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Building a Winner
The Economist is somewhat of a maverick in the magazine world. Revenue is split 50/50 between circulation and advertising and at a time when many publishers are looking at circulation as an area to cut costs, it keeps investing. Catering to the “global reader,” The Economist also conducts hyper-local marketing drives, including spending a reported $1 million on a push in Chicago and introducing a mobile delivery program in New York.
The Economist Group reported record operating profits of $92 million for the fiscal year ended March 31, up 26 percent over the previous fiscal year. Total revenue rose 17 percent to about $514.2 million. In July, The Economist Group acquired Washington, DC-based Congressional Quarterly from Florida’s Times Publishing Company.
It’s not all roses, though. Ad pages plummeted about 25 percent in the first half of 2009 and the company cut as many as 130 positions, reducing its global workforce to around 1,100. And while The Economist Group won’t comment, many industry observers say the company is shopping CFO (with others saying CFO has seen revenue fall by as much as $20 million, forcing the company to pull it off the block).
Here, publisher Paul Rossi talks about The Economist’s approach, in which “brand investment never fails.”

FOLIO: The Economist has been held up as an example of a magazine that is bucking the trend of print decline experienced by many of your peers. What do you attribute this to?

Rossi: In terms of circulation, which is obviously the driver behind the question (as opposed to advertising, where everything is going down—we’re just going down less quickly), it starts with having a product that people want. Over the last 10 years, particularly in the U.S., we’ve seen an increasing demand to understand the world. Week in, week out, The Economist delivers opinion and analysis of what’s going on. That’s coupled with the strategic thought that there was a much bigger opportunity in this market than we previously realized. We’ve done a lot of work around market sizing, looking at current readers and how many more were out there. We came to the conclusion that there was a bigger market than we were reaching and that this was a marketing problem rather than a product problem. We aggressively promoted The Economist and spent a lot of time and money building the brand. Partly this is a product whose time is right but also we committed the resources and energy to making it bigger.

FOLIO: Please describe how The Economist has defined its market position relative to its peers.

Rossi: This is a difficult market for everybody. We start with the reader first. We have a business model built around the reader first. It’s about positioning products as premium and backing that up with everything you do, and being able to market it. Our newsstand and subscription prices [$6.99 for newsstand, $67.25 for a 25-issue subscription] are clearly different from other magazines in this space.

FOLIO: Talk about the editorial mission of the magazine and how that has adapted. How have you maintained the editorial standard through changes in editorial leadership?

Rossi: We write one edit product for the world. The one in the U.S. is the same as the one in China. We’re still socially liberal, fiscally conservative and live to our mission, which is written in every issue: “To take part in a severe contest between intelligence which presses forward and unworthy, tumid ignorance obstructing progress.”
What that means, in slightly less Victorian English, is we debate what moves the world forward. A lot of people at The Economist think we’re caretaking for the next generation who will take over business. This is something with a clear personality.
FOLIO: At a time when most publishers are integrating their print and editorial operations, The Economist maintains separate publishers for print and Economist.com. Why is that?

Rossi: We run online editorial as one group and in commercial terms we run subscription marketing and ad sales for print and digital as one integrated group. But what makes it different is having an online publisher and that’s about how we develop the site and develop the audience. Economist.com is the place people can go for intelligent debate. We do all production out of London. The majority of the business is integrated. The approach is, editorially one and commercially largely one, so as an advertiser you wouldn’t know. This idea of how you move that debate online, we build that around one platform. However, technology development is easier to do with one person focused on it.
FOLIO: Please talk about the circulation strategy in the U.S. How are you building your audience? What is the newsstand distribution?

Rossi: It starts with identifying the reader. We do a lot of profiling. Many of our readers lived or worked or were born overseas. There are different ways of reaching these people rather than just buying a list from another magazine. We build a picture that can take us inside other places. For example, The Economist is sold in CostCo. On the face of it, that’s not logical but CostCo is actually one of our better sell-through venues. We don’t go into every single CostCo, we go to the ones in zip codes where we are most likely to find our readers. By pushing our understanding of our readers, we can go out and find them.

Innovation is also part of the strategy. With Economist Direct, you can get a text message on Thursday, respond by mobile and get a copy delivered to your doorstep by 9:00 the next morning. That’s all about pushing out people’s ability to get their hands on a copy. Layered on top of all that is building the brand. We had relatively low brand awareness in the U.S. 10 years ago and we spent a lot of time and money building a brand. With the city campaigns we saturate a city for six to eight weeks. The investment in brand softens the ground for understanding what they want and need from us.

FOLIO: Explain the structure of the circulation and marketing department. How does this work?

Rossi: We have a marketing team whose job is acquisition and retention and we have a newsstand and retail team as well. We manage the brand completely separately. Brand investment stays the same no matter what happens. We don’t manage the brand up and down depending on the business. We invest in the brand year round.

FOLIO: Explain the market-focus approach.

Rossi: It says, let’s identify cities where we effectively index below where we should be against competitors and our target audience. Sometimes it’s about distribution, we may not have enough copies in the market.
A campaign will consist of outdoor, radio and events. We do things you normally wouldn’t expect from The Economist because we know that’s where our audience is, such as tie-ins with the Second City comedy troupe around the presidential election. We will go into a region and market heavily for six to eight weeks and measure things like sell rates and copy sales, renewal rates, new business, cancellations.
It’s a process of doing branding and building the business city-by-city, step-by-step, rather than trying to do it all at once with a national campaign.
FOLIO: At a time when publishers are cutting circulation costs, how is it that you keep investing?

Rossi: Because we can. That model allows us to do that. We can look at acquiring a customer as a profitable experience and adding profitable customers is something we can keep doing. It’s self-funding to a certain degree. We’re always testing and there are certain elements that bomb but en masse you hope it’s moving forward. We know there’s opportunity, we know we can make money in the long run.

FOLIO: What is the profitability ratio for recruiting a subscriber?

Rossi: I’m not going to share the number but we have a point at which someone is profitable and there are ways we can test that. We can look at each channel and say, ‘People who come through the Web will pay this or people who come through direct mail or e-mail will pay that.’ Everything has a different point at which it’s profitable because the costs are all different. Some might be slightly higher at the front end but those people tend to stay with us longer. You can also look at revenue per customer—we have a lot of customers who give gift subscriptions. There are a number of different metrics you can layer in beyond direct mail or e-mail.

FOLIO: The Economist seems to be focused on what you do well: print, increasingly online. How do ancillaries fit in and what are you doing beyond traditional print and online products?

Rossi: We’ve got products that fill a reader need. The Economist is available on the Kindle. We have an iPhone app coming out shortly. Then we’ve got other products within The Economist brand such as the Business Intelligence Unit, which provides data and analysis for companies operating beyond their domestic boundaries. That’s something very granular and b-to-b; it is largely subscription-driven. That business is not quite as up and down as advertising.
We do a number of things with advertisers, such as EnergyBill, an online simulation we built for Chevron. Using our data you can power a city of the future and make choices about different energy sources. We have events and they’re very much about building the brand, bringing The Economist to life. We’re also testing a new quarterly magazine called Intelligent Life, which has been described as “The Economist in black tie.” It’s much more lifestyle-driven.
Ultimately everything has to be run for profit. Some things will be about broadening the brand and getting the product into people’s hands. You need to be pushing stuff out, so some things work, some don’t (particularly on the events side) but we’re trying to bring more people into the brand.

FOLIO: How do the business lines compare in size?

Rossi: The biggest driver is the magazine and that’s equally balanced between advertising and circulation. Online and data businesses are second and third, the others are all quite small.

FOLIO: PIB numbers say you’re down 23 percent in ad pages for the first half of 2009. How accurate is that?

Rossi: The PIB numbers are close. We’re not a discounter so the numbers are pretty accurate. It’s a tough market and we’re not immune. You have to be clear about what problem you’re trying to solve for a marketer. The days of walking in and asking how many pages would you like to buy are gone. They’re not advertisers, they’re marketers who happen to do advertising and they’re facing the same challenges we are in terms of smaller budgets and ROI. We’re seeing a lot of demands for intergrated programs that move from print to online to white papers and events. We just built a forecasting tool for SAP where people could demonstrate how bullish they were about their industry and compare that to everyone else. That’s a data solution, it’s an advertising solution and it’s an online solution.

FOLIO: You just added Congressional Quarterly and you’re said to be shopping CFO. What’s the ideal product mix for The Economist?

Rossi: We are profitable and we have a desire to grow. You should look out for future changes and future acquisitions in The Economist Group. What you’re seeing is a move toward subscription-based business. These are good, renewable revenue streams.

SIDEBAR
The Way of Economist.com
Publisher Ben Edwards reveals new priorities for online.
While Paul Rossi serves as publisher of the print version of The Economist, executive vice president Ben Edwards is publisher of Economist.com, overseeing a group that handles online product development, Web development, design, marketing, production and operation. “We build the platform—Web publishing, community and advertising,” says Edwards. “Then we work closely with editorial and the ad sales teams who are integrated into the regional businesses.”
Economist.com uses four distinct sales teams serving the U.S., U.K., Asia and Central Europe. “The approach differs by region and in the U.S. the approach is quite heavily integrated,” says Edwards. “In the U.K., we’re less integrated and we may be lagging behind U.S. buying habits by a year or two. But in the past six or nine months, we’ve been seeing more appetite from European clients for large, integrated purchases.”
Traffic has doubled in the last two years with 4 million unique users and 25 million page views. One-third of the online audience is also a print subscriber while another 15 percent is an occasional newsstand purchaser.
It’s an engaged audience. Economist.com gets 25,000 comments to the Web site every month with an average of 60 comments for every article it publishes, according to Edwards.

Big Changes: New Brand, New Social Media Initiatives
Economist.com is preparing to make significant changes to its brand strategy. “Up to this point we’ve invested in a separate brand,” says Edwards. “We’re changing that in the next month or two to publish under The Economist brand. That reflects the reality of how people think about us.”
Three years ago, Economist.com embarked on an ambitious, proprietary social media project called Project Red Stripe that basically fizzled in 2007 without a concrete product. At the time, Economist executives said there wasn’t a clear need for the product.
Today the brand is investing in developing a sophisticated presence on Facebook (150,000 fans) and Twitter (75,000 followers). “We have a loose embrace of many other unofficial sites,” says Edwards. “It’s a very cost-effective way to reach out to people where they live on the Web and give them opportunities to interact with content, events and each other.”
Still, The Economist continues to invest in a social media product as one of its key online initiatives. “We’re building off of our work with Project Red Stripe,” says Edwards. “Fifteen months ago, we made the decision to move off a proprietary platform to an open source platform, which in our case is Drupal. The principal reason was the richness of the existing Drupal social media features and the ability for us to engage with a relatively small and focused group of designers.”
Economist.com is introducing several new online products in the second half of 2009, including a two-week long debate program featuring experts and guest speakers.
Over the next few months, Economist.com will also roll out profile pages, organic groups and forums. “We think there’s an opportunity to take the debate product and build a mini debate product around it—instant debates our editors can set up on the fly that put a little structure and meaning to the outcome through built-in polls and real-time voting,” says Edwards. “That gives people a sense of what other people think about it, which is important to our audience.”
Economist.com is also launching 11 online channels dealing with different areas (Europe, the U.S.) and topics (such as business and finance). Each channel will have full-time dedicated online editor. “Their design is to build this lean-forward, free experience” says Edwards.
The two approaches work together, according to Edwards. “The way I think about how we can build opportunities versus reaching out and embracing interactions among Economist readers is with the former we can offer richer, deeper and more meaningful interactions,” he says. “If you look at what goes on through Facebook the interactions tend to be very light. By contrast, we’ve developed online debates where people are posting 1,000-word essays. These debates generate about a novel’s worth of content. The two approaches are complementary. We can build rich connections and we can harness lighter conversations and connections through sites like Facebook to build bridges between different experiences.”

Making Money Online: Balancing Advertising and Paid Content
Revenue for Economist.com grew about 30 percent in 2008 and is up about 20 percent in 2009, according to Edwards. “Advertising is performing well and we’re growing fairly strong this year in the face of declines in premium display,” he says. “We think the product is high value and we charge a lot of money relative to our peer group.”
Economist.com is also having some success with a paid content model at its site and is looking to extend that approach into other digital venues. “We have a long history of subscription succes and we would like to develop that further,” says Edwards. “Offline, our premium product is the magazine and we characterize that experience as ‘lean back.’ In electronic media, it’s more about ‘lean forward.’ We’ve been the number one magazine on Kindle and we’re priced at five times that of our competitors on Kindle. We’re pursuing devices and opportunities to deliver that ‘lean back’ experience electronically and we think there’s an opportunity rising now to deliver that experience online through the browser.”
Sill, advertising accounts for more than 90 percent of Economist.com’s revenue and Edwards says the goal is to move toward a more balanced ratio with subscriptions and paid content.
“We believe we can grow both revenue streams,” he adds. “The way we do it is to differentiate between the lean-back experience online and a separate, free, advertiser-supported experience, which is more lean forward because it is social and interactive and looking to include things rather than exclude them. That’s part of the live Web. You’re linking to other sources and inviting other experts to share opinions.”

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Social Media Apps For CMS
Social media remains a priority for most publishers but in the wake of failures of proprietary, standalone social media networks such as Variety’s “The Biz,” publishers are realizing that rather than creating community at their own sites, they need to be catching readers where they already are: Facebook and Twitter.
Playboy started out building its own networking products on platforms like Ning, but now finds Facebook more cost efficient. “We’re putting more resources there and getting more response,” says director of online communities and social platforms Paul Thomas.
The same is true for b-to-b publishers such as Bobit Business Media, which publishes Police. “Our editors didn’t think having a Facebook page would be worth it, but we did a search and found 600,000 users with ‘law enforcement’ in their profile,” says director of marketing and e-media Christine Oldenbrook. “We set up a fan page and had 100 fans overnight. Our editors will use it to push content while we market subscriptions through it.”

Choosing Apps
Most any content management system—enterprise or open source—is capable of basic social media functions such as commenting. But now publishers are looking for social media apps that offer a direct connection between their site and the broader social networks such as Facebook. “Two years ago, CMS was 80 percent of the focus, now maybe it’s 40 percent for a publisher,” says Dave Iannone, founder of Web development firm Go Forward Media (and architect of the FOLIOMag.com design).
Many of the social networks are introducing both generic and system-specific applications to tie the CMS to their network. However, most of those applications are geared more toward open source rather than proprietary systems. Facebook Connect is an API that allows users to integrate parts of the Facebook experience into their Web site or mobile program. System-specific versions of Facebook Connect are also popping up, such as modules for open source systems like Drupal and WordPress.
An article on social media blog Mashable talks about “8 of the Best Social Media Extensions for Joomla,” including the AddThis Button, which is a single method of adding major social media bookmarking and sharing applications such as Digg, Twitter and Facebook.

Single Point of Entry
Instant access through a single point of entry is becoming key. FastCompaany.com now allows users to sign into the Web site via the user’s Facebook account. “There are plug-ins that if you comment in one area, it let’s people know you commented everywhere else you have an account,” says Iannone. “That does away with the need for a ‘site account.’ You have to integrate in all these other places beyond what you are doing on your own site. You’re going to get more fans on Facebook and you’ll have a direct connection that’s way more valuable than e-mail.”
ABA Journal, the association magazine for the American Bar Association, recently launched a program called Legal Rebels that features a standalone Web site with multi-media profiles of 50 legal profession innovators, as well as its own dedicated Facebook page for the program [see the full story on page 24]. However, the dedicated site also has links to major social media outlets such as Facebook, Twitter, YouTube and Flickr embedded right into its CMS (Expression Engine). “It just involved signing up for each of the services (Facebook, YouTube, etc.) and adding a link on our site,” says editor and publisher Edward Adams.
To keep up, some of the enterprise social media platforms such as KickApps and Ning are starting to introduce sign-on modules that can be used with sites powered by open source CMS such as Joomla, Drupal and WordPress.
Five Steps Toward Greening Your Magazine
One of the places to start is to review the entire design, production and distribution supply chain. Here are some areas that can help green your process:

• Inks and Coatings. Using Low Volatile Organic Compound (VOC) inks is better than before. Aqueous coatings protect magazines with minimal impact.

• Paper. Papers certified under one of the main Sustainable Forestry Management Programs, such as Forest Stewardship Council (FSC), Sustainable Forestry Initiative (SFI) or Programme for the Endorsement of Forest Certification (PEFC) ensure that the paper has been manufactured using environmentally responsible forestry and manufacturing processes.

• Retail Distribution. Use store-level sales data to optimize print orders. Don’t try to send copies over the requested amount unless you have compelling data.

• Mailing Lists/Co-mailing. Update your mailing lists and use good list hygiene practices.

• Digital Workflow. Going 100 percent digital eliminates film, chemicals and proofing materials as well as the fuel used to transport proofs back and forth.

Most importantly, self promote. Having readers understand what steps you have taken to green production and distribution will have an impact on ad sales.

Bio: Bruce Jensen is group vice president of sales for Transcontinental Printing’s Magazine, Book & Catalogue group.
Green at Retail: Magazines Can Increase Environmental Stewardship
Green at Retail: Newsstand Marketing and Distribution is a new “green paper” written by the audience marketing company Next Steps Marketing and Green America Better Paper Project—a nonprofit that grows the green economy and supports environmentally responsible magazines—that outlines ways that publishers can achieve higher efficiencies, increased sales, and build better brand awareness with the greatest impact and lowest environmental and economic costs. Here’s a quick look:

Efficiency Tips
• Order regulation. Work with your account executive to review line by line distribution and request changes where the sale is too high or low.
• Remove zero copy sales. A report is available from your national distributor that highlights retailers that don’t sell any copies. Remove these retailers from your distribution.
• Move to non-returnable distribution. You are paid on your entire draw at a greater discount. This reduces waste, shipping and printing costs.
Marketing & Distribution Tips
• Test new markets. Target markets by demographics, psychographics, or similar titles performance.
• Limit risk. Partner with retailers to get the right product to the right place at the right time.
• Analyze cover price. Assess the benefits on sales from a lower cover price, or improved sales with a higher price and a “printed on recycled paper” logo.
• Examine paper options. Investigate production changes that can save paper expenses and improve the environmental marketing of the publication.
• Explore environmental promotions. Demonstrating environmental leadership can get magazines highly visible placement on promotional racks in retail stores like Barnes and Noble, Hastings Entertainment, and Universal News and also within a special menu option on Amazon.com under “Recycled Paper Magazines.”
Everyone knows it’s an extremely tough time for the magazine industry. The good news is that while the solutions may require some thinking and a new approach, they do, in fact, exist. The question is, will enough magazines begin exploring these opportunities in time?
Four Magazine Widgets To Watch
Widgets, portable chunks of online code that can be installed and executed within any HTML-based Web page, have become ubiquitous with magazine sites over the last few years. From exercise calendars to fashion finders and investment calculators, publishers are getting creative with widgets to bolster the user experience and time spent on their sites.
While a new widget is born every day—and there’s no shortage of copycats—some publishers have created original and innovative tools to engage their users. Here, Folio: takes a deep-dive into a few that are working.

Celebrity Meter Widget
Publisher: Wired.com
With a need to always be ahead of the curve when it comes to cool technologies, last year Wired.com created The Wired Celebrity Meter widget, culling a series of external services and APIs to arrive at an estimate of a person’s reputation or “fame status” online. Receiving thousands of page views to date, according to Wired.com’s technology manager Paul Fisher, a large part of its success has stemmed from the “embed” feature, allowing users to easily embed it within any site or blog. It has also “baked-in” several default, online celebrities as widget options to be used as a point of comparison.

Deep Dive Content Widget
Publisher: F+W Media
Developed with Impelsys’ iPublishCentral, F+W’s deep dive widget is used across the company’s eCommerce stores. “We are nearly complete with our first batch of 1,000 widgets, with a total of 3,000 book and magazine titles anticipated in 2009,” says F+W Media president Sara Domville. The same widget is used to drive traffic by appearing in blogs, social media sites, articles and promotional marketing. “We pay a per title, per month fee for each widget at a negotiated rate,” she says. While there is no revenue share for F+W, there is a cost to the publisher for the creation of the material for each widget —PDF’s and digital content must be put in the proper format and include the appropriate front and back matter of the publication. The majority of use is focused on enhancing direct-to-consumer sales in eCommerce stores.
Q+A Poll Creator
Publisher: SodaHead.com
Social networking site SodaHead has created a question-and-answer widget. Users can take questions from the site and create their own polls based on those questions and put it on their own blogs or profiles. Media outlets like Technorati, The New York Post and ABCNews.com have adopted this widget to feature SodaHead-generated polls on their sites.

Scavenger Hunt Widget
Publisher: Cafemom.com
Cafemom.com, a social network targeting new moms, created a stir with its laundry scavenger hunt widget. The game focuses on who can do the most loads of laundry the fastest with a tiny, moveable bleach bottle. Originally created as a widget for sponsor Clorox, it grew to have an unanticipated following. “We had tens of thousands of moms playing this game with each other—the brand was in the game experience,” says Laura Fortner, senior vice president of marketing and insights for Cafemom.com. “There was even a group that had thousands of members.”

SIDEBAR
App-tastic Options
Test these magazine apps out now, free to download at the iTunes App Store.

Epicurious’ Recipes & Shopping List: On the Go and In the Kitchen
Publisher: Condé Nast
Function: An intelligent recipe and shopping list for users featuring 25,000 pro recipes, and a toggle between shopping and cooking formats.

Intelligent Investing
Publisher: Forbes.com
Function: Investment philosophies, global economics, Steve Forbes video series and quotes.

Seventeen’s Fashion Finder
Publisher: Hearst
Function: Aimed at teenage girls, this app enables shoppers to search for fashion products by look, item, brand, cover-star picks and price. This past August, it secured the top spot in the iPhone App Store, notching 135,000 downloads.
‘Worst of Times are Best of Times to Launch Magazines’
While new magazine launches were few and far between in the first half of 2009, the second half looks more promising. One notable story in recent weeks was the launch of experiential travel magazine Afar. The San Francisco-based title’s 96-page premier issue hit newsstands on August 18 with 35 advertisers, many of which hailed from the high-end and luxury markets.
But Afar, while arguably one of the more high-profile launches so far this year, only scratches the surface of a wave of emerging magazines. In August, there was a flurry of launch announcements for print titles. Early numbers pegged the tally at 75, according to University of Mississippi professor Samir “Mr. Magazine” Husni, who tracks magazine launches. That’s more than double the amount of launches in August last year (48) and higher than in August 2007 (61).

Roll Call
The launch announcements continued to roll into early September. Emmaus, Pennsylvania-based Rodale Inc. said it was planning to extend its Men’s Health and Women’s Health brands by launching a title called Children’s Health. The special newsstand-only issue, which will carry an initial print run of 750,000, hit store shelves on September 15. The 112-page issue carried a $5.99 cover price and featured 15 advertising pages.
Rodale is said to be taking a “try-it-and-see” approach with Children’s Health, indicating that Rodale does not necessarily have specific plans to publish the magazine regularly.
Meanwhile, American Media Inc. announced a partnership with Ultimate Fighting Championship to formally launch a bi-monthly national magazine called UFC. AMI had produced a commemorative issue for UFC that it said “outperformed all expectations from advertiser reception to newsstand sales.” The magazine is expected to hit newsstands in November.
“The UFC is the fastest-growing sport in the country with men 18 to 34 years old,” says AMI CEO David Pecker. “We were the first mainstream publisher to recognize the sport and feature their fighters on our covers which, by the way, resulted in many of our best selling issues on the newsstand. And the fact is that the premiere issue of the UFC was oversold for advertising—ad pages were 51 percent better than budget. That’s a pretty good indicator that the ad community buys into the concept.”
While details of the digital side of the initiative are being worked out, Pecker says the magazine will have a dedicated presence on UFC’s main Web site and that UFC is “definitely” considering mobile applications as part of its overall plan, too.

New Titles, Large and Small
Regional publisher 944 Media will launch editions in Atlanta and Detroit in October (although it was shutting down Six Degrees, a monthly culture and style magazine it acquired this spring, in those cities). Kevin Thomas, publisher of Maine Home & Design, relaunched Port City Life as Maine in August.
Expanding its portfolio of health and wellness magazines, MPA Media will launch Dynamic Chiropractic PracticeINSIGHTS in January. The monthly print title will carry a circulation of 40,000.
New business-to-buisness titles are popping up as well. Penton Media, which ceased publication of Metal Producing & Processing with the August issue, says it will launch Energy Efficiency & Technology. Targeting engineers who develop and use state-of-the-art energy systems, the trade title will carry a controlled circulation of 25,000 and publish three times in 2009 and six times in 2010.
Pricing Digital Editions: Finding the Sweet Spot
“Experience shows that consumers expect to pay less for digital editions,” wrote LCM Digital Media director Matt Hunter on Folio:’s social network mediaPRO. “As far as they’re concerned, there’s no print cost, no distribution charges and no retail margins to cover, so it should be cheaper.”
This is clearly indicative that some publishers are finding that the right content mix is coaxing readers to purchase digital back issues, annual subscriptions or commemorative issues. But is it possible to ballpark a price tag that will bring in funds and be agreeable to readers?

Setting the Price Tag
An annual print subscription to Playboy costs $15.96 ($12 plus $3.96 delivery), and is $12 in its digital format.
To determine what digital readers should pay, Phyllis Rotunno, president of Rotunno Circulation Management LLC, who handles Playboy’s digital editions, “looks at how the overall men’s magazine category prices their digital editions and my goal is to stay competitive.” A single print issue of Playboy is $5.99, while a digital single copy is priced at $4.99.
To create an appealing digital newsstand, Playboy.com includes promotional banners and buttons throughout its site for both the digital subscriptions and single copies on the Zinio newsstand, she says. During the initial launch, 40 percent of Playboy’s sales came from this newsstand.
O’Reilly Media’s do-it-yourself craft title, Make, offers three delivery options to its subscribers: print-only, print and digital, and digital-only. The magazine offers print-only or print and digital subscriptions for $34.95. Readers who opt for digital-only can expect a $26.95 subscription price—around 25 percent less than print. “Pricing for every format is set based on what subscribers and advertisers want and are willing to support,” says Make circulation director Heather Harmon.

A Digital Edition Value-Add
The 350,000-circ. digital-only women’s title VIVmag charges for its annual subscription; however, it recently reconsidered this pricing model. While “it will remain at $36,” says CMO Jeanniey Mullen, the digital edition subscription will now include a membership package. “Given that digital reading is so new, we wanted to make sure that the value proposition wasn’t something readers had to figure out (‘If Elle is only $12 subscription and this is $36…’); we didn’t want cost to come up in people’s minds as a main consideration.” VIVmag’s membership model will include reader invitations to exclusive advertiser and partner events, as well as e-mail access to the magazine’s editors.

Back Issues and One-Offs
Music magazine Spin doesn’t charge for digital issues but it recently produced a digital one-off custom publishing project in conjunction with its July issue. The digital-only retrospective on singer Prince included all of the content that the magazine had published over the past 25 years, as well as access to a tribute album. “Since it was a special issue with a big interactive feature, we priced it slightly higher,” says Nick Pandolfi, Spin’s digital edition manager. The digital retrospective, listed at $4.99, was Spin’s “first go” at paid digital editions, says Pandolfi. Due to its lack of a digital edition customer base on the Web, “we gave a 20 percent discount incentive,” Pandolfi adds.
Make allows access to its entire digital archive to subscribers who sign up for the Premier Maker program, which includes auto-renewal. “Since a few of our hottest back issues are sold out in print, this helps drive sales and encourage renewals,” says Harmon.
Playboy is capitalizing on back issues, with single digital issues at $4.99, single digital special editions at $7.99, and digital special edition back issues $9.99 each. Many publishers have found value in upping the price of their digital edition. Several years ago, Rotunno priced Playboy’s 50th anniversary issue at $25.00, selling nearly 2,000 digital editions. “Digital editions have definitely added to the bottom line,” she says. “The manufacturing and postage cost savings are significant.”
Will Second Half Single-Copy Sales Bounce Back?
There has hardly been a time in recent memory when magazine circulation has had to contend with such an unfriendly market. There have been increased production costs, economic pressures suffocating consumers and marketers alike—which, in turn, pinched circulation marketing budgets—and a near-total collapse of the newsstand supply chain. It’s practically good news that, according to the Audit Bureau of Circulations’ FAS-FAX report for the first half of 2009, subscription levels remained flat. Yet the real drama is a significant decline in newsstand sales.
There are small, late first-half signs, however, that newsstand numbers might be trending back up.
Overall, though, subscriptions for the 521 reporting titles were up about half a percentage point (.56 percent) during the first half of 2009, while single-copy sales fell 12 percent versus the same period last year.

Verified Circulation Drops
Verified circ, which had grown as a source for many of the big publishers last year, was down almost 4 percent.
Looking at the newsweeklies, Newsweek reported an 8 percent drop in paid subscriptions. Interestingly, its use of verified circ shot up 187 percent compared to same period last year. Time decreased its verified circulation by 88 percent and recorded a 2.6 percent spike in paid subscriptions. The Week remained flat with a .2 percent drop in paid subs and no reported verified use.
Out of the top 10 paid and verified circ gainers with more than 100,000 circ, six were below 500,000 circulation; seven below one million. Global Traveler topped the gainers with a 48 percent jump in paid and verified circ.

New Launches Not Making Up Ground
As a category, the top-selling 25 consumer magazines audited by ABC were all down, save one—Real Simple squeaked out a 1.17 percent gain on the newsstand. Family Circle dropped the most, 22.55 percent compared to first-half 2008.
That’s significant because those 25 titles account for almost 50 percent of the single-copy sales of all the magazines tracked on the newsstand by ABC. When best-sellers are down, the category itself is down.
Newsstand consultant Baird Davis also points out in his own analysis for Folio: sister publication Audience Development that the rash of magazine closings has also shocked the newsstand system: In the first half, a total of 62 audited publications, all of which reported newsstand sales in the first half of last year, were either closed or in some cases discontinued being audited by either of the two major audit bureaus. “In the aggregate these 62 discontinued titles accounted for over $65 million in retail sales in the year previous period,” says Davis.
He also notes that, normally, shutdowns are displaced by new launches. This year, however, revenues from the 26 newly-audited titles only managed $13 million. “The effect of such a disproportionately high number of discontinued titles in comparison to newly audited titles produced a net loss of 36 titles and a sales shortfall of 14 million units and $53 million in revenue,” Davis says.
This factor is not averaged into audit reports and Davis estimates that the effect is a further drop of 3 percent—bringing the total newsstand decline to 15 percent.
Among ABC’s top-ten single-copy gainers that sold more than 100,000 units, only one—Mother Earth News —broke a double-digit percentage, shooting up 29 percent. The next highest gainer was Women’s Health at almost 9 percent.
The six main celebrity titles—In Touch Weekly (-18 percent), Life & Style (-8 percent), OK! (-20 percent), People (-13 percent), Star (-14 percent) and Us (-3 percent)—were all notably down. However, the weeklies were particularly hard-hit when wholesaler Anderson News shut down in February, causing sales losses and delays for its 25 percent marketshare.
Fashion magazines didn’t fare much better, with Condé Nast’s W registering the biggest newsstand losses for the period, with single copy sales plunging 21 percent.

Large-Circulation Titles Make Rate Base
Despite the newsstand nosedive, the majority of big-circ. titles fulfilled their rate bases. Of the more than 30 magazines carrying rate bases of 2 million or higher—including AARP, Reader’s Digest, Maxim and Newsweek—only Playboy fell short, delivering a total paid and verified circ. of 2,453,266, compared to its 2.6 million rate base. A number of additional titles reported paid and verified increases through the first half. Among them were Women’s Health (29.7), Taste of Home Healthy Cooking (29.4), Body + Soul (12.1) and Everyday Food (10.4).

Newsstand Sales May Start Trending Up
A jump in unit sales and revenue late in the first half may be signaling a shift in momentum as we enter the second half of the year. According to MagNet, a data company that tracks store-level magazine sales, May and June were up 2.6 percent in units and 2.1 percent in revenue compared to the first four months of the year. In other words, the sales decline appears to be slowing down.
“These numbers indicate to me that May and June may have changed the momentum on the newsstand for magazine publishers,” says Ken Godshall, MPA’s executive vice president of consumer marketing. “That’s a change in direction from what we’ve seen in the last couple ABC periods and may be a sign of hope for the future.”
As the supply chain emerges from the rubble, it appears sales are on an upward trend. “The May-June period was down in 2008 versus the first four months, so last year we were losing traction and this year we’re gaining traction,” says Godshall.
Yet newsstand sales are only part of the story. The drop in sales received major play in the press to the consternation of the MPA, which responded by releasing a whitepaper in September called “The Full Story on Magazine Circulation Vitality.” Looking at the “big picture,” the report notes newsstand sales account for only 12 percent of total consumer magazine circulation and highlights other, more positive, takeaways: Subscriptions are up over same period last year, technology is helping to market subs more effectively, and magazine readership continues to grow—up about 5 percent from 2005.

SIDEBAR
BPA Worldwide Freezes Dues and Audit Rates
With b-to-b publishers facing significant ad revenue declines and a beat-up economy that continues to make forecasting difficult, BPA Worldwide’s board of directors has unanimously agreed to freeze audit rates and dues at July 2008 levels.
Indeed, ABM announced ad pages fell 30 percent through the first half of 2009, a factor that has publishers scrambling to manage costs. Subsequently, BPA’s phones began “ringing off the hook” early this year, says the audit firm’s president and CEO Glenn Hansen. “As those calls started coming in we were very sensitive to that as we put our budget together in January,” he says.
The freeze remains in effect until June 30, 2010, the end of BPA’s current fiscal year.
While BPA’s consumer counterpart, ABC, has effectively frozen dues and rates for its newspaper and magazine members since 2007, Hansen says this is the first time as president that he’s had to institute a rate freeze. “I’ve always been an advocate of raising dues and rates—at low percentages—each year, but this is the first time we’re not going to in the 10 years I’ve been president.”
Hansen adds that historically, under previous leadership, dues and audit rate freezes are followed by “huge” increases the following fiscal year. While there’s potential to hike rates in 2010, they won’t have to be dramatic because, says Hansen, of the way BPA is managing its costs this year.
The rate-freeze can be interpreted as both an effort to help publishers save costs and keep BPA’s membership active. There’s been story after story of publishers making significant cuts, and it’s not hard to imagine that audits are toward the top of the list.
Combine that with an increasingly complicated product platform mix that has some publishers arguing for greater flexibility in auditing metrics, and others implementing audits only when a competitive scenario dictates and you have unprecedented pressure placed on the audit market.
Questex Media, a large b-to-b publisher, left BPA in April for “nimbler” Verified Audit Circulation seeking a more flexible audit process. UBM’s TechInsights group left late last year to create its own in-house reporting system. And PennWell is now working with BPA on a brand audit report prototype, called Brand Reach Audit Report, to go beyond even its current integrated media report services.
In the meantime, BPA is touting its free Web measurement audit as an added value. “We continue to add more of our members into the BPA-Nielsen measurement tool, which is no additional cost,” says Hansen, who added that 22 percent of members are currently using the service.

Face Up

FaceUp: Associations Now
MAGSTATS
Issue: August 2009
Frequency: Monthly
Launched: October 2005
Circ: 22,500
Publishing Company: American Society of Association Executives & The Center for Association Leadership
Editor-in-Chief: Lisa Junker
Art Director: Beth Lower
Doodles and napkin Sketches are fun but do they work for a magazine cover design?
When Associations Now turned to illustrator Mike Rohde to create its August issue cover, they relinquished some creative control. “For a typical issue, we would hire an illustrator to create a cover concept that we brainstormed, or work directly with them,” says art director Beth Lower. But for this, Lower decided to bring on one of the illustrators referenced in Mark Athitakis’ cover story, “Do You Need Me to Draw You a Picture?”
After reviewing a number of portfolios, Lower chose Rohde based on his “use of type and the monochromatic aspect of it,” she says. While the magazine generally opts for color-intense covers, says Lower, every once in a while it breaks away from this; for example, with its November 2008 issue featuring an embossed Braille cover.
For the August cover, “We gave Mike [Rohde] two directions he could take the design: the first was to do something about visual thinking, and the second was to do a meta cover on what it would be like to create an Associations Now cover in sketchnote form,” says Lower. The two decided upon a visual thinking collage comprised of the tools and notes in sketchnote style.
The first step was for Rohde to sketch a rough pencil design, which he did in a Moleskine squared notebook. He then scanned it in and sent it to Lower for review. The next step was creating the cover in actual size on a sheet of heavy paper, laying out elements like the logo, headlines and table of contents. Producing the cover’s creamy background color in Photoshop was particularly tricky, Rohde says, as “it’s easy to lean too much toward yellow or red.”
As part of the magazine’s recent standardization, Lower considered keeping the mechanical (non-sketchnote) logo. However, afraid it would impact the design look, she ultimately opted for Rohde’s sketch. “I think it’s bold enough that everyone gets it,” she adds.

DESIGNER'S COMMENTS
“This cover, for all its complexity, is in reality far too simple. Defiantly archaic, there is little here that speaks to the present: black and white and without nary a nod to anything digital, this sketch feels like a blueprint for some far more fascinating image. It is busy to a point of distraction and while visual allusion as concept is good, this lacks old school charm: it simply looks dated. Typographically, the hand lettering overwhelms the concept leaving it without irony or intrigue.”
Randy Dunbar | Creative Director | RandyDunbar.com

“In the broadest sense, I think it’s a good idea and executed well. However, it’s trying to cover too much ground, and the lack of focus undermines what could have been a striking cover. I’ve had to wade through too many platitudes about erasers, Post-it notes, and redundant calls to action (I get it: it’s fun, and erasers are good). To focus on this ‘fun,’ they could have made a cool drawing as the focus of the cover; instead, I see pens and a pretty generic guy running. The biggest crime is the absence of color. Imagine a really fantastic doodle, of, say, butterflies or lightning bolts or even light bulbs—anything to convey the idea of imagination and inspiration—and imagine it in color. Even if they really wanted to be sticklers about the sketching, the colors could simply be highlighter colors (pink, yellow).”

Jason Treat | Art Director | The Atlantic

Best Practices

Five Paper Trends To Watch For 2010
Where Paper is concerned, it’s been an “interesting” 18 months in the magazine publishing industry. Just a little over a year ago, paper prices were just beginning to come off the “thank you sir, may I have another” increases that characterized most of 2007. In fact, if you recall, we were satisfied to just have paper for the next issue, never mind the price. My how things have changed in such a short time. The only good news that publishers have seen in 2009 is that paper prices have been driven down by over 20 percent from year-ago levels, possibly helping to keep a few publications afloat in this poor economy.

1) Mills Will Try to Raise Prices While Continuing to Limit Production
But what are prices doing now? Have they stabilized, or is there a possibility of another 2007 just around the corner? It appears that the free fall of paper prices has hit bottom, and for the first time in over a year there have been price increase announcements by paper manufacturers. Manufacturers are basing (blaming) the increases on increased costs for raw material (pulp) and energy. The increased input costs are legitimate, but as in most other businesses operating in a free market economy, prices are usually determined by supply and demand. Regarding demand, there has been an ever so slight uptick in orders, but to say there is even moderate demand now for printing and publishing papers would be erroneous.
On the supply side, paper manufacturers have been curtailing supply by temporarily shutting paper machines down to limit their production. This has been done across the breadth of paper grades and manufacturers. Additionally, some manufacturers have permanently shut down entire mills, with a great loss of jobs, all in an effort to remain profitable and frankly for some, remain in business. Sappi Papers, for instance, has announced the permanent closure of its Muskegon, MI facility. Sappi produces high quality stock for magazine covers and catalogs. Kruger Paper has announced they will no longer make coated groundwood paper, effective in October, at its Trois Rivieres facility in Quebec. Unfortunately for paper manufacturers, all the efforts to stem the tide of paper have not been enough to keep up with the decline of demand. Considering the still weak but somewhat increased demand for paper and the current overabundance of supply, it remains to be seen if the announced price increases will be able to be sustained, or if they will fall apart like other increases in the past that were not backed by a strong increase in demand.

2) Tax Credits for Paper Industry To End December 31, 2009
A significant factor in helping paper manufacturers stay afloat in these rough times has ironically been the federal government. By discovering an odd “loophole” in a government-backed environmental initiative, paper manufacturers have been able to reap enormous amounts of cash through the “Alternative Fuel Tax Credit” program. Manufactures such as International Paper have benefitted by over $1 billion. The paper industry has long used a by-product of the paper-making process called “black liquor” to help power their mills. Someone figured out that if the mills began blending small amounts of diesel fuel with the black liquor, they could qualify for the tax credits. A few in Congress have been outraged by this, because the use of black liquor has been a long and pre-existing practice by the paper industry. It is now anticipated to end December 31, 2009. Since many mills claim to be operating at or below “cash cost,” it will be interesting to see what happens. It will either result in more mills ceasing operations or prices rising.

3) Demand Will Rise
However bad the economy is now, demand, as always, will return. Magazine ad pages will come back; page counts and circulation will grow. For instance, as reported by FOLIO:, Hachette has recently announced major redesigns of some of its brands which include larger trim sizes and higher quality paper. And yes, even new titles will be launched, such as Rodale’s announcement of the new magazine, Children’s’ Health. When demand for publishing paper does return in earnest it bears watching what will happen to prices. Although some industry experts expect that demand for paper will not return as ferociously as it has in the past, they may not be taking into account how many capacity reductions there have been on the manufacturing side. As demand returns, prices will rise again quickly, and we could even see publishing-type paper in short supply as we did in 2007. Supply and demand conditions in the paper industry are seldom in balance. Conditions could be better characterized as either feast of famine for the mills. And when the mills are feasting, famine conditions for publishers are not far behind.

4) Paper Industry Is Now Sales Driven; New Products Are in the Pipeline
The paper industry has long been seen as “manufacturing” driven, instead of sales driven. The policy of “we’ll make what we like to manufacture best and let them buy it” has changed somewhat with the dire economic conditions facing the industry. Mills are increasingly listening to what their customers want and coming up with better products that bring value for the publisher.
One such product is SCA and SCA+. These grades are “Super-Calendared,” (SC) which means that they are “buffed” with an enormous cotton roll that makes it appear they have a coating like #5 coated groundwood paper. The “A” or “A+” indicates level of quality.
Although these grades are not new, their acceptance as an alternative to coated paper is growing. According to Rick Bortolotti, general manager for Times Printing Company in Random Lake, Wisconsin, “We’re seeing an increasing number of magazine publishers opt for SCA or SCA+. For the most part, we’ve had excellent results printing on these grades.”
It is important however to inquire with your printer about SCA grades, because not all have achieved the proficiency yet to achieve optimum results. Not only is the use of SCA increasing, but the number of mills adding an SCA and or SCA+ grade to their product mix is growing. NewPage Corporation has had such as product as well as the excellent “Radiance” sheet manufactured by Irving Paper. Now Verso has recently joined the group with its own SCA+ in their “Clarity” line of papers.
Other innovative papers continue to be offered by paper manufacturers including “alternative offset” paper that competes with the more expensive free sheet offerings from mills. These “alternative” products have groundwood content that makes them cheaper to produce and buy. To combat some of the low cost movements, some manufacturers are improving their products, such as Domtar’s announced enhancements to their “Husky” grade line in which brightness has improved to 94, opacity has been increased and the surface has been improved through better paper formation.

5) Environmentally-Friendly Options Will Continue To Grow
For those looking for an environmental option in paper, the timing couldn’t be better. Paper manufacturers across the board are adding recycled content to their grade lines in addition to third-party certifications. The third party certifications, such as FSC (Forest Stewardship Council) and SFI (Sustainable Forest Initiative) make certain that raw materials (trees and pulp) come from sustainable, well-managed forests. These certifications are more the “hot button” currently than even recycled content, although one can purchase an FSC or SFI grade that also contains recycled content. And the percentage of recycled content offered by manufacturers is increasing. In many cases, mills offer the option of 10, 20 or even 30 percent post-consumer recycled content in some of their paper types. For third party certification, expect to pay $1.00/cwt more. For recycled content, expect about one dollar for every 10 percent of recycled content.
For publishers, the options in paper are plentiful now as mills compete for your business. And the prices are right for most of these grades. But be mindful that as the economy begins to emerge from recession, prices will be on the rise, and paper could even become harder to come by.

Dan Walsh is vice president of publication papers for Chicago-based Bradner Smith & Company.

Columns

Have Publishers Lost the Capacity for Long-Term Planning?
Just a few years ago, all the talk was about implementing the three-legged stool strategy. Dubbed “the holy grail,” a publisher that offered advertisers a robust print, online and in-person solution, packaged together, would win.
The three legs of the stool…the answer to our problems. Publishers with the necessary resources developed the three-legged stool. Others tried new launches.
And now, after many publishers have struggled to make the stool model work, customers are spending their money elsewhere. Who knew there were plenty of other stool legs?
And then there was lead generation. Webinars. Podcasts. Virtual Trade Shows. And now social media. As Ted Bahr so eloquently stated at the Niche Magazine Conference just last April, “beware the fad of the year.”

The Next Big Idea
In FOLIO:’s “Big Idea” article in August, the lead paragraph states, “We all know that the top strategic priority this year isn’t really ‘online,’ or ‘lead gen’ or ‘events,’ it’s flat-out survival. Planning for the future now means the next fiscal quarter, not the next five years.”
This is exactly the problem. We are focused on short-term tactics, not strategy. We are focused on next month’s financials, not how to sustain and build the business for the long-term. A business does not prosper and grow because it can make the next quarter’s financial goals. It survives because it has a long-term vision, plan and strategy that engages all of its employees and resources in building great companies…in winning.

Short-Term vs. Long-Term
Peter Drucker, the great management guru, saw this coming when organizations started to focus less on the customer and more on where the CFO was looking. Corporations (publishers) were now to be managed exclusively to “maximize shareholder’s value.”
“This will not work,” Drucker said. “It forces the corporation to be managed for the shortest term. But that means damaging, if not destroying, the wealth-producing capacity of the business. It means decline, and fairly swift decline. Long-term results cannot be achieved by piling short-term results on short-term results. They should be achieved by balancing short-term and long-term needs and objectives.”
And boy, have we seen decline. And the spiral continues. The more revenue decline, the more focus on short term thinking (exclusively).

Correcting the Course
Changing from a short-term to a balanced short/long-term focus is really hard to do. Here are a few areas that will help you get there.
1. Sales Training. Yes, sales training. This is one of the reasons why publishers like Watt seem to be a step ahead. They have a passion for educating their salespeople, not so they understand how to pitch a product (which is important), but what questions to ask so that they can be better consultants, and form better relationships with their customers. The “advertising space rep” of the past is simply not equipped to succeed in this new, highly complex and varied communication world.
2. Expand the T&E budget. Now, more than ever, we need to see our customers face-to-face. It’s almost impossible to develop a relationship with customers as publishers without seeing them in person. If we want to understand where customers are going, and thus where business is heading, get face time with customers on their turf. It’s a heck of a lot cheaper now than it was at this time last year. When was the last time any of us heard of a publishing CEO visiting his key customers and asking how they were planning for the future?
3. Marketing. What, publishers actually marketing outside their own products? Unheard of in most media companies, but more important than ever, especially when there’s more competition than ever. If your customers are going to see you as their trusted marketing provider you need to be communicating with more than your sales rep. An easy start is a consistent (at least monthly) e-newsletter from your reps to your customers. Tell them how to grow their business, how to market smarter…and they’ll reward you with more business. Practice what you are preaching to your customers.
Selling Webinar Sponsorships in a Crisis Economy
Forced to cut budgets in a crisis economy, smart marketers are turning to selling products and services via Webinars. Because they offer educational content without the hassle and cost of live seminars, Webinars are popular with both attendees and marketers who want to bring in new clients, lessen attrition and build market share. As ad pages and show attendance dwindles, Webinar sponsorships are a win all around.
What’s more, publishing, online and event companies are ideal Webinar producers. They reach a loyal audience, add journalistic credibility and offer sponsors numerous promotional opportunities. Depending on company policies, advertisers can choose to control, contribute to, or simply sponsor a relevant Webinar. They can also choose a solo sponsorship or join with other noncompetitive advertisers to sponsor a Webinar. Either way, advertisers reach thousands of targeted, involved viewers with relevant and comprehensive information.
Yielding strong results with less time and marketing effort, sponsorships have been a hit with corporate marketers. According to a study by sponsorship marketing firm Performance Research for IEG, Inc., “the average share of overall marketing budgets captured by sponsors has hit a record high of 19.5 percent [of marketing dollars].” A recent Forrest Research and Marketing Professionals study adds: “Webinars are considered one of the top three lead-generating tactics.”
One recent Webinar sponsor I spoke with recognized the strong match between its product, Webinar topic, and audience the media company delivers. He described the event as a “grand slam”—the most successful provider of qualified leads and the best ROI marketing effort in months. Adding to these measurable benefits, the company recognized the branding opportunity and positioning of the company as a “thought leader.”
So, how do you get in on the game and win? Here, some guidelines to make the most of your Webinar:

1. Build in sufficient lead time. Promoting your Webinar well in advance can create opportunities for viral marketing and additional registrations. Remind the sponsor to promote it to their own client and prospect list.

2. Provide lots of promotional opportunities for pre-, post- and live exposure such as:
• Linked logos in outbound e-mail efforts (starting six weeks before event)
• Branded registration, log-in pages and opening slide for Webinar
• Branded registration confirmation e-mail
• Logo and sponsor message with 60-second voiceover at beginning of Webinar and/or a short demo at the end of the webinar
• Logo and link in final slide of Webinar
• Opt-in checkbox for those who want to receive sponsor’s e-newsletters
• Access to the registration list

3. Create customized content. Webinar registration forms, for example, can provide sponsors with custom-created questions about demographics and decision-making ability, enabling them to target promotions specifically to the audience.

4. Allow downloading opportunities. You’ll get attendees by offering a login and password for a downloadable handout. At a Webinar I recently produced and conducted, the downloaded handouts comprised 25 percent more than the attendee rate, which translates into greater ROI for the sponsor. It also indicated that several people were watching the Webinar on a single computer.

5. When it’s over, archive your Webinar. You’ll get additional viewers, giving sponsors more exposure and longer-lasting bang for their buck. Send monthly reminder e-mails to both registered non-participants and to non-registered audience. Naturally, each reminder should include the sponsor’s link and promotional message.

6. Let your sponsor help spread the success. Testimonials and statistics from satisfied sponsors help sell other advertisers on the marketing advantages of Webinars.

7. Take advantage of SEO marketing. Write your promotion copy to be search-engine friendly, incorporating key-words to help Google and Yahoo find you. Get other online media to post your press release on their Web site to multiply your visibility on the search engines.

Helen Berman is president of Berman Media Sales Institute.

Features

For Print to Survive, You Must Automate!
The media landscape has radically and permanently changed. And, a publisher’s normal means of bringing expenses in line with revenues is no longer enough.
What publishers are missing is the right process automation software for magazine production (including all affected departments). That means using two-way, real-time integration between departmental systems and even your printer or standalone modules in the event that one or more departments do not have their own management information systems.
This is an approach that can enable increased revenues through target marketing of readership (and its advertisers) while bringing significant reductions in both magazine operations overhead and manufacturing and distribution (M&D) expenses through your printer.
Depending on how completely the system is implemented, the more you can leverage the software, the better the results will be for the company.

Where to Start: The Map
Your core process automation application needs to be an electronic version of the magazine map. The map can then become the hub for a central operations database for overall process automation, two-way real-time integration of internal magazine operations and with your printer, and vastly improved communications. Besides the map, the production software also can cover:

(1) Production schedules that also include complete yet automated tracking of content, components and materials; including timely alerts of impending deadlines, schedule conflicts or missing materials.

(2) The map’s interface to the software’s print contract management module provides for manufacturing and distribution cost optimization (including geo/demo) while mapping; as well as separate functionality (e.g., M&D budgets for accounting).

(3) Exporting the final issue plan’s M&D requirements to the printer can comprise much of the printer’s input for issue specifications; in turn, bringing the likelihood of shared savings by the printer to the publisher for offering the data feed.

(4) If you don’t already have sufficient software systems for enabling process automation for advertising, editorial and circulation management, the software must still possess the abilities to provide a complete ad booking system as well as meet other departmental needs as covered herein.

Target Marketing is the Answer to a Niche Marketplace
The printed magazine that performs well today is likely covering a niche. Even with a more general interest publication, you can accommodate selective content for readers and niche advertisers through target marketing to your magazine’s readers by covering content of particular interest to that reader.
Today’s map-based software achieves target marketing through geo/demo M&D optimization to minimize time and mistakes. In addition, it realizes the least M&D expense through cost optimization, such as selective binding, including optimization for the USPS to realize the lowest postal rates.
Such software must minimally meet the following requirements:

• The software must be both easy to use and complete. For example, where other departmental systems do not exist, the software offers standalone-modules. The software even offers Excel file exchange where useful, while providing timely, user-definable and general system alerts and flags to impacted parties in the event of violation of content placement (including locked content), schedule deadlines, or other irregularities.
• The software should provide remote access through your Web browser to the map and related software modules.
• The software needs to provide a user-customizable report generator to complement the map and other production modules: e.g., (1) for screen or print-out display (including PDFs) of the map and its variations (e.g., S/S ladder); (2) provide for user-definable reports including production schedules and M&D budgets and estimates; (3) automatically output the issue plan and its pre-bill for sending to the printer in the file format the printer requires; and (4) for accounting, the final invoice can be automatically broken out to meet the publisher’s chart of accounts. There should also be quick access to custom and standard reports by category; even allowing fast on-screen queries.
In cases where there is limited or no content management systems, the software can even provide databases covering editorial/art requirements such as contributor databases for writers and art contributors including their specialties, contact information and contribution history and Web sites for stock digital assets for download. For digital asset management, the software should provide a current and historical database of specific in-house or printer-based digital assets and their file location for picking up ads for repeat insertions as well as editorial reprints.
You should also be able to track production schedules by issue and the fiscal or calendar year, by magazine or magazine group and by magazine issue.
Software should be able to create schedules customizable for meeting operational requirements. It should also continually monitor and alert the user to overall issue production status including their ongoing materials status, to ensure that all aspects of issue production are running on-time and otherwise ready for print. It can also catch overlapping schedule conflicts to minimize the possibility of running late.
Incorporating a complete printing M&D cost optimization module including geo/gmo makeup is capable of providing:

(1) estimates and forecasts (and updates) for accounting’s annual budget;

(2) the ongoing cost of a magazine issue’s M&D expenses—even while developing the map—to determine the cost of expanding page count for an ad added at the last minute;

(3) ongoing verification that the issue plan can be produced by the printer, while ensuring that you are billed correctly according to your M&D pre-bill with the issue plan.

Circulation and distribution modules are also included covering newsstand and subscriber copies, as well as miscellaneous shipments such as show copies. They work with the cost optimization module to optimize for the lowest postal costs, even geo/demo cost optimization.
A complete rights management system can create logins and passwords by user and by workgroup and stay attuned to their specific access needs as read-only and create, change and delete in terms of magazine workflow requirements. Users can even simultaneously work on the same job while the system prevents overwriting other data.

Software Features
The software should also offer continuous upgrades with 24/7 maintenance/support, which overall is critical to not only continuously improving the product, but even more so for improving time savings and error-free issue plans.
Map software needs to be fast and easy for the user placing content by using drag-and-drop or with a combination of mouse, keyboard and object menus. For example, the map should enable the user to quickly drill down or roll up for geo/demo sections and pages. Only a few measurements must be entered to reserve space for anticipated ads.
In turn, the map must be easy to differentiate content elements by providing user-customizable page or other display options (e.g., an advertorial or geo/demo version). This is achieved through user-definable use of color, icons and other markers.
You need to be able to access map revision history that can enable you to not only review the development of the map, but also pick up recent revisions to eliminate changes that are no longer true.
The software should even include a classified ad module to provide for entry/import along with automatic composition of classified ads by section or other criteria.
The software must accommodate a user-customizable visual map including alternate views such as complete or selective view of metadata vs. page images. The map can be displayed either as the complete issue map or by section or other component, as well as by geo/demo version. It can also provide press form impositions for correcting placement to avoid inline color conflicts on-press and other user-definable views, such as on-screen queries.
The map must be able to accommodate all forms of content and their placement requirements, including: advertorials or other special sections; user-definable ad/edit sizes/shapes and standard or unique fractional ad placement; user-definable rules-based ad placement, including by competitive ad market as well as providing for competitive ad rotation from issue-to-issue.

Managing Advertising
For competitive ad placement, ads can be assigned ad market categories to accommodate the Publishers Information Bureau (PIB) categories, and enable you to customize for your magazine’s own competitive ad market categories. The publisher can transmit electronic reports after issue to PIB and other organizations.
To set up each issue map, you can make use of magazine templates or issue job cloning to avoid issue-to-issue repetitive entry. And you also can set issue page count from either a targeted ad/edit ratio, minimum editorial page count, or both.
Two-way interfaces to Quark Xpress and Adobe InDesign from the map save time by automatically producing then exporting back to Xpress/InDesign fully composed pages from your mapping software for any template-driven page content (including ads), relieving the art director of tedious follow-through.

A Huge Return on Investment
A product that meets the general requirements herein can provide the appropriate (and verifiable) ROI to senior management.
For example, you might even be able to use your printer as an applications service provider (ASP) wherein you are granted login rights in order to safely access the printer’s hosting server and pay a reasonable monthly fee in return.
Through accommodating work-share programs such as PAGE Certification with the USPS, process automation can help to significantly reduce the expense of postage as well as reduce clerical handling by your staff and by the printer.
Ease of use, along with process automation, are key deliverables. After the original setup, each magazine issue develops much more quickly and with fewer errors.
The software can accommodate the most common architecture along with availability of state-of-the-art database systems like MS-SQL, Oracle and others.
Process automation is the most effective solution to retaining your printed magazine The tools are here today. Use them!

Bert N. Langford is U.S. technical representative and advisor for dataplan GmbH. He has comprehensive experience in printing and publishing, as well as consulting for magazine publishers. Bert can be reached at blangford@dataplan.de.

Publishing Technology

An Enterprise Evolution
Digital asset management (DAM), a process in which a secure central repository helps streamline the creation, management and monetization of digital assets, is one that publishers are continuing to adopt even in a down market. With origins in prepress and production services, DAM aims to integrate asset management and production seamlessly, particularly while working with design programs Quark and InDesign.
“The greatest asset is that it dramatically improves organization, task automation, and content repurposing,” says Jeremy Carlson, Advanstar’s manager of digital prepress, digital imaging and media operations, “which ultimately should equate to any publisher’s bottom line of reducing labor costs associated with asset trafficking, reducing design cycle time, and increasing revenue by simplifying the content repurposing process.”

Bringing It In-House
The pros of a DAM system are such that publishers even seem to be bringing systems in-house “rather than sending out this work as a way to reduce the time to press,” says DAM vendor Xinet CEO Scott Seebass. With hardware requirements becoming significantly less expensive, “there is no longer a huge barrier of investment to doing it yourself,” he adds. Implementing a DAM could even be a savings measure for publishers, although most likely won’t see savings in the first year.
Historically, weeklies have been avid DAM adopters due to their need to quickly process and track huge amounts of photos. “This market pushes the limits of technology amazingly, since it’s all about who can get their magazine out first,” says Seebass. And now, in addition to weeklies, a number of other publishers that are integrating user generated submissions and content into their offerings are also opting for DAM.
When Advanstar purchased its system in 2002 through Xinet, it was used mainly as a tape archiving system. True implementation didn’t come until 2006, when they discovered and expanded the full functionality to serve company-wide across all of editorial locations. But before implementation, Carlson explored a number of key company considerations:

1. Ease of integration with the prepress systems. Does it dovetail with our design application?
2. Is the cost structure designed at an enterprise level, or per seat licensing?
3. Will a system integrator support both our DAM and other prepress systems under one umbrella?
4. Does it follow open standards allowing customization, or is it proprietary?
5. How far can we push the automation as to save staff from doing repetitive tasks?
6. Is it platform neutral?

Advanstar’s system now houses XMP metadata, image tracking, a low resolution FPO/OPI workflow, a centralized image repository, as well as a self-serve Web portal for external downloads for content repurposing.

Digital’s Backbone
New to the scene is F+W Media, which began DAM implementation around 18 months ago with vendor Mark Logic. “It is not a single build, but rather an evolutionary process based on different types of content we offer, the ways in which we deliver that content, digitally, and the different businesses we wish to enter,” says John Lerner, executive vice president of e-media. “We really looked at the business plans for the new products, and revenue that we could generate from our content, and then looked at the platforms that would enable us to get there,” he says.
They anticipate their DAM to be the backbone for new digital products. “We recently launched a report service on OldCarsWeekly.com that leverages our archived content and pricing data to generate unique reports on Old Cars that includes photos, car features, values based on car condition and recent auction prices realized,” says Lerner. “As we continue to update this content through DAM, we will continue to grow the online service and we are now able to create new print products based on the reports generated.” F+W Media plans to use its system as a tool to innovate digitally while leveraging both archive and current content.

Expanding Archived Content
An early adopter, Rodale implemented its full DAM in October 2005 with vendor North Plains’ Telescope. But prior to this, Rodale relied on “internal systems to manage some components of our content as a work around,” says publishing systems manager Sandie Roberts.
In addition to housing six years of books and magazine archives, its DAM system includes all design files, images, extracted text, multiple resolutions of the PDF for the full product, correction information for reprints and various other formats. It has a “recipe repository that captures recipes from our printed products, as well as ones submitted through our online tools, with over 10,000 recipes with a rich metadata model,” says Roberts. It also includes article abstracts, original content prepared by staff librarians, and an image repository of photo shoot outtakes.

Enterprise Is the Future
For his part, Carlson would like to see DAM integrate on an enterprise level with other publishing systems. “This way, our ad booking system can identify incoming ad materials submitted through our ad portal, then relay that information to our DAM, which could then submit to our prepress workflow system and finally flow into a folio system (used for ad/edit mapping) for print, and a CMS system for Web.” While this is currently possible with Advanstar’s DAM and by using XML/metadata, “It’s just a matter of investment in system customization to fit the pieces together,” he says.
Improvement in the rights management arena is key for Roberts, as is the ability to link that information to the appropriate assets. “This is an area that is getting more complex and publishers need a tool to capture and manage all the possible rights scenarios for a product and its related assets. We’re looking at workflow tools to streamline the production process.”

Reality Check

Has the Marketing Pendulum Swung Too Far to Paid Search?
Whether Google is friend or foe, the clear fact is many publishers have seen marketing clients divert significant dollars away from their print, online and event products and toward paid search programs. After all, it’s cheaper, SEO experts typically tell brands to buy their name and Google is how everyone finds things online, right?
Well, yes and no. A look at the traffic drivers for select consumer and b-to-b marketers through Compete.com shows that almost without exception, Google is the top referring site to the marketer’s homepage. However, for many sites, that’s due to users entering branding terms (like the company’s name) into Google search even if they know the brand’s URL because it’s quicker than typing it into the browser. Often, organic search seems to drive more traffic than paid search. In other words, many marketers are paying for searches they would get anyway, thanks to existing brand awareness.

Case By Case
Let’s start by taking a look at the kitchen and bath fixtures category, which includes a mix of b-to-b and b-to-c marketers. Kohler.com boasted 75,765 visitors in August 2009, according to Compete.com. Top search terms included “Kohler,” “Kohler faucets,” “Kohler toilets,” and “Kohler trim.” Top referral sites include Google, Yahoo!, kohlernews.com and bing.com. The organic search term “Kohler” accounted for 23.46 percent of the site’s total traffic from search.
Meanwhile, paid clickthroughs accounted for 6.42 percent of Kohler’s August traffic—more than the second best performing search term “Kohler faucets” (which accounted for 4.75 of traffic), but still well behind the top organic search term.
Competitor Delta Faucet saw 125,090 unique visitors in August, with the organic search term “delta faucets” driving 33.53 percent of traffic. However, Delta also showed a substantially higher return on paid search, with the term “deltafaucet.com” driving 19.02 percent of traffic.
Looking at a broad consumer category like golf equipment, Calloway.com saw 37.7 percent of its traffic from organic search and 20.5 percent from paid search in August, while Ping.com saw 34.8 percent from organic search and just 2.3 percent from paid search.
One could reason that search results for Calloway are brand related while search results for Kohler competitors are more brand generic.“I’ll argue that some brands like Calloway are paying for traffic that they would likely get anyway and others (like Kohler) are likely being outspent by their competition and may be losing some sales opportunities,” says Stephen Davis, vice president and group publisher of data provider SRDS (a sister company to Compete.com).

When Paid Search Comes Through
Of course, organic search doesn’t always trump paid search. Online mortgage company QuickenLoan.com derived 44.5 of its traffic from paid search.
“I think certain categories are more prone to gaining audience via paid search than others (travel, mortgages, catalogue shopping),” says Davis. “So the percent of overall traffic is better compared to their competitive set than to other norms. All marketers try to win the organic search game but you need relative content, a great audience and link partnership to beat the algorithms.”

Sales

Outsourcing Sales: If You Are Considering It, Can Your Organization Handle It?
Today, outsourcing ad sales is getting to be more prevalent. Heads of magazine companies are running out of options due to constant or rising sales expenses combined with lower revenues. To many, outsourcing all or some of the sales function may seem an unacceptable option, but it doesn’t have to be viewed that way. Publishers have lots of different choices and ways in which they can structure their arrangements.
When a publisher outsources sales, there has to be a clear understanding of what choices exist. One size doesn’t fit all situations. Too often, decisions are based on former relationships.
There are two major factors that any publishing organization should consider before outsourcing their advertising sales. The first is whether or not the publisher can, in fact, sustain and nurture an ongoing independent relationship. The second is whether the rep firm selected can meet the needs of the publisher.

Are You Ready To Outsource?
The following are some things to examine before initiating a search for an outsourcing partner:

• Are ALL of the key players willing to work with an outsourced sales operation? It will be difficult if a middle manager, who wants his own sales staff, is forced to manage something he doesn’t want.
• Are there hidden agendas that conflict with the outsourcing model?
• Is senior management willing to monitor this process and be accessible if problems arise?
• Is the publisher willing to accept a different work culture?
• Are all the real costs included in evaluating a direct sales operation?
• Have the expectations been clearly defined from both a strategic and tactical standpoint?
From my perspective, the biggest single thing that a publisher can do to assure failure is to outsource expense without any real commitment to outsourcing the whole process whether regionally or nationally.

Choosing Your Outsourcing Partner
After the decision to go ahead with a rep firm has been made, the selection process begins. Now to figure out which firms can meet a publisher’s needs. The questions of big vs. small, national vs. regional, process-oriented vs. free-wheeling, vertical vs. horizontal and experience in electronic media all must come into play.
The question of big vs. small is interesting. Bigger firms tend to be more systems-oriented and have their own culture. They also tend to have much better databases and the ability to leverage existing business.
With smaller firms, the owner may personally sell the property. Sometimes, if a smaller firm does not have growth plans, the whole operation can be identified with a particular publisher.
Some publishers may need national independent representation, others regional. National firms can provide centralized billing, strategy, management, research and some marketing continuity. But if an organization retains an ad manager who also wants or needs control, then a big company may not be a good option.
Some firms are vertically-oriented, meaning that they will assign magazines to salespeople, limiting the number of titles each salesperson handles. Horizontally organized firms assign a territory to each salesperson, and expect that salesperson to sell all of the firm’s titles. For mature magazines with a limited number of accounts, this model is certainly appropriate. Vertically organized firms assign properties to sellers often exclusively. This model may be more suitable for more robust multi-media offerings or organizations used to the direct model.
A complete checklist of items to consider in hiring an independent sales organization can be found in the April 2008 issue of FOLIO: and on our Web site.

Jim Elliott is president of James G. Elliott Co., Inc., an independent media sales firm which includes marketing and research services. He can be reached at j.elliott@jamesgelliott.com.

September 2009

Dan Trombetto — Thu, 27 Aug 2009 11:02:33 -0400

Cover Story

E-Media Reality Check
Digital is the priority for most publishers, yet many executives have had to re-adjust their e-media forecasts just as they did with more traditional revenue streams such as print and events. Online ad spending in the U.S. dropped 5 percent to $5.5 billion in the first quarter of 2009 and 7 percent to $6.2 billion in the second quarter, according to market analyst IDC.
Digital revenue remains relatively small, despite massive percentage growth in recent years (and massive slumps in traditional revenue streams). “Those who have been aggressively pursuing digital will likely see it between 8 percent and 15 percent of the overall revenue mix,” Deborah Esayian, co-president of Emmis Interactive told FOLIO: recently.

And while many publishers vow they will “never be dependent on print advertising again,” just how well are they following through on that promise? FOLIO:’s 2009 E-Media Survey asks publishers where their biggest e-media successes (and set-backs) are coming from.
Big Growth in Last Five Years
While the industry may still be falling short of where it should be when it comes to digital media, the revenue ratio has shifted dramatically in the last five years. Eighty-seven percent of respondents say they generated less than 10 percent of their overall revenue from e-media in 2004. In 2009, just 50 percent of those same respondents say they see 10 percent or less of overall revenue from e-media [Chart 4].

Eighteen percent of respondents say they generate 10 percent to 15 percent of total revenue from e-media (compared to 6 percent in 2004), while 16 percent say they generate 15 percent to 20 percent of total revenue from e-media, compared to just 2 percent in 2004.

Meanwhile, 6 percent say they see between 20 percent and 30 percent from digital revenue, up from 1 percent in 2004, and a surprising 11 percent say they see more than 30 percent in digital revenue in 2009, compared to 4 percent in 2004.
Earlier this year, Advertising Age estimated 2008 e-media advertising revenue for 11 of the leading consumer magazine publishers. Martha Stewart Living Omnimedia came out on top, with digital estimated at $14 million, or 12 percent of total advertising revenue. Time Inc. and Hachette tied for second with e-media estimated at 10 percent of total revenue.

However, digital revenue for giants such as American Express Publishing and Condé Nast was estimated at 4 percent and 3 percent of total revenue, respectively, while Bauer was estimated to have zero digital revenue in 2008.
“Saying we’re going to migrate consumers one-to-one, print to online, is naive,” Hearst digital manager Chuck Cordray told FOLIO:. “Customers will choose what they want to do. As publishers, we have to decide if we are going to compete in that media and succeed. Whatever happens in the traditional magazine business, we have to compete in digital as a business.”
Reader’s Digest is attempting to change its perception as a legacy print brand by making SEO, social media and newsletter initiatives a priority. “That’s empowering our growth rather than spending $100 million on a big ad campaign,” says acting general manager Jonathon Hills.
Next up is transforming the Reader’s Digest brand into a multi-platform experience. “We’re focusing on video,” says Hills. “Much of our content is perfectly suited for it, and it’s highly monetizeable. We’ll see action with mobile this year on the iPhone.”

Smaller Publishers See Big Gains
While smaller publishers (those generating $5 million or less per year in total revenue) have historically lagged behind larger publishers when it comes to e-media as an overall percentage, they’re catching up and in many cases surpassing larger publishers (of course, when you’re smaller overall, it’s easier to change the revenue ratio).
As a publisher of five titles tied closely to the new home market in Orange County, California, Churm Media saw 20 percent of its revenue disappear over an 18-month period. As part of its response, Churm devoted $350,000 to Web development, including revamping Web sites and developing an aggressive newsletter strategy. In 2009, Churm expects 10 percent of its total revenue to come from digital. CEO Steve Churm says the company could be at 22 percent in 2010. “A year ago we were at 1 percent,” he says.
Meanwhile, Phoenix Media Network says its online revenue grew by 25 percent last year. Atlantic Media says digital revenue is growing 55 percent in 2009. And while Incisive Media says print makes up 70 percent of its business with events around 15 percent to 20 percent and online at 10 percent to 15 percent, the potential for digital growth is greater, particularly for data and paid content. “We’ve seen the end-user part of the business (data) and even subscriptions grow faster than the advertiser portion,” says CEO William Pollak.
As part of its Chapter 11 filing in August, Cygnus Business Media revealed that it expects interactive revenue to drop 14 percent to $8.6 million in 2009. By 2013, Cygnus forecasts overall revenue will be $75.5 million, with print accounting for 49.6 percent of total revenue, or $37.4 million. Events will account for 26 percent (compared to 15.4 percent of revenue in 2009), while interactive is forecast at $18.4 million or 24.4 percent of total revenue (up from 12.5 percent in 2009). In five years, print will remain the largest revenue stream accounting for nearly half of Cygnus’ total revenue.

Banners Reign in Revenue, Not Profit
While the buzz around mobile and social media dominates much of the digital conversation, banner advertising and e-newsletters remain the most prominent e-media revenue streams with 90 percent and 78 percent of survey respondents saying they derive revenue from these two sources [Chart 1]. Custom Webinars and online directories tied as the third most prominent products, offered by 36 percent of respondents.
However, several highly touted up-and-coming revenue streams remain fairly rare for magazine publishers. Only a quarter of survey respondents say they are currently seeing revenue from lead generation, while slightly more (28 percent) say they are seeing revenue from paid content (however, among those respondents who are offering paid content, 50 percent are seeing profit margins of 30 percent or more). Ten percent of respondents say they are seeing revenue from virtual events while just 6 percent are managing to drive revenue through social network sponsorships.
When it comes to the largest and smallest revenue streams [Chart 2], banner advertising remains on top, with 37 percent of respondents saying that’s their largest revenue stream. However, banner advertising was also cited as the least profitable e-media revenue stream, with 32 percent of respondents saying they see profit margins of less than 10 percent from banners.
E-newsletters (34 percent), Webinars (22 percent) and custom Webinars (19 percent) were also top earners.
That seems to mirror what online-only publishers are doing as well. Eighty-one percent of traditional publishers say the primary revenue model for their online-only competition is advertising, followed by lead generation and subscriptions. According to a FOLIO: survey earlier this year, 74 percent of publishers said they launched at least one online-only product within the last two years.
Meanwhile, companies such as GlobalSpec represent what publishers could be facing (and how they may want to structure themselves online). Originally positioned as a vertical search engine for the engineering market, GlobalSpec has evolved into a multi-format, multi-product model that includes databases and e-mail newsletters with more than $50 million in estimated revenue. “Our typical customer will spend between $10,000 and upwards of $1 million,” GlobalSpec CEO Jeff Killeen told FOLIO: recently. “We have many hundred thousand dollar-plus relationships.”
VIN (Veterinary Information Network) is another online-only publisher that is neither sponsorship nor advertising-based; it’s membership based, with 42,000 members paying $55 per month.
Hard Revenue Numbers
In 2008, FOLIO: surveyed readers on how much money they made from online media. At the time, 65 percent of publishers said they generated less than $500,000 in e-media revenue. In 2009, that number improved slightly, with 58 percent of respondents saying they generate less than $500,000 from e-media [Chart 3].
Still, in an industry used to individual magazines and events generating more than that, e-media is still a very small part of the overall plan. Thirteen percent of respondents say they expect to generate between $500,000 and $1 million in 2009, up from 10 percent in 2008. Sixteen percent say they generate between $1 million and $3 million (up from 9 percent last year) and 13 percent say they do $3 million and up. (No respondents say they are generating more than $50 million per year in digital revenue, although 1 percent says they generate between $20 million and $50 million).
When compared to the last five years, the outlook indicates steady improvement. Seventy-eight percent of respondents report they generated less than $500,000 in e-media revenue in 2004. Nine percent generated $500,000 to $1 million, while the percentage of respondents generating $1 million to $3 million in revenue doubled over the last five years, from 8 percent to 16 percent.

Most See Profit Margins of 10 Percent
Despite favorable comparisons to the profitability of print, the majority of respondents—40 percent—said their e-media business has a profit margin of 10 percent or less [Chart 6]. Thirty-four percent say they have a profit margin of 20 percent or more, while 16 percent see profitability of 10 percent to 15 percent. Eleven percent see profitability of 16 percent to 20 percent.

Digital Investment: Most Under $100K
While publishers often cite the lower costs and higher margins associated with digital media versus print, building a digital business requires significant investment in hardware, services and personnel. According to FOLIO:’s 2009 B-to-B CEO survey, e-media accounted for the largest operating expense increase among b-to-b publishers in 2008, up 6 percent.
Still, 51 percent of respondents to FOLIO:’s E-media Survey say they invested less than $100,000 in e-media products, services or personnel in 2008 [Chart 5]. Twenty-four percent say they invested between $100,000 and $300,000, while 12 percent say they invested $300,000 to $500,000.
Five percent invested $500,000 to $1 million and another 5 percent invested $1 million to $3 million. One percent invested $1 million to $5 million, while 2 percent invested more than $5 million.
Between open source solutions and existing staff taking on new responsibilities, many publishers are finding they don’t have to break the bank. In August 2006, the Web site for Reni Publishing’s Florida Real Estate Journal averaged 750 monthly unique visitors but after some basic tweaks and a $1,000 software investment, Reni had 50,000 unique visitors by the end of 2007.
Online startup Knitters Review, which sees an average of 2.8 million page views and revenue in the low six figures, says its biggest expense is hosting a forum of 70,000 members, which requires a lot of bandwidth and storage—and costs about 10 percent of Knitters Review’s total revenue.
On average, the majority of respondents (20 percent) spent between $10,000 and $24,999 on new technology last year (14 percent spent $100,000-$249,000, while just 2 percent spent $1 million or more).
“We were in a unique position in that our company wanted to do it right and as a startup told me not to worry about revenue the first year; worry about building the product,” says Jeff Higley, editorial director of digital media for HotelNewsNow.com. “For the actual costs of building the site itself, plus the back-end stuff, I would say the startup alone was about 70 percent of what it would have been for a print product from a start-up perspective.”

Staffing: As Silos Break Down, Everyone Works On Digital
In recent years, publishers have found that online staffers could command higher salaries than their equivalent counterparts in print. That’s starting to level out as digital skills become more commonplace (and as the separation between “print” and “digital” staffs crumble and one staff is responsible for everything).
According to the FOLIO: survey, 57 percent of respondents spent less than $100,000 on staff dedicated to e-media (indicating that while many publishers may have a dedicated e-media or newsletter editor, the entire staff is generating content for the Web). Twenty-two percent say they spent between $100,000 to $300,000 on a digital media staff, while 9 percent spent $300,000 to $500,000.
Many publishers have struggled with getting existing staffers to sell digital, since the commissions are typically smaller than print. However, 74 percent of respondents say their staff sells both print and digital, compared to 16 percent that have a dedicated e-media sales staff and 10 percent that outsource their digital sales.

ROI Dominates Reasons for Digital; Interaction with Clients Lags
According to the FOLIO: survey, 75 percent of e-media advertisers are existing accounts, while 25 percent are new business. Many have worried that online pricing started so low that publishers would have a hard time raising rates. However, 59 percent of respondents say that they have been able to raise the rates on e-media products.
When it comes to why they’re buying online media, the majority—52 percent—of publishers say their clients cite ROI/measurability and deeper business intelligence as the top reasons. Twenty-five percent of publishers say their clients are turning to e-media for lead generation, while 23 percent say it’s because of an accessible price point. Interestingly, just 5 percent of respondents say their advertisers cite the ability to interact with their audience via digital media.

Login

A Surge in Publishing Bankruptcies
With annual revenue of more than $2 billion, Reader’s Digest may be the largest magazine publisher ever to file for bankruptcy. But it probably won’t be the last this year. The private equity frenzy of the past decade, combined with the unprecedented downturn, has caught up with the industry.
So far in recent months, supplier companies including distributor Source Interlink and printer Quebecor World (now called World Color Press) have filed for protection, and publishers including Cygnus Business Media and the newspaper giant (and owner of Connecticut) Journal Register Co. have as well.
Summit Business Media is said to be in the process of addressing several leverage covenant issues in its bank lending agreement, with sources saying the company has experienced a technical or paperwork default with its covenants due to a drop in earnings rather than payment default issues. The publisher recently closed or sold off several business lines, including its Art Group and Executive Enterprise Institute.
Some publishing companies that have been at the top of their categories (or even remain so) are now financially troubled and facing speculation about their fate. One is the residential construction giant Hanley Wood, long considered one of the best-run companies in b-to-b media. Another is Advanstar Communications, which was acquired by Veronis Suhler Stevenson in 2007 for $1.1 billion and is saddled with several hundred million in debt. (Advanstar is no stranger to bankruptcy—it endured the process in the early nineties.)
To be clear, our sources suggested that these companies might be vulnerable to a dramatic restructuring, not necessarily bankruptcy. Hanley Wood CEO Frank Anton said the company is not considering a Chapter 11 filing, and Advanstar didn’t provide comment by press time.
“That big media companies with a lot of leverage are filing for protection is understandable right now,” says one financial observer. “When you start seeing pure strategic companies filing, that will be the bigger story. This fall should be interesting for the traditional media landscape. Few companies probably have NOT breached their covenants.”
Aspire Media CEO Clay Hall says there are some tell-tale signs for companies that might be in danger. “Companies that are not number one or number two in their markets are likely candidates for bankruptcy,” he says. “Companies that continue to operate with the same strategies they had several years ago. Companies with higher than four times EBITDA to debt ratios. Companies with greater than 50 percent of revenue coming from advertising.”
Leverage is usually the culprit. Even profitability doesn’t matter if the debt ratio is too large. “The companies that are vulnerable are the ones that have a lot of debt and are aggressively leveraged,” says Cam Bishop, founder of Clearview Resource Group and former CEO of Ascend Media. “And that’s the profile of most companies in the last five to eight years. That doesn’t mean they’re unprofitable. Some are extremely so, but covenant breaches that occur are primarily ratios that fall out of the range they’re allowed to be in given the credit agreement. A publisher may only have one covenant or several depending on the structure. They can be in compliance on all but one and they’re in breach. That can force them into Chapter 11 or some kind of restructuring.”
FOLIO: spoke with several operators about bankruptcy potential within the industry, what publishers need to do to come out of it and the dangers along the way.

Coming Out of Bankruptcy
Filing Chapter 11 doesn’t have to be the kiss of death. Reader’s Digest CEO Mary Berner told staffers last month that its voluntary pre-arranged Chapter 11 filing is “the best type of bankruptcy to be in” and is “strictly a balance-sheet issue” with no mass layoffs or salary cuts planned. The move will reduce Reader’s Digest’s debt from $2.2 billion to $550 million.
Ziff Davis filed for Chapter 11 in March 2008 and emerged in June of that year after reaching an agreement with an ad hoc group of shareholders to de-leverage the company’s balance sheet by converting more than $428 million in funded debt to a new common stock and a new loan note that was said not to exceed $57.5 million.
Quebecor World filed for bankruptcy protection in January 2008 and emerged in July 2009 having successfully closed $800 million in exit financing facilities. “We had a capital structure that was simply too laden with debt versus equity to manage our business effectively,” says senior vice president of market development Sean Twomey. “When our proposed sale of the European properties fell through, we got caught in the credit crunch. The key reason we’ve been successful exiting bankruptcy protection is because the underlying business is viable.”
But that doesn’t mean it’s painless (particularly for the equity holders that get squeezed out). The average Chapter 11 process in the U.S. runs for a year and a half and should be considered a last resort. “Once you go into Chapter 11 the courts have the authority to make decisions and you never know what the result will be,” says a publishing executive who wished to remain anonymous. “You go in with something prepackaged and the court could cut a different deal. One thing to keep in mind is that when a publisher declares bankruptcy, its lenders aren’t collecting debt service. The only people that make out in Chapter 11 are the lawyers. They get paid first.”
Chapter 11 also limits investment in the business—which can be fatal at a time when publishers are trying to reinvent themselves. “By the time a company gets to the Chapter 11 stage they’ve probably taken so much out that they’ve done irreparable damage to the brand,” says Harbor Communications president and co-founder (and former Penton president) Dan Ramella. “They probably need operating cash to give these properties a chance to revive themselves. As you continue to cut and trim back, the immediate effect is pretty imperceptible but as time goes on you’ve done so much damage to the brand it’s almost impossible to get it back.”
Another publishing exec voices doubts about the recovery potential for some Chapter 11 candidates. “Some companies do not come back from the brink,” he says. “It is hard to imagine Cygnus long surviving as currently constituted. Almost the whole portfolio includes number two and number three titles and small, low margin trade shows. The Web presence is spotty at best. It doesn’t seem like a winning formula…for anybody.”

Bankruptcy Not the Only Option
Still, filing for Chapter 11 isn’t the only recourse and often it’s the threat of Chapter 11 that sends a company looking for alternatives. “Restructuring is an alternative to bankruptcy but different classes of lenders have different rights when it comes to negotiating a restructuring,” says Charlie McCurdy, chairman and CEO of Apprise Media. “To accomplish one, lenders need to agree to a lower level of debt obligations. Often the threat of bankruptcy is used as a deterrent to bankruptcy in order to expedite an out-of-court restructuring.”
Other publishers can sell off assets for a cash infusion. “Companies try to sell assets and get a price greater than the multiple of their debt leverage, which will in effect reduce their debt leverage,” says Bishop. “They may make less profit, but they go back into compliance.”
Sometimes investors can put more money into the company to bring it back into compliance but often the credit agreement doesn’t allow that. “The PE guys would like to sell the business, that’s ideal,” says Ramella. “But given the nature of multiples and what’s happened in the last couple years, business media is not as attractive to financial buyers as it was in the past. Historically, once they got in the game, they just kept selling to one another. Now the music stopped and the guys holding the businesses that are struggling can’t find anyone to buy it.”
Some private equity owners may just walk away. With Reader’s Digest reducing 75 percent of its debt, that’s basically what Ripplewood is doing. “Bankruptcy is all about not being able to pay creditors, whether it’s suppliers or banks or whatever,” says Ramella. “If one of these companies trips its covenants and the bank comes calling, they’re left with no option. They have to convince investors to put more in play and they don’t like to do that. It’s like people who have upside down mortgages, they just walk away. That’s what PE is doing when they have to go that route.”

A Permanent Shift for the Industry
Regardless, that means the way the business is run fundamentally changes. “At the end of the day, CEOs manage more for the credit agreement than what’s in the best interest of the business itself,” says Bishop. “You make decisions on the entire cost structure and where you invest in business. If you can’t handle it at the moment based on forecasts—usually quarterly, when most tests of covenants are based—that old cliché that cash flow is king becomes a key component. Timing on paying and receivables plays a greater role in the decision process than in healthier times. The decision hierarchy changes quite dramatically and we’re still in a period in our industry where a lot of investment is going into e-media component without commensurate return.”
High debt may protect shareholders but not the company. “Assuming that a company performs to levels that allow for full and timely repayment of principal and interest, the more debt a company takes on, the higher the theoretical return for shareholders and the lower their risk in a doomsday scenario,” says Hall. “High debt means less equity invested and less for shareholders to loose in such as case. That said, I am not in favor of loading a company up with debt just to get a few extra points in return for shareholders. I prefer lower debt to equity ratios than have historically been offered in order to have the freedom to invest more profits into the business. If a CEO is unburdened from having to manage debt covenants and can’t earn back those extra points of return that high debt would have theoretically provided by being able to focus on the business instead of managing to banks, the company has the wrong CEO.”

What Happens Next for PE and Publishers
While lenders began seeking stricter covenants last year, the industry could see a return to “covenant-lite” deals that offer the publisher a little breathing room and flexibility to operate.
Multiples will remain low, even as the “fire sales” so many financial observers were predicting earlier in the year become more common.
“There are a lot for pre-backed businesses that aren’t overleveraged or at risk of going under,” says Ramella. “Some may be interested in taking it piecemeal but how many want to buy the whole business—that remains to be seen. A lot of companies are loath to sell individual properties over bundles but the price of entry in publishing is not prohibitive. But you do need deep enough pockets to find it, and if you’re patient, you’ll be a survivor. A lot of companies are struggling to have profit centers and brands that make money. They’re probably throwing cash off, but not enough to cover the debt service. That’s where lot of these companies got caught.”
The Race to the Bottom
It seems as if media companies are falling over one another in a race to price themselves out of business. First, print, with a few exceptions like SD Times, is in a death spiral. But it seems that media companies jumping on the online bandwagon are so desperate for sales that they’re pricing themselves into oblivion.
Because there are very low barriers to entry on the Internet there are often dozens or even hundreds of places that an advertiser MIGHT find a buyer. Which Web sites are best? I dunno, thinks the ad buyer, who then concludes that it must be the ones that generate the most clicks or have lower prices.
What about the hundreds of blogs or Web sites that might be “on topic?” The popular solution is the so-called ad network, which acts like a broker. Advertisers place one banner with an ad network, and it’ll appear on hundreds of Web sites. Meanwhile, Web site owners can sell “inventory” of banner spots via the ad network with no effort—especially leftover, or remnant, space.
It’s Lose-Lose
When Web sites with their carefully crafted content, expensive designs and unique readers become just another member of an ad network, do you know what they are? A commodity. An eyeball aggregator. Nothing more.
When you’re part of an ad network, the lowest price wins every time. Therefore, ad networks, with the willing cooperation of publishers and advertisers, are slashing prices in an effort to compete with one another. A network recently told me their standard CPM for remnant space was dropping to 50 CENTS. That’s one million impressions generating $500 in revenue. Who can stay in business for that?
Maybe Rupert Murdoch figured this out when he said we’re not giving content away for free anymore. Everyone says lead-gen is the answer—I don’t think so. Stay tuned.

Ted Bahr is CEO of BZ Media.
Edit Salaries Slump in 2009
Magazine editors saw salaries rise for the most part in 2008 but they expect a significant decline of possibly 10 percent or greater in 2009, according to the 2009 FOLIO: Editorial Salary Survey, conducted by Readex Research. The mean salary for editorial directors was $89,000, with b-to-b coming out on top at $98,200 followed by consumer at $90,800 and associations at $81,300.
However, just 20 percent of editorial directors expect a salary increase in 2009. Forty-seven percent expect it to stay the same, while 31 percent expect a decrease (of that number, the majority—15 percent—say they think it will drop by 15 percent or more).
Editors and executive editors saw a mean salary of $69,500 in 2008, with association coming out on top at $74,900, followed by b-to-b at $70,600. Just 17 percent of respondents expect an increase, while 53 percent expect salaries to be flat in 2009.
The consumer side posted the largest salary among managing and senior editors at $65,400, followed by association at $56,200 and b-to-b at $55,600. Again, 53 percent of managing/senior editors expect their salaries to be flat in 2009.

New Reality?
Some respondents wondered if a changing business model could mean lower salaries long term. “Closing down print products could be smart from a cost standpoint but getting big dollars from online is a challenge, which could result in cuts in pay and staff.”
“Compensation may not change but workload will due to reduced staff,” said another. One association editor talked about a shrinking readership. “Smaller organizations are disappearing and merging companies will mean less dues money. That means less operating money in budget for salaries/bonuses.”

Face Up

Face Up: Psychology Today
MAGSTATS
Issue: August 2009
Frequency: Bi-monthly
Launched: 1967
Circ: 307,000
Publishing Company: Sussex Publishers, LLC
Editor-in-Chief: Kaja Perina
Art Director: Ed Levine
Photographer: Andrew Eccles
Capturing a facial expression to represent the theme of an issue isn’t as easy at it looks. New York’s January 21-29, 2008 double issue, “Peace + Quiet,” featured an outline-less woman’s face with eyes closed, exuding relaxation and escape; more recently, Esquire’s 2009 commemorative issue featured the ‘Hope’ headshot of a pensive Barack Obama that read “What Now?”
For Psychology Today’s August cover, art director Ed Levine wanted to use an iconic image, “something that was strong graphically and emotionally,” to convey the cover story “Jealousy: Why It’s Really About You.”
Levine opted for a simple green and black color palette so as not to distract from the cover image. An important consideration, however, was the model’s make up. “I gave the makeup artist instructions before the shoot, and said the ‘most important thing is that the model doesn’t look Halloween-ish, like Shrek, or like the Wicked Witch of the West from the Wizard of Oz.’”
Achieving the shiny green glow required the makeup artist to combine green foundation with a binder to thicken it and apply shine over it, in addition to green lipstick. The green tongue was a product of Levine’s post-shoot Photoshop handywork. However, the constraints of a one-day shoot offered little time to experiment with alternative shades of green.
While initially Psychology Today considered “making her [the cover model’s] eyes green to represent jealousy, as in the expression ‘green-eyed monster,’ it was actually distracting,” says Levine. The full-on green cover may be better suited to the expression “green with envy,” but, as Levine says, “envy and jealously are often confused.”
The overarching goal was to ensure that the cover didn’t take on a synthetic quality. “We wanted it to have a natural feel,” he says. “Often, I try to create a poster impact, but as PT is a general interest magazine, we’re essentially selling the idea of being a person. I wanted to tie the cover to the gut emotion of jealousy.”

DESIGNER'S COMMENTS
“Visually, this is a very arresting cover. The image is bold, yet simple—the cover lines are catchy and easy to read. Even though the cover has a lot of information, it doesn’t feel cluttered to me, but informative. My only criticism is that the image seems to have little to do with the coverline. Yes, she’s green with envy (...not actually the same as jealousy...), but she looks like she’s proudly belting out the last note of a rock ballad. I don’t get a sense of the emotional confusion and spite that jealously brings out in a person. But, maybe I’m just envious.”
Karen Player | Art Director | Harvard Business Review

“As for the image, jealousy is the ‘green-eyed monster,’ not the Hulk. In order to convey jealousy, it would work to have her eyes open and green, and keeping her face ‘un-green.’ Eyes have a tendency to really attract people and draw them in, so having her eyes closed isn’t adding anything to the cover. Her crooked mouth is also kind of disconcerting. I do love the + and - signs that the art director uses; they really work graphically. I also really like most of the coverlines. One that could use some work is ‘5 Dating Shake-Ups for Singles,’ since I don’t know what a ‘shake-up’ is; also, the coverline ‘10 Laws of Great Art.’ I thought the point of art is that what’s good is subjective. The word ‘law’ is also jarring. I would space the left side coverline “What A Kiss Can Tell You” to read: What/A Kiss/Can/Tell/You.”

Thea Selby | Principal | Next Steps Marketing, Inc.

Best Practices

A Web Traffic and Engagement Tip Sheet
Everyone needs a review sometimes. And in the highly competitive and, especially for magazine publishers, make-or-break world of Web content publishing, SEO and engagement are two critical strategies that deserve perpetual oversight and review. So, in that spirit, we’ve spoken with a number of SEO and Web content development experts across the industry and compiled their favorite ways to drive—and keep—traffic to their sites.

Optimization and Traffic

Topic Pages Are the Anchors
We’re all creating hundreds of thousands of pages of content that come and go on a daily basis. Topic pages that never change their URLs, however, are like a traffic magnet. Over time, other sites will link to them, building up that all-important “Google juice,” and topic pages tend to be very keyword heavy.
“If something has been up over time, you build up more incoming links,” says Kelly Maloni, director of product development at New York. “Google is looking for incoming links, keyword-friendly URLs, and keyword-rich pages. Pages that have those and don’t change over and over again have a lot of weight. It’s about owning the keywords, a simple URL, and owning that space.”

Remember Your 301 Redirects
Every site needs to rebuild its structure at some time or another. If you do have to change a URL to a topic page or a directory page, make sure you alert the search engines with a 301 Redirect command, which tells search engines that the old URL is the same as the new one.
“We’re pretty obsessive about the 301 Redirects,” says Maloni, who warns that without it, Google will treat the URL as a brand new one and all the elements built up over time that gave the page a high ranking will be erased. SEO for that section will have to start all over again. “Instead, a 301 Redirect tells Google that the old URL is now the new one, and to consider them the same page and keep the page rank.”

Social Media Isn’t Just a Buzz Phrase
“It can actually work from a traffic standpoint,” says Jonathon Hills, acting GM of ReadersDigest.com. “We’ve done a lot to ramp up our social media efforts, which now account for a good portion of our traffic.”
Digg, StumbleUpon, Facebook, Twitter—they’re all being used, but not indiscriminately. “Social media is a fuzzy area, but if you select the channels carefully and position the content in a way that makes sense to your brand, it can be a powerful traffic driver,” says Hills.

Leverage Your Analytics
“A lot of my work comes from looking at analytics,” says Alison McPartland, manager of search and discovery strategies at Questex Media. McPartland created a “Top Author” report that identifies which editors and what content brings in the most traffic—and uses it to foster a bit of friendly competition. “It’s the top 30 articles of content per month,” says McPartland. “We pull who the author is and what the topic is and analyze page views, percentage over site, total amount of keywords that were driven to that story, average time spent, bounce rate and exit rate.”
The content analytics reveal how visitors find the content (keywords) and what topics are trending high. McPartland then makes sure to share the details with the editors. “It gets them competitive with each other and makes them proactive, rather than waiting to see what works.”
Leveraging Syndication’s Results
Finding other Web sites and portals to syndicate your content is another way of driving traffic back to your site, but it’s what you do with the traffic that’s also important.
“We’ve got great partnerships with MSN, Yahoo!, AOL and some smaller sites as well,” says Sean Nolan, Rodale’s VP of online operations. “We assume we’re getting new audiences and populate the article with downstream links. We try to get them around the rest of the site and show them related content—maybe have a subscription or product offer.”

The E-mail Newsletter Connection
Create and send e-mail newsletters as often as people give you permission to. “It really begins with e-mail,” says Jason Revzon, VP of Taunton Interactive at Taunton Press. “Half of our traffic comes from search, but e-mail is hugely important. It’s your way of reminding people what’s on your site. Depending on the site, we double or quadruple our traffic when the e-mails go out.”

Content and Engagement

Tease Related Content
“You want to watch for people viewing multiple pages of content across the board,” says Omid Jahanbin, director of product design and creative strategies, interactive platforms, at Cygnus Business Media. “We want to keep on average four pages of content on the top of our page view line.”

Time the Release of Certain Content
Post content when your audience is most likely to read it. “You want to release content when you have a high traffic period,” says Jahanbin. “Typically, 11:00 am is very high for our publishing partners.”
The added benefit here, says Jahanbin, is readers are more likely to avail themselves of the sharing functions, too—e-mail to a friend and the social networking buttons. “There’s a reason corporations release news they don’t like on a Friday. It’s lost its mystique by Monday.”

Content Packaging and Presentation
Don’t just shovel a 2,000-word story into a single Web page. Break it up. Add infographics. Consider changing the format completely. “We’re always trying to turn a full-length magazine article into a seven-photo slide show, for example,” says Hills. “We could take that and break it down and extract pieces and add some relevant images and create a whole new story—that presentation works better than a 1,000-word article. Or we could turn 25 tips into a one-minute Web-exclusive video clip.”

Reformat Your Video Presentation
Consider breaking up a longer-form video subject into a number of shorter clips that can play in a series. Taunton’s Revzon has introduced “snack-sized” videos that visitors are watching all at once. “We recently went from a single-clip player on a page to a player that has eight clips on a subject that play in order,” he says. “People are watching eight videos on average, and that keeps them there a long time. They’re small nuggets—between 40 seconds and two minutes—but they’re put together in a way that lets you lean back and enjoy them.”

Make Your Slideshows Tell a Story
A perennial page-view favorite, it can actually be hard for image-only slideshows to keep readers until the end. At UBM’s Channelweb.com, vice president and editor Larry Hooper says they get 80 percent pull-through on their slideshows by adding some editorial content. “We treat them like stories, not like a bunch of pictures with captions,” he says. “We take a graphic novel approach to pull people through.”
Hooper also says that he’ll substitute a slideshow or other visuals for a text-based story where it makes sense. A story about 10 new laptops, for example, could easily be turned into a slideshow.

Pull Your Visitors into Guiding Editorial Development
User-generated content is one thing, but having your site’s most loyal visitors help guide story development accomplishes two things: Your editors have first-hand knowledge of what topics matter most, and your users are pulled deeper into the site experience.
“Instead of calling up five or 10 readers, we’re starting the reporting within our community,” says Hooper. “It creates more traction than just commenting. Our reporters have set up private groups and invite experts to join, and those are generating stories on the site.”

Columns

The Accidental Profession
Magazine editing is not a job. It’s a calling. Like barbecue experts, most editors are self-proclaimed. Very few graduate from journalism school where they majored in magazine editing and come up through the editorial ranks. Most editors of my acquaintance have stumbled into their jobs through happenstance. They studied accounting (with an English minor), took a summer job at a fulfillment house, did some copyediting on the side, became an assistant editor when someone quit on short notice and now the title is: Editor-in-chief.
I call it the accidental profession. Or another way of putting it is—we don’t choose magazine editing. It chooses us.
Today, the job is changing dramatically as we find ourselves in the midst of enormous change in the profession. We are in the bunker in an age when magazines as we have come to know and love are at risk. Many are gone, and many others are in deep decline—as though they are saying: “Please help me, I’ve fallen and can’t get up.”

What Can We Do?
Foremost, let’s recognize that the dilemma is not primarily an editorial problem. In most publications, editorial has never been better. Advertising—or the lack thereof—is the problem.
What does an editor need in these troubled times? You don’t need more money. (In fact, don’t even ask.) You don’t need a bigger staff. That’s just more cost—and more people to worry and wonder about.
I think you may need an extra dose of savvy—which I define as the ability to learn and to work that knowledge quickly into the editorial mix while we ride things out and wait for an upturn in the economy and in the ad-page count.
A minor in psychology helps.
This is nothing new for us in the editing game. Inventors and magazine editors are seldom without problems to solve. It’s all part of the job description.
We all know how important it is to know what you want. It is also important to like being in charge, and now is the time for being in charge of change.
When the crunch is on, editors will go to great lengths to make everything change. They will hire new people and fire those who don’t seem to do the right thing. They will change the look of a magazine. They will change the story mix, the departments. They will do everything but change themselves.

Your Real Job: Editorial Sales Manager
To which I say—editor, examine thyself. Instead of taking yourself as an editor, consider a totally new persona. Your approach to each issue should be: This is not a publication, it is an EVENT.
You are in charge of selling tickets to an editorial event. Think of your job as Editorial Sales Manager.
Here we can take a page from the advertising playbook. Advertising changes constantly. Ad campaigns change. Ads within a campaign change regularly. Some ads are seen only a few times, and then replaced within a 30-day cycle.
Tradition is one of the major roadblocks to editorial change, a powerful force not easily overcome. “If it’s October, we’ve got to do the show issue”—that kind of thinking is paralysis in the current environment.
It all begins with a campaign plan. Revising and revamping your contributor guidelines is a golden opportunity to change the way you do editorial business. Get the magazine on a new track at ground level, and keep it there for purposes of editorial planning.
The editor’s job today goes beyond getting the magazine’s content right. As editorial sales manager (or event planner), your job is to SELL editorial, to stage the magazine as an ongoing advertisement for itself. This means creating events that are constantly evolving and changing so that each issue reads and looks “the same, only different” and, in doing so, arouses curiosity about the next issue.

John Brady is a partner at Brady & Paul Communications, a publishing consultancy that assists and critiques magazines. For information on his workshop text Magazine Editing: The Practical Approach and his Interviewer’s Handbook: A Guerrilla Guide for Reporters and Writers, his web site is johnbrady.info, or you may e-mail him at Bradybrady@aol.com.
What’s Your Cover Strategy?
Building a great magazine involves a lot of processes, players, deadlines and content. It’s a relationship that’s not easy. Successfully marrying good ideas with quality execution takes planning and patience, especially when creating the cover of the magazine. We consider the cover one of the most critical areas requiring strategy, second only to content strategy. It’s important to think about cover solutions early in the process to reflect this plan.
What is your magazine’s cover strategy? This goes beyond the logo, coverlines and color palette. It’s about defining what will be on each cover in terms of quality and commonality of the images, and overall tone.

More Than Just the Cover Story
For many magazines, cover strategy is defined as whatever the team can get with relation to the main feature. While this approach can be a start, it’s not the end.
Some magazines jump back and forth between photography and illustration. It can work, but few have done it well. Wired’s covers are great examples; they may have a conceptual photo, an interesting portrait shot, or a creative illustration but the commonality between them is the high level of quality and a great idea driving the image. Lay six different issues side-by-side and you’ll notice the covers are clear expressions of the same brand, but also individually engaging.
Many association and b-to-b magazines struggle with this, and are challenged by budget restrictions and finding the right image to tell the story. Most shy away from taking risks, leading to the use of literal imagery. Going the safe route every time soon becomes stale. Stock images can be a useful resource, but custom visuals always make a stronger impact.
If budgets are tight, don’t be afraid to negotiate for a better rate. Consider non-traditional resources like art or journalism schools, which may have excellent senior-level students looking for the opportunity to do real-world work to build a portfolio.

Thinking Differently
Start thinking differently about your covers by setting aside time to brainstorm and create a plan. Get it down on paper, then measure each cover concept to the strategy. Remember to engage the reader quickly, as it’s the cover’s job to pique interest and capture attention. Your magazine is on the reader’s table with a pile of other things—be the must-read! Here, questions to consider during your cover strategy work session:
1. Which editorial content drives the cover (the feature, or are there other opportunities to create a dynamic image)?

2. Does the cover lead the reader inside?

3. Are your covers clearly and creatively tailored to your target reader?

4. Does your cover have substance, or is it “wallpaper”?

5. Are cover images crisp, high-quality and have a clear focus?

6. Where do the images come from?

7. What are the struggles you encounter in getting a great cover image each issue?

8. How can you overcome that challenge with your new cover strategy?

9. Can you increase the budget for your cover by lowering costs elsewhere?

10. If you need to use a stock image, would your budget and circulation allow for the use of a unique rights-managed image as opposed to a royalty-free image?

11. Can you create a strategy that will allow multiple issues’ cover images to be photographed/created at the same time to save money?

12. Who determines the cover image concept—editorial or creative? Should this change or be collaborative?

13. How important are your coverlines? Should there be more or less?

14. Does your cover template need a redesign to be ready for great images?
Additional questions are sure to come up along the way, but hopefully these will get you started. Chances are, stronger solutions are out there if you have the desire to strive for improvement. It will all be worth it when you see your readership make a lasting commitment to your publication.

Debra Bates-Schrott is president of design firm Bates Creative Group and has more than 16 years of experience in design strategy, management and art direction for magazines and organizations.

Features

FOLIO:’s 2009 Manufacturing and Production Trends Survey
Manufacturing and production executives may rarely make the news, but their decisions have the potential to impact the future of their print publishing companies. While 2009 spending has taken a significant dip—like most everything else in the industry—with many opting out altogether, industry execs are forced to get back to basics and make savvy decisions when it comes to which technologies are worthy of investment dollars, and which fall short.
FOLIO:’s 2009 Manufacturing and Production Trends Survey reports what tools—like ad portals, virtual proofing and XML workflows—continue to come into their own and save publishers valuable dollars, as well as those areas that manufacturing and production execs are avoiding. Facing so many challenges this year, it appears that decision makers are remaining status quo and investing only in upgrades that will save big in the long run.
Most Investment Under $5,000
Thirty-three percent of those surveyed report not investing at all in 2008, and of those who did, 22 percent say that new technology investments were less than $5,000 (the lowest price bracket). Most technology investments stuck to the basics, with survey verbatims resoundingly fixed on “computer hardware and software”; “printers, and software” and “hardware upgrades.” Other areas of minor investment include online development through digital magazines and newsletters, pre-press technology and Web development and hosting.
Nearly half of those surveyed (49 percent) report no change in spending on manufacturing and production in 2008 over the previous year, while 15 percent cite an increasing investment in 2008 from 2007. However, this is down 6 percent from 2007 versus 2006. Within this diminishing category, 3 percent of respondents say that their investment is in the “30 percent or more” and “less than 10 percent” ranges, with 9 percent between a 10-29 percent increase. Twenty-three percent of respondents cite a decrease in investment—up from 5 percent last year—particularly in the 10-29 percent category.

Virtual Proofs Aren’t ‘Interim Technology’
FOLIO:’s 2009 survey shows publishers streamlining many manufacturing and digital production processes with in-house resources increasing by 7 percent from 53 to 60 percent this year over last. Respondents also reported that both outsourcing and in-house pre-press sources have decreased by 7 percent and 2 percent, respectively, since 2008.
A bright spot in this sector is the number of publishers using virtual proofing, up 7 percent, and for good reason. Industry executives report bigger savings from the process, with 14 percent saving $20,000-$49,999 (up from 6 percent in 2008). Savings in the less than $4,999 category, however, have decreased since 2008.
In a recent FOLIO: story, Time Inc. director of digital technology, Kin Wah Lam, says he continues to be quite happy with virtual proofing since beginning with it in 2004. However, at this year’s PRIMEX conference, industry vets projected whether no proofing, or print to the numbers, could be next in the evolution of more efficient proofs. While Lam thinks that this process—running a press without any reference proof to guide the operator—has some potential down the road, he considers that “current print-by-numbers alone isn’t good enough to eliminate any form of hard or virtual proof.” Lam doesn’t consider virtual proofing to be an interim technology; if anything, he considers it a complement to the print by numbers process.
In addition to virtual proofs, ad portals are also experiencing growth, with a slightly higher number of those surveyed using a portal system (26 percent versus 22 percent in 2008); the number of respondents not using an ad portal has also decreased by 5 percent (from 76 percent in 2008 to 71 percent now). While many continue to use Web-based ad portals to manage their ad traffic (a small percentage over last year anticipate implementing one in less than six months), Martha Stewart Living Omnimedia developed an in-house, open source platform in June for more efficient delivery and receipt of advertising materials. “We can push ad material extensions even closer to press time than we have in the past, which allows us to provide more flexibility for our salespeople and our clients,” says Dora Cardinale, executive vice president of print production. The argument for portals has also gone green. “This process is also environmentally friendly since it allows for the elimination of thousands of discs that, after a single use, literally become landfill,” she adds.

Digital Workflow Formats
The need to automate has become a no-brainer for many publishers, particularly when it comes to PDF workflow technologies. Twenty-two percent of respondents are using an XML workflow, up from 18 percent last year. The number of manufacturing and production execs using XML for every stage of the process has also grown 7 percent (from 2 percent to 9 percent in 2009). Unfortunately, fewer respondents reported big savings with XML in the $5,000-$9,999 range, but 8 percent more than last year reported smaller savings between $1,000-$4,999.
While XML saw a slight increase, the outlook continues to be bleak for JDF (Job Definition Format) files, a production standard that enables publishers and printers to describe the intent of the printed piece, as well as each process step required to achieve that intent. Respondents say they are less likely to use JDFs (4 percent this year versus 7 percent in 2008), and those who will never use JDF has increased over the past two years—from 23 percent in 2007 to 30 percent in 2009.
In 2007, Hachette Filipacchi experimented with using a subset of JDF as an e-commerce message set to allow more automated delivery of materials for pre-press, but ended up abandoning the effort. “Decisions are changing so rapidly that we put a stop to it and haven’t picked it up since,” Hachette’s director of digital technology, John Dougherty, said at the time.
Online insertion orders have also decreased in popularity, with almost 10 percent fewer reporting use from last year, and 7 percent more citing that they do not use this technology.

Production Sees a Renaissance
The 2009 respondent profile reports that the “types of magazines published” have remained flat with the exception of city and regionals, increasing by 11 percent. While the number of dedicated production pros saw a decline in ‘08 (down 54 percent from 73 percent in ‘07), they experienced a resurgence in 2009, increasing to 70 percent. And despite a bleak outlook, a growing number of high revenue publishers—$75 million plus—expect to meet revenue numbers this year.
Startup Stories
ACP Gets Second Chance
After Reed folded 13 construction titles, the group’s original owner is making a play to bring hem back.
by Matt Kinsman

In April, Reed Business Information shuttered all but one of the magazines published under its Associated Construction Publications Group, which consisted off 14 regional construction titles (Reed held onto Construction Bulletin).
That opened up an opportunity for John White, the original co-owner of the ACP titles (which were started by his ex-father-in-law), who continued to publish a newspaper for commercial construction in Indiana. “I called Reed and spoke with one of the VPs who was willing to see if there was interest in selling,” White says. “I didn’t need much for due diligence. It was basically, ‘You can have what’s here, you get what you get, do it quickly because we want it out of here.’”
The deal was done as a license agreement through the end of 2009, with White having the option to pick everything up in January. While he wouldn’t reveal specifics, White says his group sold the titles for $21 million 15 years ago. “We didn’t pay nearly that much this time,” he adds. “This was good for Reed because it helped them cover a lot of their shutdown costs.”
White is facing a new reality with the magazines. At the time he sold them, collective revenue for the 14 titles was around $19 million. With the 13 he has now, he’s expecting about $5 million in 2010. “Give me six months and we can give a better answer on the potential,” White says, adding that his smaller operation could see greater profits than it did under Reed. “When you’re part of a larger corporation, there are many layers of overhead put on the magazines. We don’t operate that way.”

Ramping Back Up
Logistically, ACP faced a challenge in that much of the staff had disbanded and the postal permits were discontinued. “The biggest pain we have right now is trying to get them back to requester status,” says White. “We’ve got the circulation list and have to get it re-validated.”
White went to all people who worked with ACP recently, looking for good fits. ACP has 12 full-time employees, with nine former employees doing freelance edit and production work. The company also brought back editorial director Greg Sitek.
Re-Focusing on the Local Market
One priority is getting ACP back to its roots in local coverage. “Reed was focused more on national manufacturer sales because those were bigger dollars,” says White. “They tried selling locally over the phone and eliminated the local sales presence. That had been the heart and soul of ACP magazines. We’ve tripled the sales team at the local level and we’re getting very good response from our old customers but we’ve had people tell us that if we weren’t going to make those commitments to local coverage we’d be better off leaving the magazines to die.”
So far ACP has attracted advertisers such as Volvo and LBX. “Many of these advertisers had already re-allocated the 2009 budget for these magazines but when they saw what we were doing, they found a little more,” says White. “It was their way of saying, ‘We’re glad you’re back, here’s what we can do to support you while you’re ramping up.’”
In late July, ACP re-launched Construction Digest and New England Construction. By August it brought back six more titles, and, as of presstime, anticipates all 13 re-launching by September.
ACP is changing both the format and design of the magazines. Weekly and twice-per-month magazines will go monthly, and will grow to tabloid-size with larger, full color graphics. “When you’re competing with digital media, my experience is that you’ve got to have something visually appealing as well as good editorial,” White says. “Rather than have people toil through small print, if we can put better graphics/pictures along with well written stories, that will attract readers.”
Once the print products are live, ACP will then turn its attention to ramping up Web and live events. “We partner with a lot of associations and other groups that do events,” White says. “That’s what they do well. If there are opportunities for us to get into events where we can sponsor or put them on, we have the capabilities to do it. I’m a huge believer that print is here to stay. We will invest in those e-media initiatives that make sense but very few of our readers are sitting at their desks online all day.”
White offers some advice for the growing number of former publishing employees trying to take over their former properties. “The main thing is to focus on their core competencies—are they coming from a sales standpoint, editorial, etcetera,” he says. “If they go out on their own, they won’t have the same resources available. It’s very important to find vendor partners like Publishers Press that will work with you.”

Afar Appeals to a New Type of Traveler
The brainchild of entrepreneur and experiential traveler attracts luxury advertisers.
by Vanessa Voltolina

During one fateful trip to India back in 2006, a new experiential travel title, Afar, was born. After selling the interest in his last successful business venture, former attorney and i-banker-turned-entrepreneur Greg Sullivan began traveling the globe. During one trip to India, he met Joe Diaz, who shared his interest in travel and identified what he thought was the lack of media voice for cultural explorers and experiential travelers.
“We wanted to build a brand around this concept—and we thought that the best way was with a magazine so that we could put voice, photos and stories with this kind of travel and create a feel. This way, we could grow to other mediums,” says Sullivan, Afar’s CEO (and co-founder with Diaz).
The San Francisco-based title launched August 18 and is planning to print six times a year to start with a $4.99 cover price (and $19.95 for an annual subscription).

Capturing Luxury Ad Dollars
Before its launch, the New York Post gave Afar a four-star rating, ahead of established travel titles like Condé Nast Traveler (2 stars), BudgetTravel (2.5) and Travel + Leisure (2.5). And while a good media review bodes well for a new magazine, it doesn’t guarantee that ad dollars will follow.
That’s why Sullivan established three tactics for culling ad dollars as a startup during this rough period for publishers. “First, we are capturing this emerging travel movement and trying to be a voice for this form of travel,” he says. “Secondly, the company will start with a small niche market in the hopes of picking up early adopters who are passionate about this lifestyle. Third, we’re doing something that no one else is.”
In its premier 96-page issue, Afar had 35 advertisers, many of which were in the high-end and luxury markets. “We finished our marketing brochure in March when it was really bleak out there,” says Sullivan. “Talking with potential advertisers about buying ads in a new magazine was a fairly ludicrous activity in many ways.”
In spite of this, advertisers in the travel market “got it” with regard to the brand’s positioning, Sullivan says, even though not all had the funds to commit, or believed that Afar could pull it off. “Unlike a mature media company, we didn’t have value-add to promise advertisers. We just offered them brand partnership,” he says. A surprising change of pace, he says, were some of the non-endemic advertisers that have bought in, including one South African street food vendor. “People are looking for authentic, meaningful travel, and many luxury brands were willing to say that they were confident enough in our brand to sign on,” he adds.
Sullivan was able to fund Afar’s launch completely out of pocket, with a financial commitment of $10 million. Its first two issues will have a rate base of 50,000, stepping up to 75,000 in January 2010, he says.

Brand Extensions
The experiential magazine hopes to grow its circ. to 250,000 over the next three years by targeting a high income demographic. “We started with direct mail in June,” says Sullivan. “We plan to do some direct mail in December and in June 2010. We’re building up circ. the old-fashioned way, and we hope that through future social media initiatives we’ll drive people to the site.”
Afar will be sold on newsstands, at Borders and Barnes & Noble bookstores, in Whole Foods Markets across the country, and in all major U.S. airports.
Plans for Afar in the first half of 2010 include a social media Web site that will capture an even larger demographic, connecting readers to a destination and helping with the travel experience; future initiatives will also include events, a natural line of business for this area. “We’re talking about doing U.S. events and bringing in international vendors,” says Sullivan. “Possibly some travel planning services, a TV partnership, and book publishing. It’s also easy to foresee international editions and licensing for magazines in other countries, but we haven’t gone down that road yet.”

Health and Fitness Title Enters Flooded Category
SOBeFiT opts for content over “fluff,” with plans for U.S. expansion.
by Vanessa Voltolina

Even in the most highly saturated markets there’s room for one more publication. At least, that’s what Marta Montenegro, publisher and editor-in-chief of Florida-based health, nutrition and fitness title, SOBeFiT, thinks.
Launched in December 2008, SOBeFiT bucks the typical content mix found in most health and fitness magazines, which, says Montenegro, “end up just being about beauty, with quick-hit content. I was tired of reading magazines with no substance, and wanted to offer content in the middle, between the quick hits and ‘fluff’ that most health and fitness magazines offer and an academic journal.”
SOBeFiT also has a unisex brand (a rarity in this genre) which offers “more sophisticated content. It’s not just about weight, but has enough substance that it requires readers to sit down and read it,” she adds.
Montenegro, who has years of experience in the field—she’s worked as a Washington correspondent, launched a newspaper in her home country of Venezuela, and opened a wellness center—says that she’s always had a passion for sports.
This led to her brainstorm of SOBeFiT two years ago. The funding for MPG Publishing’s only title—around $4 million total—came exclusively from investment holding firm ABA Partners. Started by Venezuelan entrepreneur Enrique Auvert and three other partners 20 years ago, the holding company has been investing in real estate media in both short and long term projects.
“Going in, I knew the magazine was going to be pricey,” Montenegro said. The magazine has 15 contributing writers and 15 departments, as well as the different products like a collectible flash card binder to redeem the magazine.
“This business takes time; one of the most common mistakes for entrepreneurs is to expect returns overnight,” Montenegro says. “We know that in this business, it will take about five or six years to break even,” which is how long she anticipates the funding to last.

Event Incentives
It’s one thing to concept a new title, but quite another to convince advertisers to sign up for yet another health and fitness print buy. SOBeFiT launched with only 5 percent advertising, in December, says Montenegro, but since then they have boosted the ad ratio to 15 percent for the current issue (its fifth).
While it has not lowered advertiser prices, the magazine is offering “certain discounts,” namely with its signature events. “We are hitting a great audience [with these events] that advertisers can pass products to,” Montenegro says. Advertisers also like the magazine’s unisex aspect, she adds, and see it as “a way to get the most for their money.” Montenegro was surprised to see big name advertisers, like Dove and Nivea sign on to SOBeFiT since it is still a regional publication.

Tapping Medical Markets
To build its audience, SOBeFiT has reached out to an alternative demographic including those in the medical field and at medical schools. Beginning with a modest 50,000 copies at launch, the publication has already grown to more than 65,000, with the intention of bypassing 100,000 by the beginning of 2010. Expansion plans include a New York edition as well as a third version, yet to be announced, at the beginning of 2010.
Reader feedback has been positive. Several events were launched at the same time—a 5K Run/Fitness Festival and Fittest Person of the Year contest (it won a 2009 Folio: FAME Award for best launch party). This year, SOBeFiT will be involved in upwards of 30 partner and solo-produced events.

East West To Re-launch in October
Founder says magazine is at “20 percent of advertising goal” for the debut issue.
by Matt Kinsman

Multicultural magazine East West will relaunch as a bi-monthly on October 6. In April, founder Anita Malik announced her plan to bring the title back but was looking for an additional $150,000 to $200,000 in funding.
“Our goal has always been to go back to print,” says Malik. “We had some private investors step forward and they believe in print as much as I do. Particularly with this niche market, print will remain viable. It’s a scary thing but for us it felt right.”

Making the Pitch To Readers, Advertisers
The relaunch will have a circulation of 20,000. East West archives remained online during the magazine’s hiatus and Malik says readers continued to sign up. “We’ve been honest with readers and we’re telling them ‘we know you’ve been waiting’ and trying to say we’re human too with a small publication. People are kind of rooting for the magazine and when we were gone readers kept knocking on the door.”
Malik says the content and mission will stay the same but she hopes to take advantage of online marketing, particularly through Twitter and Facebook. “We’re really focusing on the marketing aspect, we never really had the funds for it (and don’t really have it now) but we can benefit from social networking which wasn’t as prominent as it was before.”
East West is offering a cover design contest in which readers can develop the cover for the October issue. “We’ve typically done a glamour shot cover but Asian Americans are often very interested in design and we have a new blog focused on designers, so why not do something that gets readers involved?” Malik says.
The advertiser pitch is harder. “That’s the tricky one,” she says. “I’ve come to the understanding that it’s going to take a while for them to feel secure again with who we are and that we’re not going to put out just one issue and go away. We’re seeking out new advertisers and a lot more companies are focused on multi-cultural marketing than a few years ago.”
Malik says she is currently at 20 percent of the advertising goal for the October re-launch. “We’ve still got some time,” she adds. “I’m looking at that coming back in 2010. We wanted to get two issues out this year to get advertisers comfortable so they’ll be ready when January/February rolls around. We’re being realistic that this will take a while and be hard. Our goal is to go monthly for 2011.”
The title also must secure newsstand distribution again and will have a circulation model of subscription and newsstand as well as controlled in Los Angeles and Phoenix. “This will be a gradual buildup,” she says. “We’re starting over because we have to say, ‘This is why you should carry us again.’”

The Next Silicon Valley
Downsized from UBM, award-winning journalist Richard Wallace pursues his own Web startup.
by Matt Kinsman

When Richard Wallace was laid off from his position as vice president, editor-in-chief and director of global development at UBM’s TechInsights in December 2008, he decided to pursue an idea he had kicked around for years. “I’ve been covering Silicon Valley since 1976 and in that time regional development centers have sprung up beyond outsourcing. The Next Silicon Valley is a metaphor for the next great wave of globalized technology development.”
The Next Silicon Valley started as a one-man show with a Web site and a Twitter strategy that filters posts from journalists all around the world. “We use Twitter as a news wire,” says Wallace. “We may do 20 or 30 posts per day and spot stories for the current Web sites. If something is really interesting we’ll send out an assignment at the local level. We’re very keen on local reporting. It’s not the cheapest way to do things but it’s the best way. Online has a different value proposition than print. We can do some things that would be prohibitive in print.”
The Next Silicon Valley is self-funded (another equity investor has since joined and will own a piece of the business) and Wallace estimates he spent $150,000 on research and development and he has an edit budget between $50,000 and $75,000. Drew Wilson, a veteran international correspondent who has written for Red Herring and EETimes Europe, has also joined The Next Silicon Valley.
Wallace plans to launch a new site in September and wants to start selling advertising as traffic ramps up. He expects to sell initially on a charter sponsor basis and transition as traffic increases into a page impression model. “We’re expecting this to be a high traffic site and we know it will take a while to get there,” Wallace says. “Next year we hope to be in expansion mode. The first thing is to recover the investment. Online, the margins are good and the costs are low. Most of our investment is going to editorial costs.”
Wallace says the biggest step was making the commitment to move forward. “I’d thought of doing this for quite a while, and when I got laid off in December, that day I said I’m going to do it,” he adds. “The learning curve was doing stuff for myself that I used to have other people do: building a mailing list, building a newsletter, doing some marketing, setting up a Web site. It was a question of getting everything organized and realizing there are a lot of people I can tap into. The upside of the current meltdown in the publishing business is that there’s some wonderful talent out there that wasn’t available before.”

Publishing Technology

The New Publishing Mandate: Anywhere, Anytime
There was a time not too long ago when the magazine publishing industry seemed a bit confounded by how to best utilize the newfangled delivery option called the Internet. Now, publishers are ramping up their content and output to be in multiple places and multiple formats, from Facebook to Twitter and Web sites accessed from various devices such as the iPhone. In fact, there have been 171 new digital initiatives across all available platforms announced by the consumer magazine members of the MPA so far this year, according to the organization.
With all of these distribution channels, which seem to be expanding daily, publishers have to figure out a way to reach readers in all platforms efficiently while staying true to the brand and core competencies. It’s no small feat, yet many publishers are having great success and capturing new readers along the way.
Take for example, the September issue of Golf, which marks its 50th year in publication. The magazine has put together a multi-platform content package that includes special content throughout the magazine, a special gatefold in the back of the magazine, as well as unique content available on the site such as the PGA Tour Confidential and free video lessons from the magazine’s top 100 teachers that can be viewed from Facebook, the Web site or an iPhone.
The group has launched two mobile efforts that it feels are both relevant to its audience and relevant to its advertisers. It launched the mobile version of Golf.com, which can be accessed from any device, though it’s optimized for iPhones, says Ken Fuchs, VP of Sports Illustrated Digital and the Golf Group, and general manager of Golf.com. He calls it a slimmed-down version of the Web site with live reader boards, instructional videos and course guides with a 16,000-course database. Secondly, from a game-management standpoint, it offers a deep layer of scoring stats, the opportunity to upload photos, get golf news, communicate with friends, set up game times and compare stats, which cuts across mobile, Facebook and Golf.com, he says.
The Golf group, through SI GOLFNation, also provides users with a back-end searchable database for golfers to track their game and their friends in the game. This can be done whether the reader is on the golf course with a phone, on the computer using Facebook or online, Fuchs says. The players can compare data and share stats from any of these platforms. “It’s allowed us to take our core competency—producing content—and share it across different media,” Fuchs says. “We’ve embedded a video player within the product that ties back to a specific issue about fixing the player’s game which makes their golf game better and lets them take control of the content and match it up to their individual game.”
The function of the app that allows users to search golf equipment has driven traffic up more than 60 percent this year alone, based on the tools SI GOLFNation provides, coupled with strong editorial, Fuchs says.

No Real Tech, Cost Barrier
Golf tries to use all of the distribution technology that have open APIs (applications program interface, essentially, the building blocks of programs) to take its core content and its proprietary system to work with partners. “SI GOLFNation is a wonderful product application, but it’s really built out of our core competency. Recognizing that and building new products across that is what’s valuable,” Fuchs says. “The trend is everything is getting cheaper to do from a publishing standpoint. With open APIs and not much cost, it’s easier to take this and reach customers in new ways.”
The barrier to entry is around distribution, he adds, noting there’s not really a cost barrier to entry or a technology barrier.
“It’s less about new technologies and more about learning the appropriate ways of using already existing platforms to distribute content,” says Ashley Parrish, senior Web editor at Marie Claire.
The publication uses several different outlets to expand the reach of its content. For example, with its Web site, it posts content in a variety of forms in order to reach a variety of users, from posting content in article format, to blogging about an article or linking to it, or even creating video content around the theme of the article, Parrish says.
Marie Claire also relies on its syndication partnerships to distribute content out to larger pools of people and individuals who might not normally search for Marie Claire content.
Finally, the magazine uses social networking tools, from Facebook to Twitter. “We make it very clear that there is a personality behind our brand accounts,” Parrish says. “It is about connecting with the community—asking them questions, responding to their queries and creating a conversation about the user, the brand and the content.”
Marie Claire accomplishes all of that by looking at pieces of content from a 360-degree view and identifying the key components of content that will work for some audiences and other parts that will work for others, Parrish says. With a magazine story that may have two to three sidebars, it will link back and forth between them and publish them in a number of ways, she adds.
Magazines aren’t just using these platforms and devices to get the typical payoff but new goals such as consumer data and opening the lines of communication between readers and the publisher to gather new story ideas. Though publishers can capture valuable consumer information with the different platforms, it is also possible to delve much deeper into the interests of the consumer to create a broader picture of them to understand their content consumption and also to provide useful information to sponsors and advertisers.
Users of SI GOLFNation often provide information beyond a general user profile to include what kind of golf clubs they play with, which tour is their favorite and which shoes they wear when they play golf. “We learn more about them to create more compelling information and it provides a lot of interesting information for clients and partners in the ad space,” Fuchs says. “They gain insight they otherwise wouldn’t get and that reinforces what we do on the Web and with mobile.”

Driving Readers
Meanwhile, Seventeen implements various applications to drive users back to its Web site by providing key information for giveaways, such as a necessary code that can only be obtained on Twitter, for instance. “Many will retweet friends to alert them that we’re is giving away something awesome,” says editor-in-chief Ann Shoket.
Seventeen currently has more than 30,000 followers on Twitter, which is steadily growing. “We want to be where people are. It’s never about the technology, we’re in the people business.”
The magazine also has several multi-platform programs in the works that are having a far reach among its young and tech-savvy readers.
In its August issue, it launched a program called, the “Beauty Smarties.” Ten real-girl beauty experts created beauty looks for the magazine.
Seventeen found the contributors because they were already “stars” on YouTube and brought to the table thousands of followers and millions of video plays, Shoket says. The girls are creating looks on Seventeen.com, on the Get Advice portion of the site, and they’re also using Facebook, MySpace and YouTube videos to drive users back to the site.

Boosting Reader Satisfaction
The payoff of multi-platform content can be great for publishers if done well. “Satisfaction hasn’t been this high with the magazine in a long time,” says Golf’s Fuchs. “The Web site is growing, and with specific channels with the Majors, the site has been much more active. We’ve seen phenomenal growth with mobile and social media platforms.”
The next big thing? To continue to think about content production as a platform, not just putting it in one place, but distributing it broadly and widely, Fuchs says. “It’s about thinking about your content as a platform itself.”

Reality Check

Changing of the Guard
The resignations of top publishing executives is adding up. In July, Jim Spanfeller said he will be leaving Forbes.com as president and CEO before the end of August. Less than two weeks later, Rodale president and CEO Steven Pleshette Murphy and Reed Business Information U.S. CEO Tad Smith resigned (on the same day) from their chief executive posts.
Do these departures represent a natural changing of the guard among top management, or were these longtime chief executives pushed out amid declining ad pages and dwindling revenues?

Quick Turnaround
In the case of Tad Smith, a pair of fellow b-to-b CEOs speculate he was planning his exit from RBI well before London-based parent Reed Elsevier put most of its U.S. properties back on the block.
“He couldn’t have relished the thought of going through another sales process on the heels of the earlier failed attempt,” one CEO says. “I don’t think his leaving will have much effect on the sales process, its outcome or what happens next. Management knows what it wants, which is out of the b-to-b publishing business.”
RBI’s executive vice president and CFO John Poulin was appointed acting CEO. According to one b-to-b CEO, the person who replaces Smith full-time will obviously depend on the buyer. “I would venture it will be somebody from outside b-to-b media,” one CEO says.
“Tad’s leaving means RBI gets to trim its corporate overhead, which is huge, and that he gets a payout on his contract,” another chief executive says of Smith’s departure. “No doubt, he was paid.”
Two weeks after resigning, Smith landed at Cablevision Systems Corp. as president of its newly-created local media group. “Tad was never a b-to-b guy,” another CEO says. “The fact that Tad landed this as soon as he did likely means he has been looking for a while. I would expect that this is an interim position until Tad gets his own deal running a media company.”
The source speculated that Smith might eventually wind up working with Strauss Zelnick, chairman of video game developer Take-Two Interactive. “They’re good friends,” he says.

‘That’s Just Crappy Reporting’
When Forbes announced that Jim Spanfeller was stepping down, news reports immediately speculated that the longtime online chief was pressured to leave by Forbes investor Elevation Partners. “That’s just crappy reporting,” Spanfeller told Folio:. “Unless Elevation Partners has the ability to stick thoughts in my head, they had nothing to do with my decision.”
Spanfeller—who plans to launch a media management firm this fall to manage and build up publishers’ online businesses—also discredited reports of being pushed out due to declining traffic at Forbes.com. “Even if one says we’re down slightly over a couple of months, the truth is that Forbes.com is up from half a million uniques in 2001 to 18 to 20 million today,” says Spanfeller. At presstime, the search for his replacement was still underway.

Getting Out While the Getting Is Good?
In announcing his resignation as Rodale CEO, Steven Pleshette Murphy said he decided not to renew his contract “to take time off to pursue my own creative interests.” Chairman Maria Rodale was tapped to succeed Murphy as CEO.
During his nine-year tenure as chief executive, Rodale says it experienced the most profitable period in its history. But ad pages across its six titles tracked by PIB were down a collective 17.92 percent in the first half of 2009.
“That so many CEOs are leaving or are being asked to leave isn’t surprising—it’s a time of turmoil and very limited success,” said one publishing CEO who wished to remain anonymous. “Almost every company is on a losing streak and, just as in sports, owners fire managers and coaches, not the players.”

Circ Xtra

How to Please ‘Repeat Blasters’ Without Fatiguing Your E-Mail Lists
At the 2009 Audience Development Show, Watt Publishing’s audience development director, Jim Wessel, shared some tactics for dealing with co-workers who insist on pummeling e-mail lists.
“We call him the ‘Repeat Blaster’ at work,” Wessel joked. “No one in the office knows what his real name is. He likes sending the same message every two days and you can’t change his mind.”
Wessel wanted a way to deliver the target audience without running the risk of fatiguing the list. So, he sent out a client-driven e-mail promoting their products as a test to 10,000 addresses from the promotions channel.
Out of the e-mails sent, 2,000 were opened and 1,000 bounced. Instead of blasting the entire list again, he removed the opens and the bounces for a second round—and continued that pattern for three more rounds.
Even though the response rate went down after each round, so did the amount of complaints. “You could also see another pattern,” Wessel said. “Out of those that did respond, the number of people who responded positively was about the same. After we got down to the fourth round, the advertiser was ready to buy four more rounds because the results were good all the way through.”
Wessel found success with using the same type of test for the “guy that sells open rate percentages.” For this test, he sent out a company e-newsletter to 20,000 subscribers, and 35 percent opened the e-mail. Wessel removed the e-mail addresses for those who did not open the message over a three-month period. For the second round, he sent out the e-mail to 12,000 addresses and got a 58 percent open rate.
“Our philosophy is that if you didn’t open it, you’re not interested,” he said. “So we take you out of the mix. Not only did we save money but we also boosted traffic. Our IP ratings went up because open rates went up. This is great for newsletters and monthly promotions.”

Sales

Selling Software: From Tracking Accounts to Pay-Up
Back-end sales software has evolved from simple tracking spreadsheets to full-blown customer relationship management systems. But day-to-day, which systems (and features within those systems) are the most helpful to magazine salespeople? This article asks a selection of salespeople what they find most useful and why.

Web-Based Systems
Web-based systems are gaining prominence, particularly as the demands of selling go beyond the office. Physician’s Practice has used Salesforce for the past five years. Two years ago the magazine was acquired by CMP Medica and, based on its experience, the rest of CMP Medica is now implementing Salesforce as well. “It’s all online,” says Physician’s Practice associate publisher Eric Temple-Morris. “Anyone who needs information can dial up and we share information in real time. It allows us to automate and customize messages and instead of sending out one mass e-mail, we can segment. We can tell who’s opening e-mails, who clicked on what. We do all reporting and orders in Salesforce; there is no manual reporting.”
The Magazine Manager has developed a following among both small and large publishers and recently launched a new version that offers production and circulation management and plans to add a digital edition soon. Regional title 417 uses the system for contact management, contract tracking and ad production. “Unlike a lot of magazines whose ads are delivered by an agency, we’re in a smaller market and we create at least 90 percent of the ads ourselves,” says general manager Joan Whitaker. “The production process is pretty cumbersome in terms of contacting advertisers and getting ads produced. The Magazine Manager has helped our salespeople as a sales contact system, letting them know when they were last contacted but also helps the production side by enabling them to pull down the ads that need to be produced for that issue.”
Northern Colorado Business Report uses The Magazine Manager for its “Flex Reports.” “We have three different journals and only one database and it’s a challenge to pull and sort the data by product and rep, with comparisons to goal,” says publisher Jeff Nuttall. “Each journal also has ancillary products like directories and events. But The Magazine Manager contains built-in Flex Reports that allow you to build what you need on the fly.”

The Balance Between Enterprise and Individual Solutions
Publishers should also consider that enterprise solutions may not necessarily deliver the right service for the individual rep. “I’m an ACT guy and McGraw-Hill uses Siebel,” says Keith Gregory, online sales manager at Aviation Week. “You tend to get two different mindsets for what salespeople need. Management wants reporting, while salespeople basically want smart index cards. The systems don’t always line up.”
Gregory likes ACT because, he says, it’s easy to use and lends itself to customization. “One thing I try to do for my contacts is create a source code of where that contact came from,” he says. “You can look at all the people who came from a certain source. ACT can create groups at tradeshows, find out who’s exhibiting, filter and then group, and when I walk the floor I can see which person I should ask for. There are some great things about Siebel, like the ability to see other reps and what they’re doing on the account but if I want to create a new contact, it takes 15 minutes. In ACT, it takes 30 seconds. If you want to help salespeople, I would recommend ACT, and then look to get an ACT Consultant and create a networked version for management. If you want something for management, that’s a different story. Then you are looking more along the lines of Salesforce or Siebel.”

Wish List
Like many publishers, The Atlantic is holding off on investing in an updated system this year. But as publisher Jay Lauf and his team assess systems, customization is high on their list. “The more customization they can allow, the better,” says Lauf. “I find that a lot of these systems are too stilted. Many just aren’t helpful enough. Salesforce seems to be one that offers flexibility and strong features and the ability to manage contacts on the fly on mobile devices.”
Emmis Interactive sales director Tricia Clarke-Stone wants to see a traffic system that goes beyond DART or Atlas. “Whether you’re local or national, most publishers are tied to display ads,” she says. “When you work with display ads, you hit a ceiling because everything is based on impressions. We’re not Google or Yahoo or AOL. We’re not going to generate more revenue than the impressions you can deliver.”
Instead, Clarke-Stone wants to see a system that can accommodate the multi-faceted programs publishers are now offering. “A lot of what we do is tied to high engagement programs and inventory,” she says. “That doesn’t necessarily need to be handled by an ad server. Those are sponsorships, mobile apps, etcetera. It would be great if there was something beyond the display ad system that could track some of the high engagement inventory and be used as part of the production arm.”

SIDEBAR
Sales Solutions Roundup
An overview of some of the leading sales software providers.

Salesforce
Clients: Reed Business Information, Smart Money
Client Quote: “I’ve used Salesforce and found it to be of tremendous benefit. I know it can be pricey but it’s a complete solution and one on which I successfully rely.”
URL: www.salesforce.com

The Magazine Manager
Clients: Renaissance Publishing, Financial Advisor
Client Quote: “It’s much more than a CRM. I wanted my CRM to interface seamlessly with all my other functionality across the business and that’s MM.”
URL: www.magazinemanager.com

ACT
Clients: Maitland Primrose Media Group, Print Solutions Magazine
Client Quote: “It is an affordable CRM that is easy to work with. Their mail merge system is great.”
URL: www.act.com

GoldMine
Clients: Salem Press
Client Quote: “We use GoldMine for contact and lead management. It’s very good.”
URL: www.frontrange.com/goldmine.aspx

Siebel
Clients: McGraw-Hill
Client Quote: “The best I’ve used so far.”
URL: www.oracle.com/us/products/applications/siebel/index.htm

August 2009

Dan Trombetto — Mon, 27 Jul 2009 14:57:11 -0400

Cover Story

The Big Idea 2010
We all know that the top strategic priority this year isn’t really “online,” or “lead gen” or “events,” it’s flat-out survival. Planning for the future now means the next fiscal quarter, not the next five years.
But that doesn’t mean publishers are curling into the fetal position. In this article, a mix of publishing executives share their ideas and plans they are putting into place as we move into the second half of the year, as well as frankly assess the strengths, weaknesses, opportunities and threats facing their companies.

Steve Churm CEO | Churm Media
Churm Media is enjoying an unlikely renaissance. As publisher of five titles tied closely to the new home market in Orange County, California, Churm saw 20 percent of its revenue disappear over an 18-month period.
The response was cost reduction (headcount shrank from 54 to 35 full-timers) and an aggressive digital push, including a $350,000 investment in Web redevelopment. “We’ve had Web sites since 2000 but they were exactly what you find in the magazine,” Churm says. “By the end of 2006, we said if we didn’t advance what we were doing on Web, we’d be in trouble.”
Churm revamped its sites, put them on a common CMS and began an aggressive e-newsletter push. “We started a daily e-blast called OC Metro that’s tripled traffic to our Web site,” Churm says. “Our greatest fear was we’d bleed our e-mail database from people not wanting to hear from us every day. We had some of that initially but now we have a better than 12 percent open rate. We’re generating $1,000 per week in advertising.”
Meanwhile, Churm added staffers with a better skillset and is using up to 10 interns on the content and production side.
Online revenue has grown by triple digits every month so far this year, according to Churm. “Every dollar we bring in online is equivalent to $2.50 on the print side in terms of cost of opportunity,” he adds. “We’re finding our stride in terms of monetization—we may finish 2009 with 10 percent of total revenue coming from digital and I suspect by the end of 2010 we could be at 22 percent. A year ago we were at 1 percent.”
The biggest challenge is getting sales staff to push online and in response Churm offers digital commissions that are about 10 percent higher than print. “I’m willing to invest now to get them across the digital divide,” he says.
Still, Churm realizes he’s walking a thin line with staffing. “How long can a small media owner ask people to continue to give the hours they’re giving? I’ve heard ‘a raise in this economy is just having a job’ but at some point people burn out. How do we address that? Right now we don’t have more money to send their way.”

SWOT Analysis
Strengths: An aggressive digital push has resulted in triple-digit online revenue growth each month.
Opportunities: Regional markets are clamoring for digital.
Weaknesses: Razor thin staffing.
Threats: “We really don’t know what’s out there 90 days from now.”

Stephanie George President | Time Inc. | Advertising Sales and Marketing
Time Inc. has gone through its share of streamlining, which included several rounds of layoffs that lasted into early 2009. But with all of that behind it, the company is now lean enough to put a strategic focus on the digital side of the operation.
This renewed focus is what Stephanie George, president of advertising sales and marketing, points to as a new strength for the company. “It’s important to point out the restructuring of the company,” she says. “That’s been the primary focus of this past year and now it’s so much easier to navigate when the company is streamlined and focused.”
To that end, Time Inc. has announced or hinted at a number of new initiatives—paid content models, for example—and George highlights the April launch of the Axcess ad network solution as a critical initiative for the year, and beyond.
Launched at the peak of broad publisher interest in the ad network concept, Axcess corrals all of Time Inc.’s Web assets into one umbrella network designed to make the buying process easier and emphasize the company’s brand strengths. “We’re being asked for higher accountability in our media partnerships, digital budgets are expanding, and there’s more trial going on in the digital arena,” says George. “We wanted to see if we could activate across our branded assets in an efficient way.”
The network, says George, combines the brand recognition of Time Inc. properties along with robust behavioral targeting backed up by the company’s research and insights division. Essentially, marketers can avail themselves of pre- and post-campaign behavioral studies and analytics to help them dial in their targets with the network’s 26 million monthly unique user reach across 26 Web sites. “The difference is, unlike a [third-party] ad network, you know where you are and you know who your audience is,” she says.

SWOT Analysis
Strengths: “We have huge audiences—103 million in magazines, more than 26 million in digital.”
Weaknesses: Print. The publishing division is perpetually speculated as a spin-off from Time Warner.
Opportunities: “We streamlined.”
Threats: “When you have the business scale that we do, your competitors are that much bigger—that’s something that we’re conscious of at all times.”

Jim Vick Publisher | IEEE Spectrum | President | Association Media and Publishing
Association magazine publishers have long waged the battle of getting enough resources from their organizations while trying to adapt to the changing publishing model.
“Our big idea is refocusing the mission of SNAP … changes that will enable us to better serve the needs of our members going forward in light of the issues we’re all dealing with in today’s publishing/business environment,” says Jim Vick, publisher of IEEE Spectrum and incoming president of Association Media and Publishing (formerly Society of National Association Publications).
According to Vick, the new name and repositioning will help accomplish several goals, including better enabling the group to focus on emerging markets and to focus on professionals who connect with association members in and outside of print publishing.
Vick says association publishing remains undervalued by many marketers, “simply because it’s the product of association publishing,” and as a result carries “undeserved negative baggage.” He says this happens because association media often is defined by its commercial competition rather than by association media sellers, or because commercial competition is entrenched and the buying habit is hard to break. “The entire publishing industry is in flux, perhaps creating an ideal time for association publishers to assert themselves to ‘earn’ greater monetary engagement by marketers.”
“Volunteer and staff association management must remain committed to their magazines and alternative media by maintaining the nerve to stay the course by continuing investment in providing their members with high quality media products,” Vick continues. “Associations are not immune to the complexities and challenges of operating fiscally responsible publishing operations. It’s up to the publishing professionals in these organizations to work closely with volunteer and staff management to interpret opportunity, define monetary resource requirements, protect the viability of the publishing franchise and manage publishing operations in a fiscally responsible manner.”

SWOT Analysis
Strengths: Publications are valued as members’ top benefit of membership—and tangible result of paying dues.
Weaknesses: Undervalued by marketers. Limited resources.
Opportunities: To better articulate the proofs that marketers require.
Threats: For-profit competitors. Inability to capitalize on internal opportunities.

Mark Lefens President and CEO | Marketing & Technology Group
As advertisers clamor more and more for detailed metrics—and publishers concede—Marketing & Technology Group (mtg) president and CEO Mark Lefens says that the company has the advantage of a “very deep profile on our readers.” And it’s mtg’s fully-authenticated site and metric-driven leads that he anticipates will drive business into next year.
“Our online growth focuses on user registration, as well as serving ads contextually on our site. This means they are served against specific categories of content that advertisers purchase,” he says. Lefens considers the next step for mtg to be a paid online model. “Since we are a content-centric company, I think we are in a good position for this,” he adds. In addition to paid content and utilizing deeper contextual Web advertising, he also hopes to make a real-time information push via mobile a consumer option for mtg’s Plate franchise (part of mtg’s Foodservice Group). “We’ll also be looking for partnerships and other areas to apply this model,” he adds.
Meatingplace, Poultry and CarneTec form mtg’s second group, MPC, which generally sees revenues run around 60 percent print and 40 percent online. Compared with the first half of 2008, this year’s revenues are flat, with print slightly down and Web slightly up.
Lefens also anticipates results from its three year initiative (2009 is year three), which have focused on improving content and design across multiple platforms.
Changes specific to its print products—like enhancing body paper stock from 45# Orion to 50# Somerset, raising trim size from 8 x 10.75 to 8.5 x 10.75 and adding a UV coating to its 100# cover stock—are just part of the overhaul, which also involves moving news stories and back-of-the-magazine products from print to online. Lefens hopes to further the distinction between “what should be in print and what should be online,” he says. “Our research shows that magazine readership is up 10 percent despite the tanking industry.”

SWOT Analysis
Strengths: Full authentication on its sites will deliver real-time leads. Internal integration of both print and Web.
Weaknesses: Lack of scale may cost mtg against established competitors in the foodservice marketplace.
Opportunities: Instituting a paid content model and a mobile push for real-time info.
Threats: Limited funds for development in marketplace.

Sarah Chubb President | Conde Nast Digital
Conde Nast Digital in July announced it spun out GQ and Details from the Web-only destination brand Men.Style.com. The move is the latest in an ongoing initiative to peel off individual brands to put the emphasis back on a site’s direct lineage to its print counterpart.
GQ.com and Details.com will go live in October. What’s left of Men.Style.com will be merged into the new GQ.com site. The strategy will continue into 2010 when the company expects to break Vogue out from Style.com into its own Web site.
This signals a softening of the portal strategy, but not a wholesale departure. Epicurious.com still lives on and the women’s portal, Style.com, will not go away either.
What CND has discovered is their flagship brands are better off as standalone Web sites. Men.Style.com began to overlap with GQ’s editorial mission and compete with Details, says Sarah Chubb, president of Conde Nast Digital.
And early this year, when Conde Nast consolidated its digital assets from CondeNet into Conde Nast Digital, there was an accompanying reexamination of resources. “It nudged me and the senior team to look at all the products to optimize them as their own businesses—looking at the advertising opportunities and doing as much as we could with limited resources,” says Chubb.
While the Men.Style site was performing well—40 percent growth in unique visitors in 2008 over 2007 and 45 percent growth again in 2009—it was becoming clear that the GQ brand was subsuming Men.Style. Most importantly, there were revenue opportunities, particularly with GQ, that could be optimized by spinning the sites off.
GQ’s share of traffic was 35 percent, much higher than the 10 percent the other magazine brands contribute to their portal sites, says Chubb. Additionally, GQ simply has more cache among the ad community. “[Men.Style] is successful with reader growth, but this was a very specific business decision to take advantage of the biggest advertising upside.”

SWOT Analysis
Strengths: Giving a flagship brand the air it needs to breathe re-establishes it with its audience and reconnects the print-to-Web lineage.
Weaknesses: Breaking up a portal could be perceived as a ceding of market control. And if the analytics aren’t fully leveraged, marketers could lose their enthusiasm.
Opportunities: Advertisers crave GQ’s cache.
Threats: Other players could move into similar areas with broad destination sites.

Dan Blank Director of Content Strategy and Development | Reed Business Information
When asked what his next big idea was, Blank replied, “I’m not looking for one anymore. I’m getting back to the basics.”
For Blank, who has spearheaded the growth of RBI’s blog network and worked closely with the editorial and the Web operations groups over the last three years, “getting back to the basics” refers to the company’s online editorial strategy. “I’m not a numbers guy, but I’m huge on Web analytics and search,” he says. “It closes the divide between the editors and the people they serve. It can get complicated, so it’s a big focus I’ll have going forward.”
With a goal of further integrating Web analytics into RBI’s brand strategy, creating and setting benchmarks, and measuring what’s working and what’s not, at the core of that focus, Blank says, is the journalist. “In terms of revenue, the role of the journalist has dramatically changed,” he tells FOLIO:. “There’s been a profound shift in that they are now the marketers. They’re not only responsible for creating content. They now have the responsibility of sharing that message, creating social media groups and looking at Web analytics.”
This shift was addressed three years ago through the creation of RBInteractive, RBI’s digital division. As part of the division, Blank encourages editors to rethink their blog strategy, test new ideas and partner with the sales and marketing teams to foster a better understanding of the industries the company serves. Once best practices are established, they are then shared across the company.
Blank’s goal is to continue to build roadmaps for RBI’s Web properties as well as its social media offerings. “It’s all about creating communities,” he says. “It’s fascinating the amount of social media tools that are at your disposal. Despite the changes we’re going through, journalists are more powerful than ever.”

SWOT Analysis
Strengths: B-to-b media is perfectly situated for online. Blogs, social media are a great way to reach niches.
Weaknesses: “We are a large company with a lot of moving parts, so change can come more slowly, requiring an iterative process.”
Opportunities: “Our industries are much more willing now to create and share. We’re no longer questioning whether social media should be a part of our brand.”
Threats: There are a lot more competitors online and they can pop up with very little overhead, especially as the economy downsizes.

Jeff Myers VP | General Manager | Meredith

The media industry has been buzzing about behavioral targeting for a while now, but according to Myers, contextual advertising should not be overlooked. “When you collect folks around a brand, you create an environment that thrives from an advertiser’s perspective,” he says. “For example, if you have a group of people who are diabetic and you reach out to them with content that is relevant, the response to the advertising will be very high.”
Myers has been collecting people around brands via content for some time now—and with great success. Diabetic Living, which launched as a print magazine two years ago, gained such following that a Web site was added this year—DiabeticLivingOnline.com last month had 350,000 unique visitors and four million page views.
Meredith did the same for its Mixing Bowl brand, but in the opposite order—the company took its successful social media site for cooking enthusiasts and spun off a print magazine. “Mixing Bowl is a good example of what we’re doing in a broader sense,” Myers tells FOLIO:. “We’re building products around audience that have a unique passion.”
Myers says the inspiration came from seeing the quality of the community that was rapidly growing—the site currently has 26,000 members, 15,000 recipes, 200,000 unique visitors and two million page views. The company felt that offering a print magazine was not only a way to extend the brand, but also a way to reward members and to get them to spread the word.
Myers added that Meredith has a number of economic advantages that allow the company to explore the print sector. “We have an infrastructure, deep pockets and not a lot of the costs associated with starting from scratch,” he says. “Our next goal is to just expose what we’re offering to a larger audience.”
For Diabetic Living, the company is planning to build a series of branded events as well an annual awards feature for the top-rated diabetes-friendly foods.

SWOT Analysis
Strengths: The power of the Better Homes & Gardens brand, which “resonates with consumers across platforms and products.”
Weaknesses: The pace of economic recovery could threaten rate of growth.
Opportunities: The ability to quickly grow market-leading digital properties.
Threats: The rapidly changing environment on and offline creates threats for those that fail to lead.

Donald Pazour CEO | Access Intelligence
When its ad revenue plummeted more than 30 percent in the second quarter, b-to-b publisher Access Intelligence was forced to undergo a significant reorg. Casualties included a staff reduction and the folding of Aviation Maintenance. But out of this shakeup emerged a plan based on generating subscription and event revenue to advance the company into 2010 and beyond.
Looking ahead, CEO Donald Pazour expects AI to continue to expand its “funnel model,” with e-media, no-cost community, social media and job boards at the top. “As you move down the funnel, the cost of entry rises to include assets like a store, educational and training resources, and an awards program. As you go even further down the funnel, readers can find premium information,” he says. This premium data is subscription-based, and ranges from $60,000 to $120,000 annually. Pazour hopes to expand AI’s premium information offerings, as well as reader spending.
For Pazour, subscriptions are key. “Over 52 percent of our revenue is subscription-based,” he says. Of this revenue, 65 percent comes from institutional subscriptions. Pazour recognizes the potential of higher renewal rates from institutional subscriptions over individual subscriptions, and plans to grow these in the coming year.
Access Intelligence’s July acquisition of Contexto Media, a Salt Lake City-based firm offering information products and software for the medical coding market, will help bolster the company’s offerings, as well as its subscriber base. (Contexto is almost 100 percent subscription-based, he says). Pazour anticipates growing subscriptions a total of 8 to 12 percent in 2010.
Another goal is to establish all of AI’s events as must-attends in their respective markets. And with revenues from its two biggest shows up in 2009 over 2008—and two recent energy market event acquisitions—he says AI’s “re-sign is trending for growth again in 2010.”

SWOT Analysis
Strengths: Information created from proprietary data and analysts is not subject to advertising volatility.
Weaknesses: Paid information hinges on b-to-b publishers employing e-media techniques and not falling back on practices used for controlled circulation magazines.
Opportunities: Acquisitions will bolster subscription-based assets and ramp up must-attend event offerings.
Threats: Pressure to utilize relationships and intellectual capital before competitive e-media pure plays catch up.

F. Blair Schmidt-Fellner President/CEO | Endurance Business Media
Print and online have swapped roles at Endurance Business Media, which serves the home market, with print acting as a marketing tool for the Web sites. “The magazines still get picked up, all 20 million of them,” says CEO F. Blair Schmidt-Fellner. “They point you to the Web and almost a third of our traffic comes from people looking at the cover of the magazine.”
However, monetizing Web listings can be a challenge in a market where the major real estate associations put up listings for free. “When real estate brokers go online, it’s usually code for ‘We’re not spending anything,’” says Schmidt-Fellner. “It’s hard to draw ad dollars when they can list on Yahoo for free. My guess is spending by real estate agents is down 40 percent.”
Endurance targets a higher-end crowd with its print and online products. “Our premise is that only higher-end homes buy an integrated package that includes the magazine and the Web site,” says Schmidt-Fellner. “We have more visitors that make over $150,000 in household income than any other realty Web site.”
Schmidt-Fellner warns that online competitors are different from print competitors. “You have to set up a strategy that addresses them separately,” he says. “What wouldn’t be helpful is, ‘I have a print product, I’m moving it online.’ We were already dealing with higher end listings in print and placing those copies in zip codes and areas where people of affluence picked them up. We’re only the sixth largest home site with 1.3 million uniques but all of our SEO efforts are designed to attract people who can afford $400,000 homes.”
Endurance has frachisees that cover the U.S. and the publisher charges its partners royalties for the print and online components.
Products can’t be static, particularly online. “The franchises actually sell the product to agents and they break it down into print and online as well,” says Schmidt-Fellner. “Each year it’s important to find really valuable things online that are new, sellable and helpful.”

SWOT Analysis
Strengths: Products targeting a more select audience than the association listings posted for free.
Weaknesses: A market under severe pressure.
Opportunities: Offering 360 degree viewing opportunities online, with print serving to market the Web.
Threats: “When real estate brokers go online, it’s code for, ‘We’re not spending anything.’”

Jim Casella CEO | Asset International
After serving as CEO of RBI U.S. (Cahners), then as vice chairman until January 2007, Jim Casella took the helm of global financial information publisher Asset International as chief executive late last year.
Since then, Casella has been busy trying to grow the business by looking at possible acquisitions. His idea for the remainder of the year, like a small handful of other private companies with strong balance sheets, or backing from private equity, is to take advantage of strategic assets for sale. “We view Asset International as a platform company to build upon,” Casella says. “We like their mix of products which include print and online information products, a strong event portfolio, primary research, and a data and analytics property.”
In June, AI acquired The Trade Ltd, the London-based publisher of The Trade and other products targeting institutional investors and the buy-side electronic trading community. At the time, Casella said the deal was the first in “a series of global media acquisitions” for the company, and that his space is particularly primed for deals. Casella said he’d like to quickly grow revenues to more than $100 million. (The company is still below the $100 million mark.) “It’s still early, but I trust that we will reach our target by 2010,” he says.
Part of AI’s growth is marked by its expansion into digital, and data and analytics businesses, like The Trade. Print will become a smaller percentage of revenue.
“We are looking to move all parts of the business to common digital platforms that are responsive to customer needs,” he says. “For example, we have added a very strong Webinar program for PlanSponsor that is packaged into a strong lead generation program for our customers. Stephen Moylan, who worked with me at Reed Business and International Data Group is working hard to make certain all of our properties are accelerating their digital strategy.”

SWOT Analysis
Strengths: A customer focus with a market sector that is looking for more transparency, something information businesses can provide.
Weaknesses: AI covers a market that’s been seriously hammered in the downturn.
Opportunities: More global growth facilitated by a strong branding program.
Threats: A failure to execute against its growth plan, combined with a longer economic recovery than anticipated.

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Competing For Web Real Estate
While most magazine companies will agree that the most important element of a Web site is the editorial content, there are many other departments that are vying for prime space on the homepage. The circulation team wants a prominent spot for its “Subscribe Now!” button while the sales team wants that top banner ad space. If your company happens to sell additional non-magazine products, they’ll want some space, too. So how do publishers negotiate who gets what?

At Hearst Digital Media, dedicated space is assigned to each department and all parties sign off on the template, according to SVP and general manager Chuck Cordray. The space each department receives is based on test results. “For example, we found that subscription marketing works better at the bottom of the page than [paid] ads do,” Cordray says. “It’s a good spot because subscription marketing tends to work best when the person is interacting with the content. They’re more primed to convert.”

But that doesn’t mean that departmental debates over the space don’t come up. “Each group essentially wants the highest and best placement but we’re seeing that it works well for us to rely on the data to tell us what to do,” Cordray says. “It’s really not any different from when a print magazine is deciding its layout.”

Group-Specific Performance Metrics

Cordray says that a different metric is used for each department to determine what space it will receive. For the editorial team, the company uses “content velocity,” or how many pages a consumer will click through before leaving the Web site. “The goal is to get consumers to read through 10 to 20 pages before leaving,” he says.

For advertising, Hearst looks at “clarity of experience,” or making sure that consumers are clear about the fact that they’re reading an ad. “We want them to know what’s content and what’s not,” Cordray says. “But we also want to offer them flexibility and variability. If everything’s always in the same place, that’s not a good ad or user experience. We have to keep our consumers visually interested.”

And for subscription marketing, Cordray looks at the overall yield per unique visitor—or how likely the user will convert—but the conversion of total traffic is most important. “So we would look at conversion in terms of percentages of uniques coming to the magazine sites as a measure of how we are doing overall, and then look at individual units, etcetera, as an element to maximize within that mix,” he says.

A Constant Battle

At Active Interest Media’s Yoga Journal, the topic of Web space is always up for negotiation. In addition to circulation, advertising and editorial, space has to be made for Yoga Journal’s product business, conference business, insurance program for yoga teachers and teacher directory. The situation got especially sticky in 2004 when Yoga Journal decided to rebuild its Web site.

“It was brutal,” says circulation director Barbara Besser. “Everybody was arguing that their business had to be represented with a prime space on the homepage. We would have group meetings to fight it out.”

The circulation department had some other advantages. At the time of the redesign, Yoga Journal made so much money from online subscriptions that no one suggested their placements should be removed. The team tested cover ads on the upper right and left hand section of the homepage as well as pop-ups in order to pull consumers in. And when it was time to prove that they deserved to keep their placements, the department spoke in dollars. “It’s better to talk in dollars than subs,” she says. “Selling $20,000 worth of subscriptions sounds way better than selling 2,000 subscriptions.”

Still, it’s online editorial director Andrea Kowalski who makes the final decision regarding Web space for Yoga Journal and Vegetarian Times. “Because of my background, I’m a bit biased, so while I’m looking to accommodate all of the departments and revenue streams, I’m also conscious of the user interface. That’s why we have a prominent editorial well where readers know that they can go to and not be solicited or sold to.”
Establishing the Digital Rate Card
Digital editions have been positioned as value-added for so long that first attempts at developing an advertising rate card can leave publishers at a loss.
Some publishers don’t charge for ads but do charge for extra features (including making ad links live, something some digital vendors frown at). “It is very rare we will offer advertising in a digital edition only,” says Graduate Prospects sales director Allan Brown. “If the paper product is the lead we tend to add in the digital as part of the package at no cost (added value) for a straight replica of the ad. Then we up-sell features in the digital edition such as animation.”
When digital editions are the lead, Brown says he can charge higher rates for that than other online products.
ITEM Publications’ Interference Technology has several digital editions for the Asian market. All ads from the print product are featured in the digital edition but only those advertisers paying a 12 percent optional premium of the print are included in search results and receive reader tracking.
Charging on a CPM basis is risky, since digital editions typically have fewer readers than Web sites (although vendors claim readers are more engaged). When skateboard title SLAP went all digital, the publisher tried to get print advertisers to commit to spending the same monthly ad dollars based on a industry standard, impression-based CPM. “We had a huge amount of Web traffic already in place that easily ate up all those impressions,” wrote group creative director Kevin Convertito on FOLIO:’s mediaPRO social network earlier this year. “If you don’t already have a Web presence and active community, you probably can’t afford to go that route.”
Pricing can also depend on the digital format, such as the flip-page style or a vertical scrolling HTML. “For high-traffic, HTML-based sites, you could sell a combo of impression-based, click-through, and time-based sponsored rates, but for smaller, niche stuff in the page-flip format you’d probably do better to try and sell added value like active links and embedded video for much higher CPMs,” Convertito added.
Paid Content and Blog Sponsorships Generate Highest E-Profits
The wisdom of paid online content is still debatable but blog sponsorships and paid content are the most profitable e-media revenue streams, with more than 50 percent of respondents saying they see a profit margin of more than 30 percent from these two areas, according to the 2009 FOLIO: E-Media Survey. However, just eight percent of publishers sell sponsorships against blogs and only 28 percent offer paid content.
Of course, that doesn’t mean blogs and paid content are generating significant revenue at this point. Paid content is the fourth largest e-media revenue stream for magazine publishers today (banner advertising remains number one).
However, 32 percent of respondents say banner advertising was the least profitable e-media revenue stream, generating profit margins of less than 10 percent, followed by online directories.
The 2009 FOLIO: E-Media Survey tracks e-media performance for magazine publishers including fastest growing revenue streams, product pricing, product investment and e-media profitability. The survey will be available in full later this year.
Self Boasts Most-Read Feature in Q2, According to Survey
Recent research from Affinity’s VISTA Print Rating Service for the second quarter reports Self’s June “20 Ways to Eat Healthier Right Now” as the most-read story, with 90 percent of the surveyed readers recalling the article (Total Readership), and 85 percent reading more than half of the feature (Extent of Readership).
Average readership as measured across all articles was 61 percent from April through June, which bases its data on readers surveyed on over 100 consumer magazines and more than 1,000 articles.
While these ratings may not guarantee newsstand longevity—or successful growth in ad pages—these five features can offer insight into what’s resonating with readers.

#1: “20 Ways to Eat Healthier Right Now”
Self
June 2009
Total Readership: 90%
Extent of Readership: 85%

“The tips are free and easy to try, so readers can take action right away, which is a successful formula for Self’s editorial content overall.”
—Kimberly Kelleher, vice president and publisher, Self
#2: “The Green Energy Economy”
U.S. News & World Report
April 2009
Total Readership: 89%
Extent of Readership: 75%

“[Writer] Kent Garber presents a compelling tour d’horizon of one of the nation’s most vexing issues. With a firm command of the material, he explains not just where things are going in the great energy nationalization debate, but also outlines the bumps in the road in getting there.”
—Margi Mannix, executive editor, U.S. News & World Report
#3: “Hot Nights Out!”People StyleWatch
June/July 2009
Total Readership: 89%
Extent of Readership: 73%

“This reinforces what we’ve been sharing with advertisers, which is, readers have a connection with our content and are making purchases directly from the pages of StyleWatch.”
—Michelle Myers, publisher, People StyleWatch

#4: “How Our Salaries Are Changing”
Parade
April 12, 2009
Total Readership: 89%
Extent of Readership: 53%

“This was the lead article in our annual ‘What People Earn’ issue, which is among our most popular. It provides readers a rare peek into their neighbors’ pocketbooks. At the same time, people are clamoring for information that can help them navigate in this troubled economy.”
—Randy Siegel, president and publisher, Parade

#5: “I Am So Alone”
Us Weekly
April 20, 2009
Total Readership: 88%
Extent of Readership: 73%

Us Weekly shines in the celebrity gossip category with an exclusive cover story interview with emotional rollercoaster Lindsay Lohan. The feature discusses her split from girlfriend Samantha Ronson, a “humiliating” weekend showdown with Ronson’s family, and why friends’ fears she is suicidal are unfounded.

See the full top ten list here.

Source: Affinity’s VISTA Print Effectiveness Rating Service; Top articles by readership (April through June 2009). Ties in rankings broken by extent of readership scores.
Top Emerging Jobs In Publishing
It may be difficult today to imagine room at a publisher for new or emerging job titles. In a recent study conducted by ABM, 73 percent of b-to-b member company respondents say they’ve reduced or frozen hiring. Yet as we perpetually note, the publisher that manages to drive new business during a down economy will be much more likely to emerge the market leader on the other end. Because of that, publishers are looking for talent that can play a leadership role in those new initiatives, and more often than not, these positions are brand new to the organization.
We’ve interviewed several publishers to get a sense of what these jobs are and where in the company they tend to fall. In some cases, titles have not been defined yet, but clearly every new position is deeply influenced by the multiplatform direction magazine publishers are taking.

Director, Audience Recruitment
Salary Range: N/A, senior-level, VP position
As publishers refine their ability to better segment and target their customers, traditional “batch and blast” marketing strategies are slowly fading away. But the ongoing recruitment of new customers requires that same laser focus. Consequently, Everything Channel, a division of UBM, hired a director of audience recruitment whose sole responsibility is finding and qualifying new customers. And now that print is only 10 percent of the group’s revenues, qualifying new customers no longer follows BPA-style conventions. “We have a team of analysts that figure out what the universe looks like in their vertical, how many companies it has, and who we need to match to the products we have. It’s a very different role and not as focused on BPA requirements,” says Kate Spellman, senior vice president, marketing and business strategy at Everything Channel.

Director, International Conferences
Salary Range: Starts at $100,000
Many publishers are turning to international expansion as both an opportunity to leverage new business and seek relief from a beleaguered U.S. economy. Licensing print brands has been one method, but events are proving just as viable. “We are looking for people who can run events for us in far-flung places,” says Carol Evans, president of Bonnier Corp.’s Working Mother Media Group. “We just came back from India, Brazil, South Africa and China. We had to build an in-house department for the global execution of events.”
Evans says they’ve tried outsourcing the job, but prefers someone who can do it in-house. The job, says Evans, requires the typical event expertise as well as a facility with languages and international protocol. “Honestly, a lot of companies are looking at this because their customers are asking them to be global because they are,” she says.

Marketing Director
Salary Range: $110-$135,000
This title might sound traditional, but the marketing and business development practices now required are far from the usual, and this title is not relegated to a magazine division or group. Tasked with integrated programs coupled with research and data to provide accountability, the position requires a strategic level of thinking about deliverables. “People want fresh ideas,” says Evans. “They want you to not just generate, but execute. It goes way beyond a lunch and learn.”
And going beyond “lunch and learn” means non-advertising-based programs. “Customers really want programs where they can influence a customer with a product experience,” adds Evans. In this new marketing role, that requires combining digital products with an event along with some research thrown in.
Ironically, all the attention on integrated programs, says Evans, has managed to generate more advertising revenues. “The creation of non-advertising revenue has created capabilities that come back into creating integrated programs to generate ad revenues. And this is what people want. They might have asked an agency in the past, but now they’re asking a media company to deliver the whole thing—research, events, advertising and the Web,” she adds.

Associate Web Site Producer (“Search Warrior”)
Salary Range: $62,000 (per Salary.com)
Publishers have become adept at creating and repurposing digital content—editors generally understand the nuances of writing for the Web. Yet what has emerged is a position that can oversee the traffic-generating implications of all that content, something editors know a little about, but not all. “It’s pretty clear that we know how to create content for human beings; it’s less clear that we know how to create content for bots,” says CNNMoney.com editor-in-chief Chris Peacock.
The associate Web producer, casually called the “search warrior” at CNNMoney.com, helps build editorial products by looking at them through the lens of a search bot. As content is produced—articles, video, slide shows, and so on—the associate Web producer makes sure it’s all properly search optimized.

Product Director, Web
Salary Range: $144,000 (per Salary.com)
The Web product director is the link between editorial, business, design and development on the digital side. In other words, every Web site has a strategic roadmap and each component, whether content, sales, design or technology, plays a role in that strategy. The product director makes sure those roles in aggregate dovetail with that roadmap.
“It requires a deep focus on journalism, plus an engagement of all these other factors too,” says Peacock. “When we were a smaller site we had a project manager. When we became bigger, we learned that we really needed a product director—someone to work between edit, design, engineering and the business side to make sure all the components are brought together according to our strategy. This person manages execution, which crosses all of those lines.”

Director, Technology Innovation
Salary Range: Starts at $75,000
Technology is expensive and extremely difficult to implement. Having a person on board who not only understands the specifications needed to develop back-end technology, but also what makes the most sense for a particular environment, can ease the pain.
For many publishers, this position would have been invaluable five years ago when they were building their first huge, customized and ultimately unscaleable CMS systems. “They develop the kind of rich spec-level documentation that gets handed off to IT (a systems analyst job), but the typical systems analyst just gets what you want and translates it for the programmer,” says Alec Dann, general manager of business media online at Hanley Wood. “A technology innovator can tell you what you want and also knows the best way to tackle it. Are there technologies freely available on the Web instead of developing it ourselves?”
The technology innovator is tasked with increasing functionality of a Web site through new products and tools without jamming the development pipeline or incurring more costs.
“The role is one that gets at an itch that a lot of publishers have these days,” says Dann. “Technology is supposed to make things easier, but it’s actually harder. The innovator does what a tech entrepreneur does, which is to make it easier, keep the company in touch with the cutting-edge things and take a lot of that heat off the development pipeline.”

Data Quality Expert
Salary Range: $75,000-$80,000
Publishers that serve overlapping markets have made content re-use a critical part of their strategy. On the digital side, mapping that content in the content management system is a key function.
Tagging content requires a large library of keywords organized into complicated taxonomies. “The data quality position comes out of a need for content re-use, which is a key strategy for us,” says Hanley Wood’s Dann. “The position manages our controlled vocabulary of tags that we use to help aggregate content. Our multiple content domains overlap each other so it’s important to get it right.”
The position also manages the relationship of the advertising tags to the content tags—“In terms of not just creating them but on an ongoing basis verifying that everything is mapped to something else,” says Dann. “You might have 150 words in your controlled vocabulary. Do you have stories tagged to them all?”

Face Up

Face Up: California
MAGSTATS
Issue: May/June 2009 (relaunching as quarterly in September)
Frequency: Bi-monthly
Launched: 1897
Circ: 95,000
Editor-in-Chief: Wendy Miller
Publishing Company: California Alumni Association
Design Director: Michiko Toki
Magazines are certainly no strangers to bare-all issues. This year alone, Jennifer Aniston, Sacha Baron Cohen and Bar Refaeli—to name only a few of many— have appeared au natural on the covers of GQ and Esquire (much to the chagrin of Hudson News).
But when the newsstand proposition is taken away and replaced with a readership of university members and alumni, the rules are altogether different.
“The trickiest part is that we cover such a huge demographic, from the class of 1928 through 2008,” says California design director Michiko Toki on creating its May/June cover. “We wanted to do something provocative, but couldn’t go over the edge since we represent a university.”
Published by the California Alumni Association, California is sent to around 95,000 members and alumni of the University of California, Berkeley. The magazine began this issue’s planning months in advance, says Toki, who credits managing editor Katherine McKinley with the initial inspiration. “She [Kate] joked that the cover would have to be wrapped up in brown paper, which set off the idea,” Toki says.
One of the naked issue’s first iterations, says Toki, included shag rugs and animal print, but it was decided that this was too subtle. Toki graduated to using partial body images to hint at nakedness.
The final version employed a stock image of a naked back with the bottom two thirds of the cover obstructed by a (photographed) brown paper wrapper, like the ones commonly used decades ago to hide risque magazine cover art. Toki physically tore the brown paper to expose readable, minimalist coverlines.
Toki added a postal-required white inkjet label onto the package design, using actual rubber stamps to give the appearance of a shipment. “When we couldn’t get the stamps to bleed, we used Photoshop,” she says. “Sometimes the heightened reality is actually more real.”

DESIGNERS' COMMENTS

“The cover is conceptually strong, at least for people over 30 who are aware that porn magazines once shipped in plain brown wrappers. From a newsstand perspective, it’s a winner—it would definitely catch my eye. If the paper had covered less it might be more interesting to look at while still conveying the idea. The word ‘confidential,’ however, says ‘government secrets,’ not ‘hot nudity.’ A word cut off on the top left is not identifiable, and the gold bar clashes with the brown paper. The color choices on the nameplate and blurbs vibrate, with the ‘le’ in ‘leading edge’ washed out over the photo. Nice job with the rubber stamp effect on the issue date and Web address. Great concept, but the delivery could have been more polished.”
Jamie Stark | Stark Designs, LLC

“About nine years ago, I created a similar cover on the subject of pastors and porn. The idea of risqué magazines in brown wrappers wasn’t a too-distant memory. Does the concept still work? I’d have to say that the AD pulled it off (no pun intended) rather well. The use of the paper label for the actual inkjet application, element placement, and a great deal of info packed into such a small area of cover makes for a successful design. And does the cover entice the reader to explore the contents of the magazine? I’ll let you answer that.”

Gary Gnidovic | Design Director | Christianity Today

Have a unique “cover” story? Contact FOLIO: Associate Editor Vanessa Voltolina.

Best Practices

A Mag Poised For Shutdown Finds New Life
When Harbor Communications got wind in 2007 that Penton Media had decided to shutter Convenience Store Decisions, it pounced with an acquisition offer. Partly because Harbor co-founder Bill Donohue (and a former Penton retail division head) first launched the title back in 1990, and partly because Harbor sees an opportunity in print that many larger publishers no longer do.
“This was an attractive opportunity for us,” says Harbor president and co-founder (and former Penton president) Dan Ramella. “We approached them in October 2007 and the deal was finalized in about 30 days. We knew what we wanted; we were buying the brands and lists.”
In fact, the deal was done so quickly that the last issue under Penton’s ownership featured a farewell note from editor John Loftsock (who joined Harbor).
While editorial quality remained high and Penton previously invested in maintaining the circulation file (41,250 multi-unit executives), sales was neglected. At the time of acquisition, CSD had just four signed ad contracts for 2008. “This was late in the fall selling season and we had missed a huge industry show,” says publisher John Petersen, who joined Harbor from Penton. “By the time we got our team situated and took complete ownership, we were kind of up against it for 2008.”
Still, the fact that sales and marketing needed the most attention was a relief for Donohue, who pounded the beat with Petersen and group publisher Tom McIntyre. “When the owners are the day-to-day sales reps, that tells the marketplace they’re dealing with the key decision makers,” says McIntyre.
By the end of 2008, CSD had 58 advertisers. Through June 2009, the magazine has added 40 new advertisers on top of that and ad pages are up 83 percent through May, according to Patterson Advertising Reports.
No changes were made to CSD’s pricing (the 6x rate card is $6,169 net) and McIntyre says Harbor weeded out some of the bad inherited contracts and promised advertorials.
“When ad pages drop, edit pages usually drop,” he adds. “We promised a minimum 64-page folio and at least a 50/50 ad-to-edit ratio.”

Ancillary Opportunities
Part of the CSD acquisition included a Web site and a dormant association called the National Convenience Store Advisory Group, which Harbor plans to revive.
The association was purchased on Donohue’s watch at Penton. While the National Association of Convenience Stores caters to the larger chains in the industry, the National Advisory Group was targeted to smaller chains with 10 to 100 stores. “We had to fix the magazine first but we’ve had a lot of questions from retailers about bringing it back,” says Donohue.
CSD will host a reunion for the association in November and will talk with retailers about what direction it should take in 2010 and beyond. “We want this to be a retailer-run association,” says Petersen. “If we do that right, the other side of balance sheet will take care of itself.”
While the Web business remains relatively small for CSD, online revenue is up 35 percent and the brand has a goal of $100,000 in 2009.
Harbor has added a video player and weekly e-newsletters. CSD also does an annual three-part Webcast series. Sponsorships range from $3,500 to $10,000 per Webcast. Sam’s Club was the exclusive sponsor in 2008 and McLane took this spot in 2009. “It’s tough for a lot of people to travel these days and the Webcast enables us to deliver good content and research to their desks,” says McIntyre.
Still, the print magazine remains the core product for CSD. “There is a lot of buzz with digital but it depends on whether your market wants it,” says McIntyre. “Big publishing companies are really taking the spotlight off of print but I’m a big believer in print. I’m a believer in digital, too, but print is not dead and it doesn’t have to be unless you don’t pay attention to it.”
A Regional’s Content Facelift Yields High Returns
When RMS media purchased Northshore in the spring of 2005, “It was a staple-bound, 36-44 page advertorial-format magazine that looked like a direct mail piece,” says RMS Media Group president Rick Sedler. The then four-year-old title, which served as a regional lifestyle magazine for the North Shore area of Boston, was acquired from an independent self-publisher for approximately “an eighth of its total worth today,” says Sedler. At the time, a mostly freelance staff was orchestrating the final product, which had a circulation of about 15,000.
But Sedler had bigger plans for the regional title. Upon purchase, he expanded its circ to 30,000, including 25,000 sent to subscribers and via direct mail, 2,500 newsstand copies and 2,500 event/hotel copies.
It wasn’t until 2009, a time that much of the industry would rather forget, that Sedler made the strategic decision to increase his staff. Ultimately, the magazine has realized second quarter growth of 10 percent over the same period in 2008, says Sedler, bouncing back from a 20 percent loss in the first quarter of 2009. The magazine also hit advertising, circulation and production targets for the first half of 2009.

Culmination of ‘Connected’ Hires
Northshore’s success, says Sedler, is a combination of factors including the culmination of recent decisions like hiring “connected” and “experienced” staff, and building on the magazine’s track record with advertisers. Despite layoffs across the industry, the Andover-based title recently hired full time staff to replace its freelancers, including a director of new media, a creative director, a designer and two new sales people. Its new creative director is a former creative director from Boston, and its director of new media is a former FOX TV affiliate new media Web site expert. The move from freelance to full-timers increased the staff by 60 percent, says Sedler.

Removing Weaknesses
“If you can focus on taking out the weaknesses in your business, it’s a formula for success,” says Sedler. “We looked at all parts of the business that were our weaknesses and worked on correcting them and building out fresh new ideas.” In addition to deciding to triple its photo budget, Sedler also worked to add sections to Northshore’s formerly “lackluster” Web site. These included a business directory, sponsored e-mail marketing campaigns and banner ads, which implemented over the past nine months have helped boost site traffic threefold.
The title has additionally worked to make connections between its Web and print assets, tying its online stories and promotions back to the magazine in hopes of driving readers to nshoremag.com. “We turned our weaknesses into value propositions,” Sedler says.

Higher Growth Goals
The August/September “best of” issue has reaped the cumulative benefits of Sedler’s new staff and editorial modifications, showing a 25 percent increase in sales revenue over any previous issue. This success in the sales realm makes its 2009 “best of” issue its most profitable to date.
“We had four people selling on this issue as opposed to two,” he says. “While of course there are increased costs by bringing people on board, I put higher growth goals in place.”
If the growth of its assets continues as expected, Sedler anticipates Northshore’s circ to grow by 10 percent through the end of the year.

Columns

Conducting An Opportunity Audit
You might think that conducting an “opportunity audit” is a result of budget cuts and declining responses. Well, you’re right. However, it is really just smart marketing. Optimizing every visitor touchpoint provides better customer service, improves retention and drives incremental new and renewed subscribers.
I recently read an article about Web design and it stressed the importance of having a “maniacal focus on the customer’s experience.” I realize that audience marketers aren’t involved in Web development and I don’t see us becoming Web site usability experts any time soon (we have enough to do), but I do see us missing opportunities when it comes to form design, auto-responders, confirmation pages and acknowledgement e-mails. Audience marketers are the logical “owners” of this marketing real estate, we just need to take charge.
Recently our audience marketing team initiated an “opportunity audit.” I challenged the team to go through their assigned Web sites and sign up for everything, subscribe to everything, buy stuff, cancel stuff and opt-out of everything.
The team gathered screen shots of every step they encountered and as a group we evaluated our many customer touches. We quickly noticed that not only had we gathered lots of examples of lost opportunities but we were also staring at some very bad marketing copy and customer service practices.

‘We Have Confirmed Your Removal from the Following...’
This sounds like we are referring to waste removal and your customer might feel like they are the waste being removed. Sadly, this is the “marketing” copy presented after someone unsubscribes from one of our e-newsletters. There was no “thank you,” no “are you sure?” or “maybe you’d be interested in one of our other newsletters”—nothing, just waste removal.
So who wrote this copy? A well-meaning, highly-skilled Web developer that did not think he was going to be writing marketing copy when he took the job. Each time a confirmation page, acknowledgement e-mail or any kind of auto-responder is presented, it is likely to have been written by your technical folks or your fulfillment bureau. As a result, you miss an opportunity to cross-sell newsletters and subscriptions, sell products, or even provide a link back to your Web site, all of which can deepen your relationship with that new subscriber or visitor. By the way, your Web developers will love you for providing them with that marketing copy.

Landing Pages, People, Landing Pages!
You’ve worked hard to develop an effective renewal e-promo and your call to action worked perfectly, then the customer clicks and lands on the most unappealing subscription form. The same one your fulfillment bureau designed for you and every other publisher.
Subscription forms should be consistent with the look and feel of your promotions and your brand; plus, you should re-state the benefits of subscribing and provide a few images of the publication. Just because someone made it to the subscription form doesn’t mean they will be inspired to complete the transaction.
In your acknowledgement e-mail, give your new subscriber a way to “invite a friend.” Here is a great opportunity so please don’t land your new “friend” on that dreadful fulfillment bureau-issued subscription form. You need to sell your publication to this new prospect.

Don’t Just Renew, Then Walk Away
This is not the title of a country song but the way we sometimes behave once we’ve captured that annual renewal or requalification.
These are your best customers, so reach out to them outside the scheduled renewal series by sending a “What’s new on our Web site” or an Issue Alert reminding them of all your publication offers. Be sure to include links to popular or timely articles and blogs, or invite them to join your new Facebook group.

Build a Preference Center
Anytime a subscriber decides to opt-out of a newsletter or promotional e-mail, they aren’t necessarily opting out of everything you send them. Build a preference center that allows a subscriber to choose what newsletter or type of promotions they prefer. Maybe they still want the newsletter, but would prefer receiving it only once a month. Maybe they would like to just receive breaking news. Giving your subscribers choices keeps your e-mail lists from eroding.

Christine Oldenbrook is director of marketing/e-media at Bobit Business Media.
The Need to ‘Slice, Dice’ Online Content
For decades there were three major TV networks that tried to be all things to all people. A few new networks appeared in the 1980s. One (FOX) focused on terrestrial broadcasting, but most (like CNN and MTV) were part of the cable TV revolution. In the 1990s, as cable became more available and increased the number of available channels, many more appeared—most focused on specific topics.
The emergence of the Internet accelerated the pace of new channel creation. New networks sprang up almost overnight. Going direct to the consumer became a concrete possibility for content producers. As consumers, we reap the benefit on a daily basis: endless choice and lower prices.
But there is a darker side to this equation. Traditional media companies—broadcasters and print publishers— have to adapt to this new environment.
Simply moving online may or may not ensure survival—let alone profitability. The key is to re-invent the business such that the advantages once enjoyed become advantages that can once again be exploited. Every large publisher or broadcaster has two key advantages: quality and breadth. Bringing these to bear against many small competitors can be hard. The cost of creating new channels—cable, terrestrial or online—remains relatively high for most large organizations.

Building a Network of Content
In the early use of the Internet, individual publications and channels took the first steps, creating Web sites that complemented or supplemented their traditional model. Each was built separately, probably using different technologies. How does a broadcaster with 500 shows end up with 50 Web sites? It’s simple—the most popular programs build their own Web sites.
The cost to build each site using the same approach as the previous 50 they built will be prohibitive. So they won’t build out the vast number of channels their content might support, and consumers will look elsewhere.
Beyond the basic “onlining” of existing channels comes the creation of wholly new ones. We have seen remarkable changes in the world in the past year. How will a traditional publisher, with limited ability to create new channels at low cost, bring its breadth and quality to bear on a major celebrity crisis? How will traditional publishers compete with fully personalized models— like iGoogle and MyYahoo!—where each customer effectively creates their own “channel”?
The answer is that many of them won’t. Smaller, more agile players will provide the content, or the lens through which to view it—and profit handsomely.
Traditional publishers need to set themselves up so that all of their content can be sliced, diced and delivered in any way imaginable—with minimal effort and at low cost.
They need to build an Agile Content Network (ACN) that enables them to bring their quality and breadth of content to bear through this implementation.

An ACN has the following components:
• A logical index of all content available to the network (ideally all titles/channels)
• A content management system (CMS) integrated with the index, and capable of rapidly creating new channels by selecting a template
• Back-end capabilities (such as ad-serving, authentication, personalization, recommendations, threaded discussions) that are functionally integrated into the channel by the CMS templates

The ACN process can be simplified by taking an existing content delivery system and gradually migrating other sources and back-ends to it.

Internal Versus External Data
You may need to add a unified information access (UIA) solution to your existing stack that will allow you to query the (typically unstructured) content and related structured information such as subscription or permission data, rights information, popularity metrics, etc. The search engine built into the average CMS is intended to deal with the internal silo of data—the CMS’ own—and not external data.
The competition is not going away; it is going to get worse. Publishers that implement ACNs will adapt and survive ... and survival is indeed the question.

Sid Probstein is Chief Technology Officer at Attivio, responsible for technology strategy and innovation. Sid brings to Attivio more than 15 years experience leading successful engineering organizations and building complex, high-performance systems. Previously, he was CTO at
GCi, where he headed up development of the company’s next generation commerce platform.

Features

The State of Publication Printing Technology
Virtual proofing. Ad portals. Automated workflows.
Even as the print workflow becomes increasingly digitized, the fact remains that most of what we’re dealing with is mature technology for a mature business. But that doesn’t mean there aren’t new services saving the day (and chronic problems yet to be resolved). Here, production and manufacturing executives weigh in on the tools that have been the biggest benefits to their jobs—as well as problem areas where they want to see more from their printer partners.
Quebecor World executive vice president of market development Sean Twomey says technology only matters if it drives client benefits. “While press and bindery technology continue to advance, it’s how you use the state-of-the-art equipment in a networked fashion that makes a difference,” he adds.
The four areas of importance according to Twomey are manufacturing flexibility; color management; speed-to-market and creativity. “We have launched our Web-based, High Impact Showcase to show multiple examples of creative and technical print solutions that drive consumer interaction, consumer recall and consumer action,” he says.
For b-to-b giant Advanstar, co-mailing and closed-loop-color have had the biggest positive impact. “Co-mail has made a significant decrease in our postage costs,” says corporate director of media operations Keith Hammerbeck. “This has worked very well for standard size books that do not polybag. It has not worked very well for tabloids and polybagged issues. Our printer, however, is now coming out with a much better solution for handling polybagged standard size publications.”
Meanwhile, closed-loop-color is helping with some challenges. “It’s made a big improvement in color consistency and improved color reproduction,” says Hammerbeck. “It has also helped reduce paper spoilage. There are still some challenges in getting information out of the closed-loop systems in regard to what percentage of the run stayed within plus or minus of the specific color target.”
Several publishers cited B.Direct—Brown Printing’s integrated version of DALiM MiSTRAL’s project management and job tracking system—as a step forward. “I’ve been using InSite for years and recently started working with B.Direct,” says Jodie Wennberg, associate manufacturing director at Dwell. “It has an added benefit of providing form inlines with thumbnail images. This has allowed us to discuss inline scenarios with our printer in advance and troubleshoot problems. We may not be able to change the situation, but we can provide detailed information for the pressman regarding what to focus on or favor.”
Trade title Dentistry Today previously used Quickcut before turning to B.Direct. “[Quickcut] was charging us so much per inch for the advertising and another rate per inch for our editorial content, it cost us somewhere between $2,500-$3,500 per month,” says production manager Jan Marie Nigro. “We now have the ability to upload, print-off-proof and okay the magazine in one day.”

The Ups and Downs of Digital Publishing
A novelty just a few years ago, soft-proofing has gone mainstream. “Sending ad materials digitally has allowed us to extend our materials deadlines and accept ads later in the process,” says Eileen Rhine, production director at Outside. “Soft proofing has also given us more flexibility in our editorial workflow.”
Still, issues remain. “I believe that some of the costs associated with supplying ad materials have been transferred from the agencies/advertisers to the pubs/printers. Cost savings have been partially offset by additional expenses,” adds Rhine. “Fewer ad proofs are being supplied, and occasional errors in supplied materials are more difficult to identify and correct.”
In-house pre-press has had a positive impact on Travel Weekly’s production workflow by allowing the publisher to accept digital material via the Web or FTP site and then immediately process that material to place on page dramatically cuts down time.
“Recently I received an ad and was processing it to send to the printer and I noticed some copy was extremely close to the trim,” says production supervisor Michele M. Garth. “I was able to contact the advertiser, receive a replacement file, process the file and send the page to the printer all within the hour. A problem like that would have taken days to resolve in past workflows.”
Hearst, which uses Adobe InDesign, InCopy and K4, has done its own edit pre-press for the past five years, eliminating the editorial production department. The publisher has reworked its pre-media department within the larger production and manufacturing department to include staff with edit production experience. “This is a four-person department that processes all final edit pages for 15 titles,” says director of editorial operations Ellen Payne.
Kodak’s Prinergy and InSite pre-press portal have had the most significant impact for Hearst’s editorial production.
“We’ve really customized Prinergy to our workflow using their rules-based automation,” says Sean Keefe, director of editorial products at Hearst. “That’s enabled us to roll out virtual proofing both on the press side and at the magazines. Half of our magazines are already virtual on the press side and two to three are virtual internally.”
This enables Hearst to deliver PDF-X4 files rather than PDF-X1s. “This is a huge advantage for us because the final PDF files are no longer being flattened,” says Keefe. “‘Rasterization’ goes away and our printers use the Adobe Print Engine to process final files. Because we don’t have to flatten files on the edit side we can take advantage of layering InDesign to automate more tasks.”
Hearst also uses a plug-in called MadeToPrint that automates tasks that normally would be manual. “We usually make our contract proof and final proof PDFs and it splits these pages into singles, which are required on press,” says Keefe. “It renames files to what the printers require names to be so they can easily place it into their imposition software. It takes advantage of the fact we use auto numbering and InDesign to rename these files, and eliminates the potential on our end or our printer’s end to have errors.”
Meanwhile, Rodale’s Women’s Health works with QuadGraphics and a process called Smart Create. “We print to a print server or export a PDF with a low res image,” says production manager David Cardillo. “It eliminates all pre-press people. Some have argued that it puts the onus of pre-press on us, but I’m making sure my file is okay before shipping. I’ve had issues with people trying to fix things they thought were wrong in the layout. This has eliminated that. It’s also much faster; we usually get a page proof the next day.”

What Publishers Want To See
Publishers have a long wish list for printers and that includes process as well as hardware.
“We feel that printers need to be more pro-active in the exchange of data,” says Hammerbeck. “For example, all of our print instructions are re-keyed at the printer. Publishers should be able to send the printer digital instructions that flow directly into their systems. These systems could also help make it easier for the publisher to produce their folio, place ads, etcetera. There are a few systems that a publisher can buy that will allow them to do this to a certain extent but a publisher shouldn’t have to buy software to make the printer’s job easier and help them reduce errors.”
Hammerbeck also wants to see a change with invoices, which could mean more revenue for the printer. “It would be nice if printer invoices could be coded so that the costs could flow into the publisher’s financial systems and reduce the amount of manual intervention,” he adds. “We have been working very hard to give our magazine printer more non-magazine business but it has been a struggle because they have not been as competitive as commercial printers.”
Garth agrees. “I think the printers and service vendors are doing a great job of creating efficiencies to help smooth workflows but I’d like to see the same improvements made in the areas of keeping track of paper, pricing and insertion orders.”
Outside’s Rhine would like to see industry organizations address guidelines for advertising submission. “I know that individual printers and vendors offer ad uploading software solutions, which represent another cost to publishers,” she says. “I’d like to see AAAA and GATF form a task force of some kind to create universal specifications for ad submission, including insertion orders and billing information.”
Easy, economical and foolproof verification of advertiser supplied proofs is Wennberg’s wish. “We have several ways we review the proofs supplied, but we inevitably receive proofs that the printer cannot match. This results in wasted time on press and potential quality complaints.”
Dwell wants to know how quickly and easily it can verify a proof that is (or is not) SWOP compliant with 100 percent accuracy.
“For us, this solution should be practical for use in an office environment,” says Wennberg. “It should provide us detailed information that we can discuss with the client.”

Be Careful What You Wish For
Still, publishers need to be aware that each new change can bring a set of unintended consequences.
“I recently saw an article about paper manufacturers adding more calcium to the mixture for whiter sheets, and now that’s affecting the press by putting more sediment in the ink and it’s getting into the plates and rollers,” says Cardillo. “Even the pressman isn’t sure. Once they think they’ve got it, someone else throws something into the mix. Yes, it’s the same brand of paper but it’s got a different composition and it hits the paper differently so they have to readjust everything.”
Don’t dismiss Cardillo as just another legacy print publisher who’s afraid of change. “My big thing about any technology is that it does make some things easier but they all come with their own set of problems,” he says. “I’ve got a decade of experience in IT and I say digital is not the answer. It’s faster but not necessarily better. Ultimately, this is still a 400-year-old technology. Maybe it requires a 400-year-old process to get it right.”

SIDEBAR #1
Five Tips for Reducing Production Costs
Printers weigh in on how magazine publishers can save. By Jason Fell
With postal, paper and distribution costs all on the rise, and no economic rebound in near sight, it’s more important now than ever for magazine publishers to save money where they can. Here, we’ve collected five tips—some tried and true, some less conventional—from printers Publishers Press and Transcontinental for how magazines can save on production costs.

• Update your mail list: The U.S. Postal Service has started taking away discounts for Standard and First-Class mailers whose lists have not been updated. Maintaining a current list also reduces the number of over-prints and wasted copies.

• Switch to a proofless workflow: Virtual press side proofing enables publishers to view and manage intricate color proofs online and increases the probability that the final output will mirror approved content. This is a big cost saver in terms of eliminating the need to ship proofs back and forth.

• Use paper from your printer: Maybe it’s a plug, but Publishers Press recommends that publishers find out if their printer offers a private label paper. If this option isn’t available then perhaps switching to a lower grade weight will be more cost-effective.

• Examine all co-mailing options: More printers are offering co-mailing, co-palletization and drop shipping services. Transcontinental and Publishers Press recommend asking your printer for an analysis of your list and determine a co-mailing strategy. “Remember that your goal is to get more of your mail onto pallets to qualify for additional drop shipping and postal worksharing discounts,” Transcontinental says.

• Consider producing a specialty cover: Although the production process might cost more up front, the possibility for generating additional advertising revenue, especially for consumer magazines, are greater. The printers suggest options like stamping, embossing and reflective.

SIDEBAR #2
The Printer As Match-Maker
Printers negotiate deals between publishers and digital vendors.

In recent years, many printers have offered ancillary digital services such as digital editions and ad portals. While some still do, others have decided they are better suited to serving as a representive for their print clients in researching and negotiating with dedicated digital vendors.
Cummings acts as a digital go-between for its print clients. So does Lane Press, which serves more than 400 smaller titles. “Most of our competitors are launching their own proprietary solutions for things like ad portals and digital editions that are typically tacked onto the production process,” says vice president of sales and marketing Charlie Shelley. “We are not software or technology vendors. Technology changes so quickly and the rule is the costs of technology halve every year while functionality doubles.”
Instead, Lane identifies vendors that are best suited for its clients. “We conduct research on the vendors in this space on behalf of our customers, then we negotiate a price and step out of the way,” says Shelley. “We may have three or four vendors in-pocket for a digital solution and each is designed to address different levels of complexity. There may be a very inexpensive provider that a publisher can use for a rudimentary application or a high-end solution that can help increase their rate base.”
This strategy helps reduce the cost of sale for the vendor while giving Lane ammo to compete with other printers who are offering those solutions in-house. “One of our customers came up for renewal and our competitors were offering a digital solution,” says Shelley. “We hooked them up with Zmags and they’ve been very happy.”
Lane has negotiated similar agreements with co-mailing and ad portal services and claims that being the match-maker gives the company flexibility that competitors with proprietary solutions don’t have.
“If you go with an in-house co-mail solution you have to live with their limitations, like not co-mailing a magazine with less than a certain number of issues,” says Shelley. “Because we offer multiple solutions, we’re not hamstrung by a particular logistics provider.”

Publishing Technology

Virtual Events Come Into Their Own
There’s no doubt that virtual events have their fair share of naysayers. Access Intelligence CEO Don Pazour once compared them to virtual sex.
But as the market begins to stabilize in what is now the new norm, no one is laughing as virtual events become go-to resources for publishers in every market. Vendors have ramped up social media offerings to meet clients’ needs—InXpo, for example, was the first to fully integrate Twitter—while magazine publishers tweak show offerings to attract hyper-targeted attendee leads.
“A big area of improvement that I’ve seen on virtual platforms is the virtual lounge area,” says Eric Biener, vice president of business development for Nielsen Business Media. “It allows the audience to communicate. I don’t consider these types of events ‘virtual tradeshows,’ but actually white label b-to-b social networks.”
No longer are virtual trade shows a place to log on and zone out; they are valuable lead generation tools and virtual playgrounds for attendees to interact.

Better Leads Through Exclusivity
Forbes.com hosted its second annual “iconference” in June on the InXpo platform, which included 16 sessions over two days. The major change from 2008 is the targeted attendance of financial advisors—a “higher-level and more difficult conference to accomplish”—says Forbes Media vice president and investments editor, Matt Schifrin. The goal of the iconference was to draw a high-level audience (retail investors are the typical attendees), without charging a fee. For these highly-targeted advisor leads, Forbes was able to price sponsorship packages between $7,500 to $37,500.
Forbes sent invites to select financial advisors. They then received a coupon code to attend the virtual event for free while Forbes charged $75 for attendees who joined without a code. The incentive for busy advisors? Ten continuing education credits awarded through the Certified Financial Planners Board of Standards.
In May, Nielsen’s Photo District News launched its first virtual tradeshow, powered by ON24, free for professional and advanced amateur photographers. The tradeshow consisted of two events held two weeks apart. The first day was designed for photography professionals; the second for a targeted “pro-sumers,” serious consumers interested in new technologies. This second event featured “a major e-commerce component in which attendees were be able to buy equipment directly within the virtual exhibit booths,” says Biener.
While Biener tends to “shy away from [virtual event] bells and whistles,” PDN’s first foray into the photo marketplace had “enhancements and incorporated high-definition graphics and robust video” to appeal to more visual attendees as opposed to its typical b-to-b sector, content-focused attendees. The virtual event, launched strategically around Father’s Day (when the bulk of large photography purchases are made) attracted more than 18,500 registrants, with a follow-up series planned for later in 2009.

Metrics That Woo Advertisers
Watt Publishing, a b-to-b publisher specializing in the agri-business market, ran its first virtual event in April with the InXpo platform. Besides using its Twitter integration, Jeff Miller, Watt’s director of e-strategy sales and marketing, says the company focused on learning how to use the metrics InXpo offers. “What we felt was helpful was not only looking at who was visiting the booths but the ability to create profiles based on the visitor’s actions in the environment itself,” says Miller. “At its core, this is a lead generation device.”
While virtual events are developing stronger marketing plans and incentives for sponsors and exhibitors, Summit Business Media’s Futures, targeting futures, options and derivative traders, is considering upping the cost of entry for its i-Trade shows. Exhibitor booths are priced around $4,500.
“We try and base this price on the cost per lead, which is tough to determine because we don’t have an exact number,” says Futures publisher and editorial director Ginger Szala. Currently, its virtual event silver sponsorships run $10,000 per show, with a $12,500 gold sponsorship offering sponsors the option of a separate speaking time that won’t conflict with the tradeshow’s pre-scheduled speakers.

‘Conferences Will Never Be Replaced’
A number of publishers have opted to forgo their live events this year due to cost restrictions and as a response to across-the-board cuts in travel budgets. However, Haymarket Media, which uses Unisfair’s platform, has decided to integrate both virtual and physical events for its SC Congress (a spin off of IT security title SC Magazine). Exhibitors at physical events will be able to buy a booth inside a year-round virtual environment for an additional fee, according to director of business development Tony Keefe. “We are trying to underpin our physical events by offering a guarantee to give sponsors and exhibitors more confidence,” he adds.
Exhibitors are guaranteed at least one virtual event per month; on the low end, those who only buy a booth in the virtual environment are guaranteed 100 leads, according to Keefe. E-conference sponsors, which have their distinct speaking sessions in which they can address the audience, are guaranteed 500 leads, with no extra charge for more leads than that.
Nielsen Business Media has grown revenue and online event execution by 50 percent every year over the past three years, says Biener. “Of all of the features marketers are looking for, there is nothing else that answers the questions in legacy media better than virtual events.” However, “We aren’t producing these in place of actual events, but as complementary resources. Physical conferences will never be replaced.”

SIDEBAR #1

Virtual Vendors: What’s on the Horizon
As virtual events continue to boom, vendors are trying to keep up with technology extras while still offering affordable packages. Here, some of the latest platform innovations and what’s to come this year from some of the biggest vendors.

InXpo
Publishing Clients: Forbes Media, TechTarget, Ziff Davis Enterprises, Summit Business Media
Price Range: $25,000-$35,000, but this price tag can range up into the six figures for more extensive branding, environment customizations, booths and Webcasts.
What’s New: InXpo was the first to fully integrate with Twitter, allowing for full information integration into back-end reporting. The platform is enterprise-ready, so it can easily plug-and-play into any third-party technology.

Unisfair
Publishing Clients: Penton Media, Haymarket Media, The Economist
Price Range: $30,000-$50,000 per event.
What’s New: Unisfair has separated the user interface from the event management functionality, allowing customers to control the entire look and feel of the virtual experience. It also offers lead ranking and qualification analytics, which allow customers to rank leads based on a comprehensive data model populated during the event.

ON24
Publishing Clients: Penton Media, United Business Media, Nielsen Business Media, McGraw-Hill, Crain Communications, Reed Business Information
Price Range: Hosting will cost $20,000-$50,000 on average.
What’s New: ON24 offers enhanced interactivity and increased engagement with advanced 3-D technologies. They also have new applications which include e-commerce capabilities, mobile and virtual learning centers.

SIDEBAR #2

Archive Etiquette
As a value-add for sponsors and exhibitors, it’s become common practice to keep sponsor logos and exhibit booths alive on publisher sites. How long an event is archived and how a publisher markets the event after it is archived depends on the publisher and advertiser expectations. Here, three publishers weigh in the etiquette behind maintaining and promoting archived events.

“InXpo suggested that we keep our conferences on demand for two months after the live event. We not only do this, but we also have an e-mail account set up specifically for attendee questions. Even though our iconference is on demand, we continue to advertise the event. Also, we take content from the iconference and excerpt it, so, for example, I can spin off short videos for Forbes.com.”
-Matt Schifrin, Forbes Media

“All of our digital events are archived for three to six months. We have a full production staff (two producers, two editors, three sales) and don’t treat our virtual events like a subsidiary. Our archive is exactly the same as it is live; the exhibitor booths are up but instead of being instant messaging-based, they are e-mail based. Our exhibitors can refresh their content themselves, or with our coaching and help. Our team does a majority of the heavy lifting on refreshing this content since exhibitors are not only paying for the delivery, but for our customer service team.”
-Eric Biener, Nielsen Business Media

“We send a weekly e-mail that informs attendees about updates to exhibitor information. We suggest exhibitors and sponsors put new information in their booths (and keep logos intact) throughout the three-month period that the event is on demand. This way, we can market it for them.
-Ginger Szala, Summit Business Media

Reality Check

Battle Over Online Privacy Heats Up
The Venable Consortium, a group of media industry associations lead by AAAA, IAB, ANA, DMA and backed by counsel providers Venable LLP, recently took a significant, proactive step in the release of its “Self-Regulatory Principles for Online Behavioral Advertising.” The publication is important because it’s a direct response to a growing call for stricter control over the tracking of consumer behavior online.
Up to now, publisher and advertiser trade groups were primarily concerned with keeping the FTC on the side of self-regulation, which it largely has been. Lately, however, lawmakers have become more vocal about introducing legislation that threatens the industry’s self-regulatory status.
Congressman Rick Boucher, a Virginia Democrat and chairman of the Communications, Technology and the Internet subcommittee, has made clear his intention to introduce legislation to bolster consumer privacy protection. “I have previously announced my desire to work with Chairman Waxman, Chairman Rush and Ranking Members Barton, Stearns and Radanovich to develop legislation this year extending to Internet users the assurance that their online experience is more secure,” he said in his opening statement during a joint hearing on behavioral advertising with the Communications and Consumer Protection Subcommittees last June.

A Shift Away From Self-Regulation?
Currently, the Internet publishing and advertising industry is operating in a self-regulated environment, but online behavioral tracking is being used to ever-growing degrees—from large ad networks of unaffiliated sites to specific vertical networks and down to single-publisher Web site networks and “related content” applications.
“Part of what we’re doing with that cookie is enhancing the consumer experience,” says Pam Horan, president of the Online Publishers Association, which, along with the MPA and ABM is part of the Venable Consortium. “It’s to make sure we’re delivering the right content. The advertising piece of it is very important, but so is educating the lawmakers on the fact that the technology is also used for a better user experience.”
Congressman Boucher would like to see an opt-out practice introduced where consumers can opt out of first- and third-party use of their information—and then be able to opt in to third-party use.
“If you had a first-party opt out, that would be a publisher-consumer relationship,” says Horan. “In that scenario, that Web site would need to provide the consumer with an option.”
Introducing that option, goes the argument, could severely undermine an advertising business model that, says Horan, supports 90 percent of online revenues. “At the most extreme, a requirement for opt in could have a huge impact on the business model. Our ability to serve ads is the foundation of our ability to serve that model. It could have a significant impact.”
Currently, consumers can opt out via Web sites such as NetworkAdvertising.org. The FTC, for starters, would like to see something more comprehensive. The “Self-Regulatory Principles” guidelines will attempt to take that further by educating consumers via more industry-developed Web sites and marketing campaigns, as well as “new links and disclosures on the Web page or advertisement where online behavioral advertising occurs.”
The guidelines are the first step in bringing the advertising and content industries together on a defined set of principles. Next, says Horan, is a set of guidelines for the enforcement of those principles. All of this, she says, is aimed at proving to the FTC and the Hill that the industry is serious about protecting its self-regulation.

SIDEBAR
What You Need to Know
Ruth Day, chief privacy officer at UBM [pictured], notes the privacy principles published by the Venable group focus on unaffiliated, third-party ad networks. Publishers are considered first-party trackers, and the FTC is clear on that distinction and has essentially backed off any further privacy regulation of first-party tracking of consumers due to the clear, direct relationship. However, many publishers do display third-party online behavioral ads on their sites. For those of you, here’s what Day recommends you keep an eye on.
Read the Guidelines—If you work with a third-party ad server, familiarize yourself with the principles to see what they mean for ads that are displayed on your site.
Know Who You’re Dealing With—“Publishers need to know whether a third-party ad server displaying ads on its Web sites is part of a behavioral online network, with an appropriate representation in the contract or insertion order,” says Day.
Who’s Responsible for What?—“Logically, the third-party ad server needs to be the party responsible for notice because it is the entity collecting information from the visitor to the publisher’s Web site,” adds Day.

Circ Xtra

Preparing Your E-Lists for the Rental Market
Publishers’ growing urgency to get their marketing messages in front of audiences in a more economical and immediate way has caused e-mail lists to become hot commodities on the rental market. But not every list is created equal. In order for publishers to generate a substantial revenue stream, the lists in question must be well maintained and competitively priced.
Canon Communications has approximately 14 magazines and tradeshows, as well as 100 e-newsletters. In addition to its individual lists, the company also has an internal masterfile with about 730,000 e-mail addresses collected over the past six years. According to audience development director Leonard Roberto, the key to a good e-list for Canon is the open rates for its e-newsletters. “We don’t send all of our products to every address we have,” he says. “We mine the database for just those people who have opened and clicked through that particular product. So instead of sending a product to 20,000, we end up only e-mailing those 10,000 that have opened and clicked. We get a far better result that way.”

Rates on the Rise
Roberto says open rates have neared 35 percent and clickthrough rates have been in the high single digits percentwise. Canon has also seen success with getting its customers to opt-in to receive e-mails. “It’s really all about treating the e-newsletters just like the print publications,” he says. “When we’re on the phone with a customer for a print renewal, we’ll just add a quick line for our telemarketers to say: ‘We have a new newsletter that you might be interested in, would you like to receive it?’ It’s a great time to do this because you have a captive audience.”
Roberto says it’s important to have an established bounce rule—a set number of times that an e-mail is sent to an address that bounces it back before that address is removed from the list. But having a bounce rule that’s too low may cause a problem. “For our daily e-newsletter lists, we recently increased our bounce rule to 10,” he says. “We took into account the fact that the recipients might be away or might be having a problem with their accounts. Raising it prevents us from taking those addresses off in error.”
Canon has also seen success with aggregating its products into a masterfile with appended demographics such as company size, number of employees and recency. “I would shy away from lists that weren’t updated in the past year,” he says. “I would also want the ability to select by job title and function. If these options weren’t available, I would move on.”

SIDEBAR
The High Cost of Renting E-mail Lists
by Jane Zarem

While most companies are prepared to pay a pretty penny to rent e-mail names, others find that fact quite surprising. According to Jen O’Brien, senior account executive at Statlistics, some clients expect e-mail rental lists to cost less, because the cost of deployment—typically $100-$120 per thousand—is so much cheaper than for postal mail. “They’re often surprised to learn that, in some cases, the price can be double that of a postal list,” she says, “although all prices are negotiable at this point due to the economy.” She also suggests negotiating multi-channel pricing to interest clients in at least trying e-mail.
In the past few months, however, the differential for renting a b-to-b e-mail list has dropped to a mere 10-15 percent premium over the cost of renting a comparable direct mail list, according to Jay Schwedelson, corporate VP at Worldata. “On the consumer side, the cost of an e-mail list can be even less than a comparable direct mail list,” he says. “I expect prices to come down even more in the next 12 months.”
E-mail rental lists are more expensive than postal lists primarily because they have fewer names, they’re harder to keep up to date, and the universe shrinks very quickly. A list with 10,000 postal names, for example, might include as few as 3,000 e-mail addresses, which are further whittled down by bounces and undeliverables. Otherwise, list brokers handle e-mail lists much like postal lists, in that the list owner must approve the order, gets to see a sample of the creative, and reserves the right to deny renting the names for the renter’s particular purpose. And like postal lists, the best, highest quality, top-performing e-mail lists have good hygiene, the selects are controlled and targeted, and use is limited so people don’t receive too many offers too frequently.
Be prepared, however, for low response rates. “If we’re testing a rented e-list, we usually take the minimum 5,000 names,” according Kelsey Voss, senior director, audience marketing, Ziff Davis Enterprise, who says that her response rates average only around 2 percent when using rented names. “And with a rented e-list, you must really target properly and be very careful with your selects. You need to make sure you don’t buy, say, 50,000 names and then get a 1 percent conversion rate. That would be the same as using direct mail.”

Sales

Sharing the Subscriber List (and Other Publisher No-No’s)
Advertisers have publishers over a barrel and many are starting to make requests that could have long-term competitive consequences, such as sharing the subscriber list. Likewise, event sponsors are becoming even more aggressive, often because they may not be as familiar with long-standing agreements of what is and isn’t kosher—but also because there’s a trend of hammering publishers even harder for events, especially as attendance is often down.
This article looks at how publishers are navigating some of the trickier requests they’re getting from their clients and marketing partners.
“Each case is unique,” says Ted Bahr, founder of BZ Media. “You whine. You wriggle. You try to throw something else in. You try to reframe the argument from the larger perspective emphasizing how important your audience is to their particular goals.”
Occasionally, an appeal to reason works. “Sometimes you can get away with, ‘It wouldn’t be fair for me to give this to you when everyone else at your spending level only gets x,’ but usually they don’t care about that,” says Bahr. “That’s not THEIR problem.”

Sharing Lists: Yes or No?
But should you share your list? Pressure to do so (particularly from event sponsors who want full subscriber lists) is mounting, even though it’s long been understood to be “hands-off” by both publisher and client.
“I’m a former list manger and you can’t give in on the list,” says Watt publisher Steve Akins. “Why not offer to do an e-blast to subscribers with a survey, including questions the sponsors what to ask? That way they can get the responses they want and start to build their own database with folks who choose to give their contact information (prompted) during the survey. You could package this as part of the overall sponsorship cost.”
Others are offering up their lists. “We share our list all the time with large advertisers and it has not hurt us one bit,” says Paul Black, sales and marketing manager at Ball Publishing. “We have a disclaimer on our own sub forms stating that by signing the form they consent to receive our magazine as well as information from our partners. There is also an opt-out box.”
Brandie Ahlgren, publisher of startup CityDog Magazine, says she was asked by a local non-profit advertiser if she would share her subscriber list in exchange for sponsorship at the non-profit’s event. “I consider this a win-win and not too intrusive on a subscriber,” says Ahlgren. “But, it did get me thinking about the value of contact information and how to best use it without alienating our subscriber base. I’ve been considering asking the reader permission first, then sharing their information as direct leads to advertisers. We haven’t done it yet, but their contact information would be kept in a database and sold to advertisers/sponsors as direct leads.”
Black agrees that specific conditions must be met. “If you give them your list, I would urge you to stipulate the exact purpose they will be allowed to use if for, and how many times they may use it and through what date,” he says. “Then seed the list with several names that you can track to ensure they do not try to reuse the list later or worse—resell it.”
When dealing with an event partner, there are two basic points to consider, according to sales consultant Josh Gordon. “One, after the money changes hands. Then what? Will you have damaged your long-term ability to generate revenue from this account or others?”
Secondly, is there a way to move from simple mailing list transaction to partnership? “When a conference writes a check for use of a publication’s circulation, they get the heart of the publishing brand while the conference barely breaks a sweat to help the publication,” Gordon says. “There are far more extensive things a conference can do for a publication that are worth far more than the profit of a simple list rental. But conferences like this arrangement because the cash they spend is not a lot and it is very easy for them. More difficult would be to partner with the publication in ways that benefit the publication, like making the publication an exclusive sponsor, promoting the publication’s editor for speaking slots and signage, aiding publication-sponsored focus groups, and having the conference give the publication access their mailing list to promote circulation.”