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Michael Rondon

Folio: Taking Content-Creation Summit Series on the Road

Michael Rondon B2B - 09/11/2012-15:50 PM

 

FOLIO: unveiled a one-day, nuts-and-bolts training workshop this week focused on presenting essential new skills for content creation and deployment. The workshop will be conducted three times in 2012—in Los Angeles (October 10), New York (November 14) and San Francisco (December 4).

Called C2, the workshop is built on more than 70 case studies and best practices from around the media industry. FOLIO: general manager Tony Silber and editor Bill Mickey will host the event.

“There’s never been a more exciting time to be in media,” Silber said. “There are new channels, new formats, new expectations and new opportunities. The basic relationship between content creators and content consumers has evolved.”

The workshop's core curriculum is an analysis of case studies that show how media companies are leveraging social, cross-platform tactics, video and much more to build content creation strategies that address today's reader behavior. Learn what’s on the minds of the innovators in consumer, b-to-b, association media, city and regional, and hear what’s right around the corner.

To register and to learn more, click here.

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TJ Raphael

Cosmo’s Chance With Joanna Coles

TJ Raphael - 09/06/2012-14:39 PM

 

Hearst Magazine’s resident PR guru, Jessica Kleiman, hit the nail on the head when prepping newly appointed Cosmopolitan editor-in-chief Joanna Coles for an upcoming interview (see video below), asking the question on the minds of several media reporters:

“Given the direction you took Marie Claire, do you have plans to make Cosmo more sophisticated?”

This could be a seminal moment for Hearst Magazines, Cosmopolitan and Coles herself. The title has been slammed recently by Victoria Hearst, the granddaughter of Hearst Corp. founder William Randolph Hearst. According to a press statement released in June, Ms. Hearst partnered with ProjectInspired.com founder Nicole Weider in an “Anti-Cosmo Mission.”

“About 11 years ago, I contacted Frank Bennack and the Board of the Hearst Corporation and told them that what they are publishing in Cosmopolitan magazine was pornographic. I had the support of two female psychologists and counselors who attest that this content hurts young girls. Like Nicole (Weider), I also asked that the magazine be sold only to adults 18 and older,” said Ms. Hearst in the June statement. “When I heard about Nicole’s campaign, I knew I needed to join in her mission to put Cosmopolitan in a bag and make sure that its pornographic content cannot be sold to minors!”

SEE ALSO: Post-Photoshop Crisis, Hearst Receives Shrink Wrap Demand

You would be hard pressed to find any issue of Cosmopolitan from recent memory whose content didn’t prominently center on sex. Cosmopolitan is so synonymous with sexual content that when reporting on the new Fifty Shades of Grey Magazine (which is based on erotic literature), the Huffington Post’s Julie Gerstenblatt said:

“This magazine is like Cosmo with fewer articles about sex.”

Cosmo's sex focus has worked well for it. It's the biggest selling beauty/fashion title on the newsstands. But that same formula focus could wear thin in the longer term (the magazine did slide 15 percent on the newsstand in the first half, after all), which may be an opportunity for Coles, who's Marie Claire was turned not only into a fashion staple, but a place where women can actually learn something other than “50 Kinky Sex Moves.”

Under Coles, the Marie Claire @Work content department was turned into a new polly-bagged quarterly magazine supplement, focused on tips and strategies for women juggling work and life, career advancement and employment challenges. The magazine also launched a series of career panel luncheons to engage women, and a mentorship program that will be executed around the country. LinkedIn was also being used to increase the buzz around Marie Claire @Work—the publication designed the Marie Claire Career Network on the social platform to give women an avenue for digital business networking and discussions.

Cosmo is a huge global brand empowering women,” Coles told Klieman.

Cosmo does empower women—to hop in bed. It is true that the brand covers other topics of interest, but its ace in the whole is always sex. Marie Claire, on the other hand, is more representative of a true general interest magazine, consistently exploring multiple aspects of women’s lives, and not just as a backdrop.

According to MagazineRadar, Marie Claire exceeded their previous all-time single issue ad-page record this September, earning the sixth spot of the top 10 women’s fashion magazines with the most increased ad-pages. Further, according to min box scores, Cosmopolitan posted ad-page losses for seven months when comparing 2011 to 2012 figures from February to September. On the other hand, Marie Claire saw two months of losses, and six months of growth over 10 percent when comparing the same periods.

This post should not imply that Coles should turn Cosmo into Marie Claire—they each need their own distinct voice for their own distinct audiences. It will be interesting, however, to see the direction the new editor-in-chief takes the brand. Historically, when a publication gets a new leader the first thing they think of is a redesign, an examination of content sections and the direction they wish to take a brand in order to receive appropriate recognition. With eyes watching the behemoth that is a legacy brand like Cosmopolitan, expect Coles to make her mark.

T.J. Raphael is an Associate Editor at FOLIO: Magazine. Follow her on Twitter: @TJRaphael1.

 

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Bill Mickey

The U.S. Loves Its Social Smartphone Apps

Bill Mickey Consumer - 09/04/2012-15:37 PM

 

A new report conducted by app store analytics firm Distimo finds that the United States is the most "socially savvy" country by virtue of its download volume of social apps.

According to Distimo, out of the most popular apps downloaded, 20 percent of the volume is apps from Twitter, Facebook, Instagram and the like. In countries in Europe and South East Asia, social app download volume doesn't exceed 10 percent.

These findings are part of a larger look at how social media app downloads compare to other apps. As an example, the report finds that while download volume among the 100 most popular apps in Apple's App Store increased 43 percent over the last two years, the top 100 social applications increased 193 percent between July 2010 and July 2012.

Further, Facebook lost its prominence by July 2012 as the top downloaded social app, falling to the third spot behind Instagram and Twitter (as measured across Canada, China, France, Germany, Italy, Japan, Mexico, Korea, United Kingdom, and the U.S.).

For the full report, click here.

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Bill Mickey

Folio:'s 15 Under 30 Is Back

Bill Mickey Consumer - 08/29/2012-13:57 PM

 

 

Some of us "older" publishing pros often quip it's the "digitally-savvy youngsters" that are driving the new publishing era—not just as consumers, but as talented members of the magazine publishing community.

In that spirit, it's time once again to turn the FOLIO: spotlight on the younger set and profile the next group of rising stars and innovators across traditional publishing roles, never-before-seen positions in new lines of business, and market-shaping start-ups: FOLIO:'s 15 Under 30.

Last year's list featured a cross-section of talent responsible for social media, interactive marketing, community management and new digital companies. These are all excellent, and we're equally impressed with individuals who are leading the way in defining new competitive opportunities for existing, more traditional products.

The nomination process is officially open—tell us who you think deserves to be on the list by filling out our simple online form. Our list-makers will appear in the October issue.

The only catch? All nominees must be younger than 30.

The deadline for nominations is Monday, September 10. Good luck and thanks for participating!

 

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Brian Stoller

Why Does Mobile Seem Immobile?

Brian Stoller Consumer - 08/28/2012-09:51 AM

 

Why has mobile yet to, well, mobilize? There are a number of reasons—a few of my favorites are:

Economic Downturn: As mobile was ramping up, the economy slowed down. Advertising budgets, particularly test budgets for new media, became difficult to acquire.

Growth of Social Media: The development of Facebook and Twitter stole some of the spotlight. Coupled with the tight economy, advertisers sought lower-cost ‘social media,’ perceived to be viral and free in nature. Ironically, mobile has been silently driving much of the traffic behind social media, which was confirmed when Facebook released mobile figures in advance of their IPO.

Lack of Consumer Data: Handset penetration, publisher audience figures, demographics, response rates, install rates—the list of complaints from advertisers seems endless.

Fortunately, the industry has made steady progress despite all of these obstacles. In fact, the marketplace for mobile ad inventory is as advanced as its cousin in the wired world. Mobile ad exchanges, Mobile DSPs and a host of buying models now offer advertisers unrealized opportunities while simultaneously providing publishers with the ability to monetize the mobile channel.

The Real Challenge
Premium mobile media CPMs may still be a challenge for most advertisers to swallow, as the industry has one final obstacle that stands before it: An understanding of how mobile relates directly or indirectly to overall media consumption.

‘The role of mobile’ in the marketing mix has been a discussion topic Mindshare has been exploring for some time. Recently, it has picked up tremendous speed as we enter into 2013 planning season. Client inquiries suggest a positive outlook for the industry and growth looms on the horizon. To spur spending, many publishers have offered cross-media studies, to help advertisers understand the duplication and effects of advertising within mobile, digital, and print properties. Most of these publisher opportunities are passed over, but not without extreme gratitude for making an effort to solve the advertisers concerns.

The truth is the industry requires a solution that spans multiple publishers and multiple channels. The advertiser needs information that allows them to allocate budgets accordingly, allowing them to feel confident that their return on investment will be maximized toward the best performing media. (Remember, the economic downturn is no distant memory; savvy CMOs have learned to scrutinize every dollar spent in the new economy.)

A Solution Exists
The technology to solve our channel attribution concerns already exists. Google, Apple, and Microsoft have all hedged their bets by building multiple mechanisms that will enable cross-device targeting within their operating system ecosystems. Additional work is being completed by independent companies to provide a more holistic series of tracking mechanisms that will align a user profile across channels, publishers, and devices. The real obstacle is the potential for pending privacy legislation by Government agencies.  

This past spring, the White House released its consumer privacy bill of rights in a whitepaper tilted Consumer Data Privacy in a Networked World. The National Telecommunications and Information Administration (NTIA), has begun establishing a privacy policy code of conduct, which could be proposed as a bill to congress as early as this winter. (NOTE: The NTIA is the same U.S. Department of Commerce governmental organization that oversees wireless spectrum management, allowing it considerable clout in the ecosystem.) Since the advertising industry is prone to self-regulation, the likelihood of this passing as law is questionable. Still, the industry remains hesitant to make any large-scale moves toward full cross-channel tracking while ‘a code of conduct’ policy is still being written. The European Union is considering similar policies backed by laws that could have considerable teeth.

The result is the industry now coming to a near standstill while we wait for privacy definitions to be constructed and agreed upon. As consumers become more sophisticated in their understanding, and to some extent mistrust, of data collection via the Internet, nearly everyone from publishers to advertisers, OEMs to carriers, and developers to politicians have had to manage consumer privacy issues. All sides have the desire to reach the same goal. The NTIA has done a good job of engaging all the stakeholders in a very democratic discourse. Yet we may need to wait a little longer for ‘the year of mobile’ as election year politics are certain to keep this far from widespread public debate.

Mobile stands to benefit everyone and everything—advertisers, publishers, even other media channels. Privacy and tracking is now the single largest obstacle. We all need to participate in developing the regulatory policies to stop the standstill and move the industry forward.   

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Bill Mickey

Bonnier Launches Media Company Start-Up Accelerator

Bill Mickey M and A and Finance - 08/23/2012-12:53 PM

 

Once derided as Johnny-come-latelys to the digital media game, traditional publishers are now becoming enthusiastic start-up accelerators, buying or incubating early-stage companies that aim to disrupt the media market. Bonnier has just joined the club with its own Innovation Lab, a 14-week program seeking applicants who are interested in "developing revolutionary products and services that will change the way major media companies engage with their audiences." The idea being that Bonnier, like other publishers, has already waded its way into the modern media world and knows a thing or two about digital business and audience development, marketing and content strategy.

Not quite an ownership-based incubator, such as Hearst's Interactive Media unit, the Innovation Lab is more like an educational program that helps entrepreneurs get their ideas off the ground and into the market.

The brainchild of David Rich, Bonnier Corp.'s director of digital innovation, the program features a dozen mentors. Some are from Bonnier's ranks, including CEO Terry Snow, digital audience and analytics director Jennifer Anderson and VP of corporate communications Dean Turcol. And some are from VC firms and other start-ups.

Four start-ups will be selected for the first program and each receives a pretty generous set of perks, including a minimum of $25,000 in seed capital, $5,000 in PR support, $10,000 in PayPal transaction fees and about $79,000 in hosting credits from a variety of services including Amazon, Rackspace and Microsoft Azure.

For its part, Bonnier will get an equity stake in the startups if they make it from drawing board to real company—and presumably first dibs if it's a concept uniquely appealing to Bonnier. But how much that ends up being depends on the progress of each start-up and what is ultimately negotiated as they progress through the Lab.

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Brian Pagel

Three Core Elements Marketers Want From Tradeshows

Brian Pagel B2B - 08/21/2012-15:39 PM

 

Like most of you, I pay close attention to what is going on in the event space. I find myself particularly interested in trends and the overall outlook for our industry. Not surprisingly, some events are up, others are down and many find themselves relatively flat. However, being internal optimists, we always look for the silver lining—exhibit space was off, but attendance was up. We had more exhibitors, but the average booth size was down. We are the masters of the spin for our customers, but what is really in store for trade shows?

The Center for Exhibition Industry Research recently released research on “The Role and Value of Face-to-Face Interaction.” Even during the “Great Recession,” and now in the midst of an increasingly digital world, in person events remain an important tool for many marketers. Your customer’s still have a desire to show their products and services to a highly concentrated group of targeted influencers. 

This is the good news, but there are still many risks to our overall business. Budgets are decreasing and every dollar is being scrutinized. Simply put, you cannot afford to rest on the historic influence the event industry has had as a marketing tool. We need to challenge the norm and look to adjust our model for the future. Savvy marketers want a simple, measurable and hassle free experience. So what does that mean?

Simple: Everything from the contract process to payments to registration needs to be easier.  Consider an alumni program that will take basic information (address, phone, contact, product category, directory listings, etc.) and carry it over year to year.  Give them the opportunity to update that information, but why should you ask your returning customers to recreate the wheel with every event?

Measurable: We all deal with question on ROI. Unfortunately, there is not a one size fits all approach, but if your staff understands a marketers objectives in advance of the event, you can work to formulate and define what is or is not a realistic outcome. How will you ultimately be graded?

Hassel Free: If you have been in the business for any period of time, you know the single biggest complaint is drayage, labor and other variable costs.  Most exhibitors do a poor job of planning, and far too often they are surprised by their invoice.  Make it easy and look at “all in” packages that are inclusive of drayage, basic utilities, etc.

What are you doing differently to make for a better customer experience?



Brian Pagel is a Vice President at Nielsen Expositions, where he runs The Kitchen and Bath Industry Show. Since re-joining Nielsen in 2001, Pagel has also served as a vice president in the Decorated Apparel Group. A 15-year veteran of the publishing, convention and exposition industries, Pagel has also held senior account executive positions with Leader Publishing and Bill Communications.

 

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Baird Davis

Publishers Fiddle While the Newsstand Channel Burns

Baird Davis Audience Development - 08/16/2012-08:40 AM

 

To paraphrase Senator John McCain—let’s have some straight talk. The newsstand as we know it is nearing endangered species status. How much further do newsstand sales have to decline before publishers take corrective action?  

It’s well known that newsstand sales are in the dumper, but the depth of the audited publication sales slide in the first half of this year is even greater than has recently been reported by the media. A 9.6 percent sales decline (reported by the media) is huge, but the extent of the actual slide is more than 20 percent greater.

The reason for the difference is that the numbers reported by the media only represent the sales status of titles that were audited in both the first half of this year and the first half of last year. It doesn’t, however, include titles audited a year go, but have either ceased being audited and/or have discontinued being published. Examples include; Soap Opera Weekly, Soap Opera ABC, Soap Opera CBS, Cooking with Paula Deen and Spin. If sales data from discontinued/no longer audited titles are included in the calculation, the overall unit sales decline is estimated (based on preliminary ABC reports) to be a breath-taking 12.8 percent and a corresponding 12.2 percent fall in revenue.

The Newsstand Channel Is Being Hollowed Out

The devastating first-half sales are, as we’re all aware, not an anomaly. The steep decline began in the first half of 2008 and has essentially continued unabated since then. A brief recap illustrates the accumulative depth of the sales slide:

 

The unit sales of audited publications have declined nearly 45 percent in the last four and a half years. Since 2007 it’s estimated that by the end of 2012 the annual unit sales of audited publications will have fallen from about 930 million to 510 million—a staggering annual sales loss of 420 million copies. The revenue will have declined from $3.2 billion to approximately $2.4 billion.

What’s Gone Wrong?

There are many explanations for this decline—the great recession, fewer store visits and a more cost conscious consumer. But the most significant has been the impact of technological change that has increased the proclivity of consumers to acquire news and information on a range of mobile devices that are offering better and better user experiences. Together all of these things have contributed to the decline.

Should the Decline Have Been So Steep?

In this 4-year period of unprecedented change a substantial sales decline would certainly have been expected. But should it have been so severe? I would argue the decline has been exacerbated by a timid publishing community and the restraints of an antiquated newsstand channel distribution system. The channel has, in effect, been held hostage by a costly, inefficient system loaded with duplication of effort. This is largely a product of its two-middlemen (wholesalers and national distributors) configuration.

Years ago the channel probably required a two-middlemen check and balance approach in order to meet the needs of accommodating a vast distribution network with over 500 independent wholesalers. Today just three wholesalers control the majority of all magazine newsstand distributions and the two-middlemen configuration seems seriously out of date. However, the corrosive often adversarial nature of this configuration continues to persist, which has seriously thwarted the prospect for channel reform.

As I indicated in a February story (after the audit bureaus reported last year’s second-half sales) the magazine newsstand had reached viral conditions and it was clear that the desperately persistent decline was now feeding on itself. Six months later the first half results (the steepest sales decline in recent history) only confirms the viral nature of channel conditions.

Publishers and Wholesalers: Coping in the Age of Newsstand Austerity

Publishers
For years publisher’s newsstand actions were dictated primarily by competitive self-interest. They largely ignored the health of the supply chain and the financial sustainability of its wholesaling “partners.” These actions, although seemingly counter productive, were precipitated by the huge diversity of the publishing community (like herding cats) and by the knowledge that they had a range of other alternatives (not just newsstand circ) for delivering readers to meet their circ level requirements.

The trend to less single copy circ has been continuing for many decades, but the recent 4-year newsstand sales decline, coupled by the advent of digital (replica) circ, has intensified the effect of the newsstand sales decline.

Let me give you a current example of how this works. People Magazine, the undisputed newsstand sales leader, experienced a nearly 19 percent decline in newsstand sales in the first half of this year. This translated to a 214,000 drop in newsstand circ. But People’s total paid circulation (nearly 3.6 million) remained virtually the same as it was in the year previous period (actually it was up about 6,000). To compensate for the “lost” newsstand circ, the subscription circ was increased by 220,000—this included a 77,000 increase in verified circ. Additionally People reported (for the first time) 37,000 replica circ.

The point here is publishers have alternatives for compensating for “lost” newsstand circ. But it comes with some serious tradeoffs. Adding subscribers to meet circ level requirements generally increases reader acquisition costs and, of course, the added subscribers remove potential newsstand buyers from the market, which has a subtle, but real, impact on future newsstand sales.

Wholesalers
On the other hand wholesalers have far fewer alternatives for compensating for declining newsstand sales. Essentially those alternatives come down to reducing costs and increasing scale (growing market share). That’s exactly what’s happened. Wholesalers have lowered costs by reducing staff, consolidating distribution management at central locations and curtailing much needed system improvement investments.

Although it’s difficult to measure the sales effect of these cost-saving initiatives, by all accounts the cost containment strategy of wholesalers has definitely contributed to the sales slide. In the process the three remaining wholesaler groups continue to battle for market share. The News Group, one of three major wholesaling groups, has recently taken the Kroger account (a major seller of magazines) from another super-wholesaler, The Source. The News Group and Hudson News teamed to buy CMG, a large national distributor, from Hearst and Condé Nast. It’s still too early to read the results of this precedent-setting move, but I suspect it’s quietly resonating in the market. All of this appears to be setting up the inevitable battle for wholesaler survival among the three remaining wholesaling giants. This battle may come to nothing, but in the interim it’s helping keep the fragile newsstand channel in an unsettled condition.

In a declining newsstand market publishers have options, albeit they’re often costly. Wholesalers have a lesser number of viable options for coping in a down market. They are desperately trying to keep their financial ships afloat, while fighting a market share battle, which could eventually reshape the newsstand channel.

It’s Up to Publishers to Save the Newsstand Channel

Publishers have alternatives for replacing “lost” newsstand circ. This, however, has provided a false sense of security that has partially blinded them to the perils of a newsstand channel with greatly diminished capabilities. Yes, the prospect of more digital circ is in publisher’s future, but let’s be clear about the realities of consumer magazine publishing—for many years to come publishing survival will continue to be based on producing quality print products, attracting a cadre of advertisers, cost effectively acquiring print readers and protecting prime sources of circ (reader) acquisition.

None of the many circulation sources is more important than the newsstand. Without a viable newsstand sales market the prospect for the survival of consumer magazines will be seriously diminished.

Wholesalers and publishers, whether they like it or not, are bound at the hip. Publishers desperately need a viable newsstand channel and wholesalers need publishers that are fully committed to producing product with retail sales appeal.

What Can Be Done to Slow the Sales Slide?

At this juncture it’s not a matter of growing sales, but slowing the devastating 10 percent rate of annual decline. It’s no secret that channel efficiencies can be improved, duplicate effort eliminated and costs reduced. If that happened it could go a long ways towards stemming the severity of the sales fall.

If publishers and wholesalers needs are mutually dependent why aren’t these things being done?

Resolve the Scan-Based Trading Issue

There is no simple answer. But if I were to pick the major sticking point it involves the publisher/national distributor/wholesaler battle over how to adjust to the effects of scan based trading. Scan based trading now dominates wholesaler relationships with their major retailing clients. However, publishers/national distributors have not fully accepted this reality. It’s too complicated an issue to fully discuss in this note, but the gist is it revolves around publishers accepting scanned sales data, shifting inventory control to publishers and coming to grips with the so called “shrink” factor (the difference that may occur between scanned data and actual counts). There are also some audit bureau issues involved.

Scanned-based trading is a thorny issue, but resolving it may hold the key to unleashing the prospect for improving efficiencies and reducing channel costs. Publishers and wholesalers should be encouraged to resolve the scanned-based trading differences, which, in turn, will enable them to get on with the task of working more cooperatively to address the more important issue of stemming the sales slide.

I believe the ball is in the publisher’s court. They must step up to bat and get this done. If not the future for the newsstand looks very gloomy.

 

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Bill Mickey

Foliomag.com Changes to Metered Paid Access Model

Bill Mickey B2B - 08/14/2012-12:37 PM

 

An announcement went out today, but if you haven't seen it, we've decided to put Foliomag.com on a metered paid-access model. Here's why:

Our mission has always been to provide you with the most up-to-date and in-depth resources to help media companies succeed. Our news and analysis lead the industry. Our blogs, columns and more offer the context and perspective you need to optimize your business.

At the core of our decision was this: We felt that it's very important to place a clear value on our content, and to recognize the value that our best customers see in what we do. Also, as a brand that covers the digital-media transformation, we seek to not just reflect what the industry is doing, but to lead it as well.

This paid-access initiative will also allow us to invest in Foliomag.com—to significantly improve it over time. We'll be adding regular multimedia features, more voices, more connectivity and more content.

Our paid-access model begins immediately. Here's the way it will work: Each month, you'll get to read eight stories on a complimentary basis. You'll be reminded as you get closer to the eighth report. After that, you'll be given the option of buying an annual subscription to Foliomag.com for $69.95. Alternatively, you can gain full access to the site on a monthly basis for $14.95.

As a leader of the digital-content marketplace, we to need to adapt to the changing times. Our new format allows you, our most loyal customers, to choose the level of information you need.

Feel free to comment below; you can also email me at bmickey at red7media.com.
 

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Linda Ruth

REMAG Pilot Program to Launch in December

Linda Ruth Audience Development - 08/09/2012-13:41 PM

 

REMAG’s sprawling and multi-faceted kiosk program would not be easy to announce in two to three words on a newsstand magazine cover. In fact, it would be hard to explain in 25 words or less. It’s new, fresh, innovative and, from a blogger’s point of view, a little complicated. But the program is, in fact, all about the newsstand sales of magazines, so it deserves our attention and comprehension.

REMAG’s Blake Patterson called me to give me an update on the program. Since I blogged about this last year, REMAG has added a step. The program works like this:

1) Remag sets up a magazine recycling kiosk in participating retail stores.
2) A store customer brings a magazine back to the kiosk for recycling.
3) When the magazine is entered into the kiosk a screen comes up listing some local charities and schools from which to choose.
4) After the charity is chosen a coupon screen comes up. The customer may select four coupons from the categories of choice.
5) The coupons are printed from the kiosk with the code for the donation embedded in the coupon.
6) After each coupon is redeemed, a nickel goes to the charity that the customer has chosen.

Since a customer can redeem up to four coupons per magazine recycled, that means that a potential donation of 20 cents will go to charity for each recycled copy. That charitable donation is currently paid directly by REMAG, who believes in this model enough to subsidize it.

When I first blogged about REMAG’s idea, the response from my readers was enthusiastic. They called it a fantastic idea, bringing sustainability into the realm of print publishing, not only by recycling the product but by incentivizing the further sale of magazines.

SEE ALSO: Can Magazine Recycling Boost Retail Sales?

I liked the idea because we badly needed then, as we do now, something new in our world, something positive and forward-looking. The REMAG model seemed promising. It still looks promising, combining, as it does, magazine sales, sustainability and charitable donations—or, as Patterson puts it, three great stories to tell.

“We’ve always spoken about a magazine purchase as a value proposition extending beyond the purchase itself,” said Patterson. “This adds massive value to the transaction, value that a customer can discover directly, by walking over to the kiosk and finding the coupons and charitable donations available.”

Given how ambitious the program is, it’s no surprise that it has taken a full year to launch the pilot.  But launched it finally will be, in eight News-Group-serviced Save Mart/Lucky stores starting in December. There will be two kiosks per location, one per entrance. And the EPA itself has reached out to REMAG to start a program in Puerto Rico, where landfill space is running out. As a result, REMAG is setting up a pilot in three Super Max locations in Puerto Rico starting in February 2013.

What REMAG is looking for from the publishing community now, as they were a year ago, is visibility, participation, and support.  How can we as an industry build magazine sales through this? How much can we boost newsstand sales from the entire category by, for example, having a generic coupon for all magazines? Or for all the magazines published by a single multi-title publisher? And a final great question: What more can the rest of us do to help?

SEE ALSO: Magazine Publishers Family Literacy Project 

 

 

 

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Bill Mickey

Time Inc. Book Value and Fair Values Getting Closer

Bill Mickey Consumer - 08/07/2012-09:21 AM

 

While there are pockets of good news on the ad revenue side of the publishing business these days, overall publishers are still duking it out on the front lines. This is illustrated for better or worse in Time Inc.'s 10-Q report released last week. The publishing giant's revenues dropped nine percent in the second quarter to $858 million and six percent for the half to $1.6 billion. Every segment within the publishing division recorded a loss in revenues. And the losses prompted the company to warn that because "soft market" conditions are expected to continue through the third quarter, the fair value and book value of the company's brands are getting uncomfortably close.
 
This ratio is pointed out by anonymous blogger Dead Tree edition, who also notes operating income for the half is down 60 percent compared to same period 2011. As of the end of last year, Time Warner says the fair value of Time Inc. is 19 percent higher than its book value, and that it didn't actually have to do an impairment analysis during the second quarter, but if that 19 percent gets erased due to continued declines this year, the company may have to take a non-cash charge out of earnings that are already significantly pinched.

"During 2012, the Publishing segment has experienced soft market conditions that have negatively impacted its operating results," says the report. "If those market conditions worsen, it is possible that the book values of the Time Inc. reporting unit and certain of its tradenames will exceed their respective fair values, which may result in the Company recognizing a noncash impairment that could be material."

This may never happen, the 19 percent separation in value is a decent cushion but with the market condition the way it is, the company felt compelled to issue a warning nevertheless. If book values (the value of the company straight off the balance sheet) do end up exceeding fair value (the value of the company determined by a hypothetical sale, or market value), then there will be a non-cash charge to the bottom line.

In the meantime, the report also highlights just how expensive digital investments have become for companies that are making heavy commitments to web, mobile and tablet development. As print production scales back, savings are immediately eaten up by digital. TW says that in the second quarter costs dropped about 4 percent, or $13 million due to less production associated with lower print volumes, but were entirely offset by investments in websites and tablet magazines.

As for the publishing group's segments, subscription revenues were down 11 percent for the second quarter to $292 million and 7 percent for the half to $623 million. Advertising was down 7 percent for the quarter and 6 percent for the half to $472 million and $855 million respectively. Content sales were down 20 percent in the quarter to $20 million, but that gap narrowed by the end of the half to a loss of 5 percent, ending at $39 million.

In the second quarter, Time Inc. took back the management of SI.com and Golf.com from Turner, who had been paying Time Inc. licensing fees to manage the sites. With the two site back in the fold, advertising losses were partially offset by about $7 million, but that was nulled by the loss of $9 million Time Inc. would have had from licensing fees.

 

 

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Bill Mickey

Huffington Post's Huffington App Now Free

Bill Mickey Consumer - 08/02/2012-14:16 PM

 

Joe Pompeo at Capital New York reports that Huffington Post has made its Huffington app, launched in June, free. The app's single copy price was 99 cents, $1.99 per month or $19.99 per year and, at the time, reflected the you-don't-get something-for-nothing mentality now so prevalent in digital content publishing—especially when producing a magazine app like this one is still far from efficient or low-cost.

But, in hindsight, Huffington had clearly wrestled with whether to charge for the app or not. When Folio: first reported on the app's coming launch, executive editor Tim O'Brien said the business model had yet to be determined—and this was only weeks out from its debut.

SEE ALSO: Inside Huffington Post's Weekly Magazine App

Pompeo says the change in strategy was revealed during a company meeting yesterday, and the app is already listed as free in the App Store.

All of this was underscored earlier this week when News Corp.'s The Daily axed 29 percent of its workforce, or 50 employees, and streamlined its content production.

The changes at Huffington and The Daily highlight the difficulty publishers are having with nailing down a consistent business model for magazine apps. The technology is new and the products and the experience they offer are still new for consumers and that mix can bloom into a confusing array of strategies as publishers balance customer preferences with business realities.

This can be especially frustrating as publishers also try to figure out how apps relate with and exist next to their traditional products. A Huffington spokesperson tells Pompeo that the decision to go free was triggered by the fact that The Huffington Post itself is free and the app's paid model clashed with that. Perception goes a long way.

In an earlier blog post, Penton Media senior vice president of strategy and business development Warren Bimblick sniffed out a pricing scheme that might have been a bit too perfunctory.   

 

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