-to-b side. JDF usage continues to be minimal.
PRODUCTION TECHNOLOGY INVESTMENT
The investment picture changed in 2013 and the upward trend has continued with this year's report. We asked our survey recipients to indicate how much their technology investment changed in full-year 2013 compared to the previous year. While the majority of respondents across both b-to-b and consumer markets have indicated "no change" in their investment patterns in both production personnel and technology the percentages of those who are investing has been increasing since 2010. The only difference is for this year's report, b-to-b publishers have outpaced their consumer counterparts in spending. This year, 38 percent of b-to-b publishers said they increased spending and 19 percent of consumer publishers said the same. Last year, those numbers were much closer together.
Of the publishers who do plan to increase their investment in production personnel and tech, about 12 percent of publishers plan to increase spending by 10 to 29 percent. That metric was at about 17 percent in 2013's report.
NEW TECH SPENDING CONTINUES TO RISE
Spending on new technology spiked suddenly in 2012, reversing a 4-year downward trend. Spending continued to rise significantly in 2013, jumping 32 percent between 2012 and 2013. These aren't big numbers, but after such a long decline, the trend is promising. After bottoming out at about a mean value of $22,000 in 2011, full-year 2012 spending more than doubled to a mean of $47,000 and then jumped again to $62,000 in 2013.
It appears that respondents are gradually warming up to new technology-this comfort level is perhaps what's behind the decision to invest more money.
Understandably, print tech satisfaction levels are very high. Publishers are clearly well entrenched in producing their central product platform. Virtual proofing, website production, content management platforms and mobile app layout production technology round out the top five categories by respondent satisfaction levels. Again, there is some correlation here between usage and satisfaction. JDF files are at the bottom of the list, for example.
B-TO-B HAPPIER WITH TECH
Like last year's report, B-to-b publishers are largely more satisfied with production technology than their consumer counterparts. Unlike last year though, the margins have expanded. Virtual proofing, for example was separated by only three points in the 2013 survey, and website production had a four percent differential. Even so, b-to-b publisher satisfaction levels have grown significantly.
And those levels, at least this year, are in line with spending. Looking back at the change in technology investment, it's the b-to-b publishers who are reporting more investment this year. Digging deeper into the data, 38 percent of trade publishers increased investment in 2013 versus 19 percent of consumer respondents.
Broken down by revenue, larger market publishers tend to be more satisfied across the various technology groups, perhaps due to their ability to invest. But that's speculative. New technology never performs as expected.
In the "dissatisfied" category, respondents tended to group their concerns around the CMS, web and mobile technologies. Consumer publishers have become less satisfied with their CMS tech, almost doubling from 10 percent in last year's report to 19 percent this year.
The survey sample of 1,000 for the mail survey was selected in systematic fashion by FOLIO: publisher Access Intelligence and Readex Research from 1,847 FOLIO: recipients who indicated on FOLIO:'s subscriber form they are within one of the following functions at their companies:
- art/creative/design management
- Web/electronic-media management
- production/manufacturing/distribution management
For the online survey, all those who were already selected for the mail survey bud did not respond were re-surveyed and the 588 who had not been sampled for the mail survey and did not receive this same survey last year were also included. A total of 1,588 individuals were included in the survey sample.
Both surveys were closed for tabulation on July 9, 2014, with a total of 87 responses-a 5 percent response rate. To ensure representation of the audience of interest, results have been filtered to include only the 73 respondents whose organizations publish magazines.
The margin of error for percentages based on 73 usable responses is Â±11.2 percentage points at the 95 percent confidence level. The margin of error for percentages based on smaller sample sizes will be larger.