In conjunction with the Audit Bureau of Circulations releasing its first half 2009 FAS-FAX report earlier this week, The Economist announced that the magazine more than met its 764,000 rate base in North America, with total circulation during the period reaching 810,821, an 8.5 percent spike year-over-year. Its global circ grew 6 percent to 1,418,013—double what it was a decade ago.
But The Economist’s circ gains are only part of the picture. The Economist Group, the magazine’s parent company which recently expanded its portfolio with the acquisition of Congressional Quarterly, saw its profits jump 26 percent to a record $92 million for the fiscal year ended March 31.
Here, FOLIO: spoke with Alan Press, on what role the magazine’s marketing strategy has played in its success. For three years, Press has served as senior vice president of marketing, overseeing marketing strategy for The Economist, Economist Conferences and the Economist Intelligence Unit, which publishes industry and political analysis.
FOLIO:: The Economist is having a record year, at least in terms of circulation growth and profit. What do you attribute all of this growth to?
Press: The Economist’s success starts with the editorial product. The unique value of The Economist is its truly global perspective and the depth of its analysis, which readers can find nowhere else. Economist readers are intelligent, intellectually curious, and, in a rapidly changing world, they want information that is current across as broad an array of subjects as possible.
Another key reason for our success is that we continue to invest in marketing, even in the downturn. Because we are a premium product—the average price for an annual subscription is more than $100—we have a very different business model than most magazine publishers. Our circulation business is profitable and that allows us to invest in brand building and customer acquisition efforts even when the advertising market is challenging. For example, we began a series of integrated marketing campaigns targeting major metropolitan areas in 2006. We’ll target three more major cities this year- investing in outdoor, radio, online, print and other forms of marketing to build the brand and grow our readership.
FOLIO:: As senior vice president of marketing, how have you used these positive stats to your advantage?
Press: Increasing our readership is critical to our business, not only because it raises our rate base, but because we make more money from every additional copy we sell—be it to a subscriber or newsstand buyer. Investing in direct marketing and brand advertising have been key contributors to our success and through integrated marketing strategies, we have tried to maximize this investment to sell more copies.
FOLIO:: How do you describe The Economist’s marketing strategy?
Press: We start by targeting the ideas people who are thriving in the global knowledge economy. There is a myth that people are looking for sound-bites and celebrity and that this has led to a growing demand for and acceptance of commoditized news output that speaks to the lowest common denominator. The reality is that there is a growing demand among the educated for intelligent news, analysis and entertainment that challenges, amuses and informs.
FOLIO:: How, in your position, do you feel you’ve contributed to the magazine’s success?
Press: We have a renewed focus on data and customer insight to inform new segments and channels. Finding new customers for us is not as simple as targeting a demographic, but rather tapping into a psychographic, as what ties our readers together is their thirst for ideas and knowledge. To find these "ideas people" we have tried to instill a culture that allows for bold and calculated risks, with the understanding that sometimes we won’t get it right, but that overall we will grow by seeking and executing new ideas.
FOLIO:: How is The Economist poised for continued growth into 2010?
Press: We will continue to invest in brand marketing. We will continue to test new subscriber acquisition tactics and efforts to build our retail presence, including through new mobile and online channels. We are getting increasingly better at targeting customer segments and thinking about customer touch points. And, I think we will expand into different media. After our recent launch on Kindle we are among the best selling magazines on the device and the coming year will see the launch of a number of these devices. We are also investing in our events business, launching new products this year and next.
We believe that the affluent and the educated, globally, are increasingly looking for opportunities that fuel their thinking and satisfy their curiosity about the world—whether through print media, online, books, films or cultural events. The Economist fits perfectly into this media landscape and we think there is a lot of room for growth in the near term. The challenging part of the job is keeping up with the pace of change—and making the most of the market opportunity this brand enjoys.