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Matt Kinsman

Print To Dip Below 50 Percent of B-to-B Revenue for First Time

Matt Kinsman B2B - 04/08/2010-08:53 AM

While b-to-b publishing executives saw print account for 52.4 percent of total revenue in 2009, they anticipate print dropping to 47.5 percent of overall revenue in 2010, according to the latest FOLIO: B-to-B CEO Survey, conducted by Readex Research. That's the first time print has fallen below 50 percent of total revenues for b-to-b publishers as a whole, according to the Folio: surveys.

Meanwhile, paid subscriptions are the only other area b-to-b executives expect to drop in 2010, down from 7.3 of total revenue last year to 6.9 percent this year.

A recent report from American Business Media said print was the hardest hit category for b-to-b publishers in 2009, down 24 percent to $7.5 billion, while events fell 15.8 percent to $11.1 billion. While ABM has reported events have eclipsed print as a revenue stream in recent years, events still lag well behind print for most b-to-b publishers (with the exception of larger companies such as Advanstar), according to the FOLIO: surveys. In the last two years, as publishers have been forced to cancel shows and seek out online alternatives, digital media has eclipsed events as a revenue stream.

How Much of Your Overall Revenue Will Come From These Sources in 2010?

Print advertising        
47.5% (-9.4%)

16.6% (+27.7%)

10.6% (+8.2%)

Custom publishing      
8.8% (+4.8%)

Paid subscriptions                   
6.9% (-5.4%)

Data information sales
2.6% (+18.2%)

7.0% (no change)

Not surprisingly, "staying in business" was cited most often as the respondents' biggest success in 2009, while "the economy" was the biggest disappointment. However, others cited being forced to lay off quality people and the lack of success in finding good salespeople as the biggest disappointments.

For a full look at the 2010 FOLIO: B-to-B CEO Survey-including profitability, operating expenses, tech spending and CEO compensation for 2010, turn to FOLIO:'s May issue, out May 1.

Matt Kinsman

Inc.'s Virtual Office Experiment: Most Editors Say Keep The Office

Matt Kinsman Consumer - 03/30/2010-09:53 AM

In February, the Inc. magazine editorial staff produced its April issue working from home and remote locations like coffee shops and hotels (the non-edit side remained in the office). With rent the second highest expense for most publishers (after people), the virtual office is something more publishers are considering.

Now Inc.’s April issue is hitting newsstands and includes a feature story from senior writer Max Chafkin on the experience, which yielded some surprising results and changed views of both employees who were originally in favor of the virtual office as well as some who were dead set against it. 

The Good

Cost Savings: Located at 7 World Trade Center (one of the few New York magazine offices that actually looks the way Hollywood portrays a New York magazine office), Chafkin estimated a virtual office would save parent Mansueto Ventures $500,000 a year in rent alone. As an aside, it could also save employers on salaries: Anyone considering a job in New York (or anywhere that requires a mass transit commute) must consider the $300-$500 per month in train, parking and other fees, which they build into their asking price. Chafkin does note that the one area where costs could increase is on the legal side, where publishers might have to contend with a wide range of state labor laws.    

Productivity: While some executives may fret about employees goofing off when working remotely, Inc. editors found they actually worked longer hours, eschewing lunch breaks, saving on average an hour each by not commuting and not setting cut-off times to make trains. (As someone whose wife works the occasional Friday at home, I can attest that work-at-home hours don’t include lunch or a 5 p.m. stop.)

Technology: Chafkin cites the technologies that make the virtual office possible for almost any business, such as Skype (an annual phone bill for Mansueto would be about $80 per person with Skype). He also told me about some of the publishing specific tools that made remote magazine production possible, like K4 and Acrobat Pro. “We heard people say we should consider doing [Acrobat Pro] as an ongoing thing,” he says. “This offers a record that’s totally legible. However, the experience of reading pieces of paper is something we’re conditioned to.”

The Bad

Marketplace Perception: Closing the physical office for a virtual one can cast a cloud on the company in the perception of outside observers. Chafkin cited a blog from the Columbia Journalism Review about Inc.’s experiment that said, “If I were a staff member at Inc., I’m not sure I would be approaching this experiment [as] a clever bit of participatory journalism, an innovative cost-cutting measure that could help save the future of the ailing magazine industry, or just be really freaked out when it sounds eerily like what happens when a title in said industry goes to that virtual workplace in the sky and shuts down for good.”

Lack of Employee Interaction: Chafkin noted that magazines in particular benefit from spontaneous hallway decisions and consultations, which are obviously lost in the virtual office.

The Ugly

Work/Life Balance: Several Inc. employees said they had trouble getting family members (especially children) to understand that they were working and shouldn’t be disturbed.

Operating in a Vacuum: Chafkin said that while he was more productive when writing from the virtual office, he felt isolated when not writing. He quotes another Inc. writer as saying, “I felt tied to my computer more than I felt before. I was spending all day in my tiny apartment, not talking to anyone. I felt weird.”
The Verdict: Keep the Office

Ultimately, most Inc. editors say they preferred the office although many said they would be in favor of a hybrid system where they get to work from home occasionally. “Nobody really hated it,” Chafkin told me. “I was more productive but less happy. You spend a big chunk of your life coming into the office and it becomes a source of satisfaction. We could do this in a pinch if we had to produce the magazine remotely. The more difficult thing is if we needed to do this indefinitely.”

Virtual Office Poll
Most publishers have at least a couple employees who work remotely. But what if the virtual office went company-wide? Weigh in here on whether you would be favor of your company going completely virtual.

Matt Kinsman

New Study: Digital Magazines Outperform Other Electronic Media With Ads, Readers

Matt Kinsman Digital Editions - 03/11/2010-09:53 AM

Digital magazines may seem old hat to some but they compare favorably to other electronic media when it comes to advertising and reader experiences, according to a new survey called "The Case of Advertising in Interactive Digital Magazines," by Josh Gordon, founder of Smarter Media Sales.

The survey is based on 5,612 questionnaires taken from subscribers to the following digital magazines: Grand, HipCompass Escapes, HorseLink, Outside Go!, PopSci Genius Guide, Premier Guitar, VIVmag and Winding Road. Nxtbook Media and VIVmag (published by Zinio) sponsored the survey.

Readers Less Likely to Ignore Ads in Digital Editions?
According to the survey, 70 percent of the readers of the digital editions that participated in the study were less likely to ignore display ads in digital editions than on Web sites (30 percent said they were more likely to pay attention to display ads on Web sites).

While Web sites generate more impressions, digital editions tend to promote a longer user experience. Julian Lloyd Evans, managing director of advertising at Dennis Publishing (publisher of online magazine Monkey) told Gordon that on average, interactive magazines are viewed for 20 to 30 minutes while the average Web site visit is eight to nine minutes.

Seventy-one percent of respondents said ads on digital editions were less intrusive than Web sites (where reader action is often very goal-oriented) while 79 percent said ads in digital editions were more credible.

How would you compare your reaction to display ads in digital magazines with banner ads?

Digital magazines
Web sites
Less intrusive:
Easier to read:
More authoritative:
More credible:
Invites involvement:
More trustworthy:
More fun:
More useful info:

The study also found that respondents found ads in digital magazines more helpful than ads in other electronic media. Ads in digital magazines were named the most interesting, followed by TV ads (mobile phone ads were ranked the least interesting).

Which forms of electronic advertising do you find helpful or interesting?

Ads in digital magazines: 63.2%
Television ads: 53.8%
Radio ads: 34.8%
E-mails: 22.4%
Ads in e-mail newsletters: 20.6%
Website banner ads: 16.4%
Website pop-up ads: 2.3%
Ads on mobile phone: 1.9%

Reader Experience
According to the survey, 82 percent of respondents say digital magazines were "more engaging" than Web sites with similar content (compared to 18 percent who chose the web sites). In terms of overall reading experience, readers chose digital magazines over Web sites (Gordon notes that in some areas, digital editions are perceived to offer more content than Web sites even though they typically offer less, and that readers of digital editions are more accepting of digital extras, like video and flash animation).

Digital magazines
Web sites
Has more content:
More authoritative:
More trustworthy:
Easier to read:
Better organized:
More focused experience:
Look forward to it more:
More visually appealing:
More fun to read:

The Role of Digital Extras
When it comes to reading the digital edition, digital "extras" can often spark interest in an article the reader may have otherwise ignored. About one in five respondents said they play the digital extra before moving on to another article, while 28.1 percent said they will read a bit of the article and then play the digital extra before moving on to the next article. Forty-four percent of respondents said digital extras give articles they had no interest in a second chance to be read.

Which of the following "digital extras" have enhanced your reading experience of digital magazines the most?

Videos: 75%
Extra Photos: 58%
Slide shows: 37.4%
Audio: 35.7%
Flash animation: 30.6%

Matt Kinsman

Five Things Your Digital Staff Is Dying To Tell You

Matt Kinsman emedia and Technology - 02/04/2010-06:39 AM

Digital media may have grown from basically zero to 8 to 15 percent of total revenue for most magazine publishers in recent years but the gulf between online staffers and traditional employees (particularly the executive level) remains large.

Below are five verbatims from a mix of e-media strategists, developers, project managers and digital marketers on what they would love for the rest of their colleagues to realize.

1. "Instead of designing a site around editorial or spending days fretting over what color to make a link, actually think about a business model. Too many times we are tasked with a huge design and programming effort only to have someone say, ‘Oh, we'll just sell ads on it.' And then they don't. There's money to be made online, but you actually need a product to sell."

2. "All the higher-ups are publishing people. You need C-level people who understand the technology and what it takes to market a successful web business. When they do hire someone with a digital background, it's almost never someone with any practical development or business experience. They prefer the types that like to sit around all day with overpriced agencies fantasizing about ‘user experience.'"

3. "Trust our advice. We're always happy to explain if you're willing to learn. Publishing people say they want to understand digital, but in practice they are stuck in their old ways, and keep going back to what they know."

4. "Don't launch a Web product without a serious marketing plan to drive traffic. And no, a few e-mails to our existing customer base and two Google ads don't cut it."

5. "I'm not in IT. I'm not here to fix your printer."

Matt Kinsman

Inc. Edit Staff to Try Virtual Office for One Month

Matt Kinsman Consumer - 02/02/2010-12:11 PM

For the month of February, the Inc. magazine editorial staff is going to run an experiment on the virtual workplace with all editors working from home.

According to senior writer Max Chafkin:

"To prepare, we've talked to experts in the field of organizational behavior and entrepreneurs who believe in virtual work, such as WordPress founder Matt Mullenweg and 4-Hour Workweek guru Timothy Ferriss. The reporters and editors have taken surveys on our work habits, downloaded new applications onto our computers and smartphones, and created checklists to help us collaborate even when we won't see each other face to face as we normally do. Most of us will be working from home offices for the month of February. The rest will be scattered among hotels, co-working spaces, and the occasional laptop-friendly café.

As the experiment progresses, we'll be blogging about our experiences here on a regular basis. We also plan to post video interviews with experts and consultants who study virtual work. Then in the April issue of the magazine, we'll publish a definitive piece on virtual work-a look at pros and cons of running a highly-dispersed team (namely, ours), plus, tips on how to work virtually that any start-up or small business can use."

A New Reality For Other Publishers?

While Inc. is experimenting with the virtual office as a way of relaying its experience to its audience of small business owners, it's hard to find any publisher who doesn't have at least a few staffers commuting from the "virtual workplace," whether it's an editor cross-country, a freelance designer or a remote sales rep.

A few years ago, Nielsen Business Media encouraged staffers to work from home and even developed a plan in which each staffer would have a laptop while central docking stations would do away with cubes at the office and allow employees who had to come in for meetings access to the network. Nielsen never went as far as creating the docking stations although recent rumors have emerged that the company has advised the editors of its remaining magazines to start working from home (something a spokesperson denied).

However, as publishing staffs grow smaller while companies are still laboring under multi-year leases that don't look so attractive any more, the results of Inc.'s experiment could have particular significance for the magazine industry. Stay tuned.

Matt Kinsman

iPhone Apps Are Nice, But It’s the 'One-Stop Shop' That Will Benefit Publishers

Matt Kinsman emedia and Technology - 01/14/2010-13:15 PM

Digital publishing vendor Zinio has received much media attention over the last week with its announcement of an iPhone app at the Consumer Electronics Show that’s drawn interest from big name magazines such as Car and Driver, Marie Claire and Yoga Journal (and most recently OK!). But iPhone apps are fairly common among digital magazine vendors. Advanced, Texterity and Nxtbook offer their own versions as well.

But what could pay off big for publishers are digital edition vendors developing services that can tailor content for multiple devices—serving as the middlemen between the publishers creating the content and the emerging devices (mobile apps, e-readers, tablets, etc.) that will ultimately feature it.

As Nxtbook marketing director Marcus Grimm wrote in a recent blog post, “The recently released iPhone/iPod version of the Nxtbook is really a Web app, not a native app available in the App Store. While we will be releasing native apps in the future, we actually felt the web version was more important.”

Here’s why, continued Grimm: “One of the most common concerns publishers have about their digital magazines (or anything else distributed via e-mail) is the erosion of open rates. And while there are many reasons open rates decline, one of the simplest reasons people don’t click on digital magazine links in their email is the belief that the digital magazine can’t open in the device you’re reading it on. This concern gets magnified when you look at how many more people are actually reading their email on mobile devices. Thus, a version of the digital magazine that will open seamlessly when someone clicks on it integrates with a publishers’ distribution strategy, and doesn’t require development or marketing of a separate app.”

Creating a “Unity” Platform

Zinio’s new iPhone app is the first step in its “Unity” reading platform that the company says will optimize for the screen being read, rather than individual device-driven efforts.

“What buyers of content are willing to pay for on an ongoing basis, regardless of how we looked at it—is convenience and connectivity to the content they love,” said Zinio global chief marketing officer Jeanniey Mullen. “There is a whole slew of tablet PCs, smart phones and in mobile, about eight unique operating systems. It made sense to be one point of digital distribution.”

The iPhone app is the Zinio reader. “This enables us on the Unity platform to have content set up in a cloud computing environment,” said Mullen. “A virtual subscription that sits in this cloud would allow you to download content wherever you want or read it online. The fee comes in when the reader buys content through a single issue or subscription. They can buy it once on any device and read it on a multitude of devices.”

That could mean new relevance for digital vendors as partners. "Vendors like Zinio have been in the business for a long time and they're positioning themselves now in a slightly different way to be a one-stop shop to getting on all devices,” said M. Scott Havens, The Atlantic's vice president of digital strategy and operations. “It's an interesting sell because there's now a way small publishers like The Atlantic can deal with all these platforms."

An Enhanced Digital Experience

Early versions of digital editions received some knocks for the static facsimile of the print version. But mobile may transform the digital reading experience. “We’re in the first stage of implementing the app,” said Philippe Guelton, executive vice president and chief operating officer of Hachette Filipacchi Media U.S., of the new Car and Driver iPhone app. “We’ve always believed in digital editions but the challenge has been the user experience. To flip through pages with a mouse and keyboard was not a perfect consumer experience. The turning point is the touch screen, whether in iPhone format or something else. This changes everything.”

Car and Driver currently has a full issue available on the Zinio iPhone app, including advertisements, as well as the ability to share and forward articles. “Gradually we will have new functionality like posting on social media sites, hotlinks for all the web sites mentioned in the issue,” said Guelton. “This is a very positive development and I would expect the same from other players. At the end of the day, we want to reach as many people as possible. We want to be in as many stores as possible and be on as many devices as possible.”

Matt Kinsman

Gender Gap in Publishing Pay is Growing Wider

Matt Kinsman Consumer - 01/07/2010-17:34 PM

While magazine publishing is an industry that tends to have an equal number of men and women employees, it seems as though men often make higher salaries than women across almost every publishing discipline. And the gap widens with more senior titles: entry and some mid-level positions pay almost equal salaries for men and women but with management positions, the difference could be $20,000 or more.

There are many variables that go into salary range, including location (publishing employees in the New York City area earn far more than those in other parts of the country, regardless of gender), seniority (the more years in, the more money you make) and company size (those who work for publishers that make more than $10 million in annual revenue tend to earn more than those who don’t).

And, of course, there are exceptions. Peggy Northrop, editor-in-chief of Reader’s Digest, earns $790,189, compared to Frank Lalli, former editorial director of the now defunct Purpose Driven Life, who made $412,942 according to Reader’s Digest’s bankruptcy filing. In 2008, MPA president Nina Link made $740,713 in total compensation, compared to American Business Media president Gordon Hughes, who received $400,511 in total compensation, according to association filings. Of course, both Northrop and Link are in charge of much larger properties.

However, it’s significant that the closest salary gap across four major publishing disciplines in 2009 was $1,500 and that no position in any publishing category featured women earning a mean salary that was higher than their male counterparts, according to FOLIO:’s 2009 salary surveys.

Gender Gap

On the editorial side, managing and senior editors made about the same salaries (a mean of $66,000 for men, $64,000 for women). But by the time they reach an editorial director/editor-in-chief position, the mean salary for men is $92,100, or 8.7 percent more than the mean salary of $84,700 made by women.

While salespeople start off with a $7,000 gap in mean salaries between men and women, by the time they got to the sales director/publisher position, men took in nearly $21,000 more than their female counterparts ($121,000 versus $120,000).

The emerging position of audience development director and manager showed the widest gap, with males making a mean of $92,100, while females earned $69,300 (a difference of $22,000).

The smallest gap seems to come with art directors, where men received just $1,500 more in mean 2009 salary than their female peers. However, male production mangers made almost $8,000 more, while top male production executives made $15,000 more.

Matt Kinsman

The Dirty Deals Behind Big Scoops

Matt Kinsman Editorial - 12/18/2009-15:10 PM

An article in today’s Wall Street Journal looks at how a story of a Tiger Woods tryst two and a half years ago was spiked by American Media in exchange for a rare level of access to the golfer, who has long carefully manufactured and protected his public image.

Basically, Woods, who has an exclusive deal with Golf Digest to provide editorial content, spurned that arrangement to provide a much more extensive and intimate story to American Media’s Men’s Fitness.

The story (actually, it looks like the New York Post might have had the "exclusive" first) featured a shot of a beaming Woods in a tanktop on the cover and a multi-page feature within. Readers of big consumer magazines have come to expect fawning, sometimes breathless reports on celebrities. Typically, stars don’t agree to make themselves available without pre-conditions. For this one, though, there is an even seamier backstory.

The Journal reported that AMI’s National Enquirer had followed Woods to a liaison, and had photos to prove it, and had told Woods it would publish them. Woods in turn offered access to Men’s Fitness in exchange for the squelching of the National Enquirer story. AMI, the Journal reports, agreed.

I think the public still gives mainstream magazines more credibility than other media. Trade magazines, for example, are considered to be spineless boosters of their markets, and all-too-willing to roll over if it produces an ad. The truth is, big consumer magazines are much more likely to play ball with advertisers—think of home magazines, fashion magazines and all kinds of enthusiast magazines that produce edit-to-order for their advertisers and never let their readers know. As mentioned, think about the celebrity magazines that serve as PR arms of the stars.

And news like this makes it all the more hard not to wonder about the real motivation behind a puff piece, and what the publisher isn’t saying in the story.

Matt Kinsman

New Online Edit Guidelines: Aggregation and Algorithms Trump Original Writing and Reporting?

Matt Kinsman Editorial - 12/03/2009-12:16 PM

Yesterday, Gawker picked up an internal memo from an editor at AOL's to new editors that outlines the company's editorial guidelines, as it attempts to transition to a media company. The approach is broken down into seven steps emphasizing aggregation, generating 300- to 500-word stories riffing off other outlet's stories (sort of, uh, like I'm doing here) and above all, making content search-friendly.

Gawker also noted that AOL recently told the Wall Street Journal it is developing an algorithm to assign stories to freelancers based on Web searches and AOL ISP subscribers.

That follows the path of Demand Media, which uses an algorithm that mines search data, traffic patterns and keyword rates to commission stories/videos based on what online users want to know and how much advertisers will pay for it, largely eliminating editors from the process except for a few who decipher the algorithm results. (Demand also uses its algorithm as way to cut content costs and pay contributors as little as $15 per article, as FOLIO: senior online editor Jason Fell noted recently.)

The AOL memo offers good advice including, "Show, don't tell. Take a statistic and tell us a real human story attached to it. Or why current technical analyses miss the point. Don't just define MBS (mortgage backed securities); find someone who sold them, tell his story, how the instrument evolved, what you think of it, and why we should or shouldn't allow them in their current state-and do it crisply. Appeal to, and link to, relevant facts. You have 300-500 words to make your argument, although going long is not a problem if the copy rocks."

However, the memo also offers four different pitches editors can pick up-however, each option is simply riffing off an existing article from outlets such as The Washington Post and New York Times.

I understand link journalism but a major media outlet that bases its approach almost entirely on riffing off other outlets' stories doesn't seem to be the way to create a loyal and engaged audience. Whether you're an online startup or a traditional publisher, ultimately it's still the quality (and originality) of your content that's going to succeed, not your algorithm.

A full transcript of the AOL memo can be found here.

Matt Kinsman

Advertorials Give New Life to Print

Matt Kinsman Sales and Marketing - 12/01/2009-17:30 PM

Advertorials—the original "paid content"—are no stranger to magazines (FOLIO: does it too. See an example here.) Marketing that looks like content is always attractive to advertisers and as publishers agonize over plummeting print revenue and clients starting to do their own branded Webinars/events/lead gen, advertorials are a way to lure them back and maybe even hit budget for the first time this year.
Reader’s Digest’s Taste of Home recently said it will produce custom editorial columns that are more "synergistic" with advertisers’ promotional goals. Taste of Home created custom in-book sections that feature branded recipe cards for client Jimmy Dean that run next to the magazine’s own recipe cards section. According to RDA’s Taste of Home and Home & Garden Media Group vp and publisher Lora Gier, these sections are clearly marked as advertising and all advertroasial sections are "new pages" that don’t take away from existing editorial pages.
"The conversations we have are very strategic versus just discussing demographics and rates," Gier told FOLIO:. "We are winning exclusive business through these partnerships."
Advertorials Without the "Advertising" Tag
However, other publishers are pushing the boundaries of advertorials. A recent RIA Biz article gave a comprehensive look at a new advertorial program from Worth magazine, which was acquired by Sandow Media in 2008.
Worth charges financial advisors $2,495 per month or about $30,000 per year (the minimum commitment) to receive two-page profiles in six issues, free reprints, magazine subscriptions worth up to $11,000 for the advisor’s clients and a hard cover book with advisor profiles.
The article quotes Worth publisher Patrick Williams as saying, "Fifty-one million of assets under management just for the first issue. People say print media is dead but I have $51 million that says they are wrong." [It’s funny how marketers' complaints about print seem to disappear when they get to control the message.]
However, Worth isn’t labeling profiles as "advertising" but includes a sentence in the preamble of the profile section indicating they are paid for.
I’m all for vendor content and realize publishers (and editors) need to work more closely with advertisers but I don’t agree with advertorials that are anything less than clearly marked.
In 2006, FOLIO: did a cover story on the rise of Schofield Media Group, a publisher which at the time had grown to 10 magazines in the U.K., 14 in the U.S. and $40 million in revenue, thanks to a model that includes selling editorial case studies.
At the time, then Penton Media group publisher Terri Mollison said of Schofield's model, "How can any market derive what key trends or 'hot companies’ are worth reading about when the only criteria to select those companies is which vendors and distributors who are willing to pony up money to have accolades written about them?"
I wonder how many publishers are willing to take that same stand today.

Matt Kinsman

At ABM Forum, Publishers Wonder If Marketers Have Lost Touch With Branding

Matt Kinsman B2B - 11/05/2009-13:40 PM

During the American Business Media Executive Forum in New York yesterday, BusinessWeek chief economist Michael Mandel gave long suffering publishers some hope by saying he believes there is a "media boom" coming in which marketers will reinvest in many of the traditional channels they've cut back.

The ABM Executive Forum was held in place of ABM's usual Chicago-based Top Management Meeting, and drew around 200 attendees. 

Other speakers weren't so sure about Mandel's forecast. "I don't think print will ever come back, it will probably stay at the current level," said Anthea Stratigos, co-founder and CEO of Outsell Inc.

Stratigos also threw cold water on paid content. "Paid content could be more challenged in 2010 than 2009," she added. "Spending by the end-user is decreasing and there is no automatic leverage from ad-based assets to paid content. Media companies come in at the lowest price point."

However, one speaker wondered about the marketer backlash against branding. ‘I'm concerned that marketers have lost touch with branding," said Jeff DeBalko, president and CIO of Reed Business Information. "We can show them research where at least 30 percent of the audience wants to read print in favor of any other medium and marketers don't get it. Direct response used to be the gutter of marketing, now it's the nirvana."

That's not to say Reed is ignoring it. In recent years, lead generation has gone from zero to one-third of Reed's overall online revenue and is a component of 80 percent to 90 percent of Reed's online products, DeBalko added.

Still, DeBalko is worried about advertiser mindset. "We spoke with one agency guy who just talked about how he could cut the budget by 30 percent. A couple years ago advertisers would pay us $1 million for something with a lot of neat features. Now they'll pay one-third of that and everything has to be measured and provide leads. If we as an industry continue to offer the same thing but for 30 percent less, we're out of business."

Matt Kinsman

How One Publisher is Tweaking its Event Strategy and Predicting 10% Growth For 2010

Matt Kinsman B2B - 10/29/2009-12:55 PM

If there is one area suffering almost as much as print, it's events. While trade show revenue dropped 3.5 percent in 2008, it fell a whopping 20.1 percent through the first quarter of 2009, according to American Business Media. Reed Exhibitions (which operates independently of Reed Business Information), saw revenue and adjusted operating profits plunge 22 percent and 26 percent, respectively, in the first half of the year.

Nielsen Business Media vp of business development Eric Biener says events haven't fallen as much as print but when they do, it hurts more. "Even small declines have a huge impact on our infrastructure," he adds.

Hanley Wood enjoyed a record year for its events in 2008 but is experiencing significant declines in 2009 (two long-time executives, exhibitions group president Galen Poss and executive vice president Michael Green, left the company in June). However, it's 2010 that really concerns CEO Frank Anton.

"The real bad news is that the business in 2010 will take further hits in both exhibit space and attendance, and we're budgeting accordingly-almost all of the big shows will suffer double digit declines in revenue and earnings," he adds. "This will be the first time our shows have declined in a meaningful and painful way."

Everything Channel's Five Steps To Growth
Still, one b-to-b publisher saw growth from events in 2009 and is predicting 10 percent growth from events in 2010. "Based on the way people got squeezed this year, marketers are going into 2010 with compromised budgets," says Nancy Hammervik, senior vice president and managing director of Everything Channel Events. "One of the positive outcomes of a challenging market is that it causes you to think smarter. You get as tight as you can while evaluating everything you do."

Here are some of the steps Hammervik is taking:

1. Hosted Buyer/Seller Events: Much of the reason Everything Channel Events is up in 2009 is its hosted model, in which the publisher qualifies a very specific audience and guarantees deliverability by flying out buyers to meet with vendors. "The conferences are smaller but they deliver higher ROI for clients," says Hammervik.

2. Re-evaluating the Life Span of Legacy Events (including the Hosted Model) and Emphasizing Scale: Everything Channel is assessing which legacy events have run their course. "That's something we've never really had to do before," says Hammervik.

That includes scaling back the hosted model in favor of events that can produce larger margins. "The thing about hosted models is they don't scale," she adds. "The bigger they get, the more they cost. The way you grow is to do more-we went from six events to 24. The margin for hosted events is typically half your revenue. At first that sounds great: if you do a $2 million event, you make $1 million. But if you have a $500,000 event, it's $250,000 to just recruit and host."

Everything Channel has had a standalone channel for the Latin American community and did hosted events that put buyers and sellers together in Miami. "It's been five years, it matches the budgets vendors will spend on second or third tier emerging markets, but it requires a lot of energy and resources without offering a lot of return on margin," says Hammervik

Folding four events-two retail XChanges, the Latin America XChange and Project Portfolio & Management-into other events will save Everything Channel almost $4 million in expenses next year, according to Hammervik

3. Launching New Events
Still, Hammervik recognizes that saving on expenses doesn't equal generating revenue. "We all realize that with co-locating events, one plus one plus one will never equal three," Hammervik adds. "Vendors won't spend what they did at an individual event. If we combine XChange Latin America with the U.S. event, it may equal one and a half out of two. We'll lose 50 percent on revenue, but we're saving significantly on expenses."

Everything Channel is rolling out a series of regional events around the emerging category of "cloud computing." "We did something similar five years ago with managed services-people didn't really understand what it was about and we responded with road shows," Hammervik says. "We're rolling out at least six one-day regional events. We're being more cautious about not doing three-day events. That makes it easier for attendees and vendors to manage."

The publisher will also launch a series of events recognizing women executives in high tech, including a "Top 100 Women" channel. The program will include three events for women executives including a three-day conference and two one-day awards shows on the East and West Coasts. Everything Channel will also take a similar approach recognizing the Top 100 CIOs.

4. Custom Events Will Drive Half the Growth Next Year
Hammervik is making an aggressive push into custom event services. "We have been doing that on the side but we're making a significant investment next year in staff and marketing to try to make it a big business," she says. "We think half our growth next year will come from custom event services."

While marketers have increasingly taken on publishing duties for themselves-including events, Webinars, even magazines-Hammervik sees an opportunity for publishers to win that business back. "Vendors themselves have lost headcount and resources. Their core competency is making and selling technology, not doing events."

5. Complementing Live Events With Virtual Events
Many publishers have experimented with virtual events in place of their traditional live event this year (including FOLIO:). Everything Channel sees an opportunity in offering Web services around live events as both a preview and community-builder. "A month before the live event, the virtual event will be active," Hammervik says. "Sponsors can pre-qualify attendees and schedule live meetings with prospects."

Hammervik is looking at charging an additional $5,000-$10,000 to add virtual components to live event sponsorships. "If we have 100 vendors, that will be a significant revenue stream," she says.