This week’s question: How much is the decline in magazine publishing affecting new list availability?
Our current panel features Tom Colwell of Conrad Direct, Don Eaker of Wave Direct, Ed Krug of True North List Marketing, Michael Peterman of Veradata, Stefanie Pont of Pont Media Direct, Harold Pratt of Pratt Direct Inc., Kathy Tribel of Lawrence Direct Marketing Inc. and Michele Volpe of Media Source Solutions. Would you like to be considered to be a member of our roundtable? Contact Larry Riggs at larry.riggs@penton.com.)
Thomas Colwell., vice president, Conrad Direct Inc.:
The decline in the availability of magazine lists is having an effect on the whole industry. Free content on the Internet and the economy are two possible reasons. Many different markets rely on magazine subscriber lists to use in acquisition. Nonprofit clients are also feeling the pinch when looking at peripheral markets, and they are looking at new ways to reach these markets.
Younger audiences tend more toward the Internet but there continues to be an aging population that enjoys reading an actual print magazine. The economy comes back into the picture, because individuals are examining their personal budgets and I think subscriptions are thought to be an extra. One hopes that with a stronger economy, people will treat themselves to a subscription. Otherwise we need to be entrepreneurial brokers and find other names to prospect. Either way, our jobs are getting harder.
Don Eaker, national sales director, Wave Direct:
It has been a short-term steady decline, and it has limited our options in some specific vertical markets. However, I think the “death of magazine publishing” drumbeat that we are hearing now will turn out to be a morphing process and not a death. I think we have hit bottom in terms of newsstand/subscription sales and adjustment moving forward will be very multimedia sensitive. New content delivery methods such as Kindle and IPad and similar future developments could lead to a resurgence in publishing, just not exactly like it was in the 20th century. We expect to see new lists in the future come from both Internet as well as emerging social media sources.
Ed Krug, vice president, True North List Marketing:
Whenever you have fewer large-volume quality lists on the rental market, it’s going to have a negative effect. Here are some of my observations of this:
*There are fewer names to mail to since these subscriber files have left the market.
*There is less data to use for data appending to model or append as lifestyle list selections.
*You also have to consider those marketers that advertised in the magazines to generate leads or sales. Their lists have decreased in size, hence fewer names to rent.
Consequently, mailers have started to test online-generated names which do not perform as well as these magazine lists--especially when you can select direct-to-publisher and direct mail-sold subscribers.
I don’t foresee these lists coming back to the market, therefore mailers, along with the support of their brokers, must look at new channels to replace these lists.
Michael Peterman, CEO, VeraData:
For sure, the decline in traditional magazine publishing has had an effect on our business, but new lists have not been that much of an issue. It is the type of new list that is affecting us. As publishers move to digital, mobile and social media there has been a significant increase in the number of highly targeted subscribers, so new lists are always emerging. Companies like Time Inc. and Conde Nast are delving into this with both feet. From IPhone apps with image recognition to speed shop, to interactive travel apps with maps and waypoints, publishers are capturing new segments daily. The ability of brokers to understand how to use, and when to recommend, these lists can be somewhat of a challenge. In a traditional list, the affinity is simpler to assess...with these digital lists, interests can be much more specific and cannot be given the same weight as their paper predecessors. For those of us who can bridge the gap between the old and new, the number of lists at our disposal is growing.
Stefanie Pont, managing partner, Pont Media Direct:
The combination of shrinking rate bases and lack of launches is damaging the industry in a variety of ways. Obviously, a less-rentable universe means less rental revenue for the publishers. This also forces brokers to use names that are lower in the response tiers because, let’s face it: you need the quantity. This in turn delivers lower overall response rates because the names aren’t as good. It’s an ugly Catch 22. The cost to mail becomes more prohibitive every year. The fact that investor money has become scarce has affected the ability to field new launches as well. And you cannot blame all of this on the Internet. The costs associated with mailing are simply a huge drain. For my clients who sell services with annual contracts and monthly service, the subscription model is a similar mindset and tends to respond well. The loss or softness of those sources continues to be of great concern.
Harold Pratt, CEO, Pratt Direct Inc.:
My publishing clients are business-to-business players. They are compensating for the shrunken circulation bases by more aggressively capturing records via trades shows and online marketing channels.
Kathy Tribel, List Broker/Manager, Lawrence Direct Marketing, Inc.:
Any magazine publishing company able to persevere during the last few years will ultimately reap the benefits when things do turn around. Imagine getting a list of subscribers that continued to support a magazine even through a recession. What a great list that would be!
Michele Volpe, vice president of sales and marketing, Media Source Solutions:
Again, you need to think outside of the box. Remember that your competitors are all renting the same files that you are. When you consider that along with declining universes, it’s no wonder that response rates are down. Direct response lists are a good choice with the way they can be segmented.
