Gone are the days when it is embarrassing to say you work in magazines, says Jonathan Harris. He explains why in a story first published in The Media magazine.
There was a time when I would go to media, mobile or tech conferences and dread the question “what business are you in?” Such an unprovoked attack would normally elicit a rather uncomfortable silence, followed by attempts at avoiding the question, finally ending up with me mumbling, “Magazines, but we’re going to be fine.”
Today, I am happy to say, life is slightly less straining for me at these types of events. Having recently returned from the Newsweek Bloomberg Media Summit in New York, I can happily report that I experienced no uncomfortable moments, other than witnessing the brief spat between the CEOs of Business Insider and the FT Online, and that the death of magazines has been greatly exaggerated. Cliché intended. There is greater confidence, optimism and – dare I say it – even a little cockiness among my magazine media cohorts than at any time since the real and inevitable threat of online reared its head.
So, what has happened to magazine media businesses over the last few years to bring about this change, and does it tell us anything about the future of the industry? Well, despite overall magazine circulations having declined in territories like the USA, the market now looks like it is stabilising.
The number of paid magazine subscriptions slid 1.2% in the second half of 2010, with overall sales declining by the same percentage. But this is better than many expected. In South Africa, retail copy sales actually grew by over 6% year on year in 2010. Not bad, but of course we are insulated to some extent from the drivers of the US decline. Now, this is not new news to most – but it is underestimated, I believe, how important this snippet of data actually is in helping us predict the future, and what part media companies are playing in mitigating declines.
Magazines compete for share of time, right? Which basically means they compete with everything that vies for the attention span of someone in an increasingly time-compressed world. Why, then, do circulations look like they have begun to stabilise for these unconnected, environmentally destructive, linear, paginated and low-density products – especially given the near cult influence of Facebook, free content flowing from every digital crevice and a plethora of other tempting, time-consuming media baubles? The answer is threefold.
One, the era of information overload is here and magazine brands are becoming increasingly important filters as they synthesise and distill information. Two, the whole experience of discovery and surprise offered by magazines actually still feels nice for the reader. Three, magazines provide content objectivity and authenticity; pillars that will never diminish in importance, especially to advertisers.
The sum impact of these factors has reignited the magazine industry’s belief in the core value of magazines as creators (original copy), curators (filters and aggregators), and collectors (community comments) of content, and this is informing how these brands are now pushing out towards consumers. This thinking has positioned magazines better within a media ecosystem of owned, earned and paid media that is in flux and establishing itself.
So our printed media products look like they might be okay and will provide a solid base for other channels of reader engagement, specifically tablet and app. Then, of course, there is the small issue of advertising revenue and business modelling. Here the news is also not so alarming – if you look a little further down the track to alternative content monetisation strategies, the value of the filter and the investment decisions being made today.
Sure, the advertising revenue line has been under pressure, but the consumer magazine media industry in the USA actually capped a strong 2010 by generating an increase of 3.1% in rate card-reported revenue for the year. The industry accepts that there are still unquantifiable and evolving new risks, such as consumer brands opting for direct path advertising and commerce companies moving into content. But, more importantly, against this backdrop there is finally a robust, well thought-out and surprisingly higher level of riskier experimentation being undertaken around content and new revenue models than at any time in the history of so called traditional media companies.
Print media businesses have learned from the music industry and now understand the shifting value, along the value exchange, between distribution and content. The fact that the music industry is worth more today than it was 10 years ago, but that it’s not the music companies making the money, is not lost on my industry peers.
Their fear of the dominant intermediary is evident: just look at the pushback against Apple so early on in the life of the tablet market. This debate is helping to form business strategies and thinking. The proverbial water cooler at the media summit was awash with talk of affiliate commerce relationships, bets on HTML5, the importance of becoming part of the distribution experience, how data is the new creativity, social is the new search, and search is apparently the new newsstand. Gotta love those quotable quotes! And after years of technology illiteracy, I even heard one well-known media exec say, “Technology is simply the facilitator for content.” At last.
As this more sophisticated understanding of the new media landscape begins to play out and shapes business models and reader engagement, one other very important and palpable change is taking place. We are witnessing the birth of the new media hybrid and, at its core, the changing mindset of editorial teams. The upskilling process is finally yielding and new multiskilled brand teams are energised, leading to increased levels of innovation and speed and complexity of implementation.
For example, the new Hearst-backed app developer LMK, known for its growing stable of topic driven content apps, can now go from idea to an app in under 60 minutes – hard to do if you don’t own the content or know how to create experiences that are meaningful.
Building out from offline and creating rich online experiences that mask complexity and move across devices cheaply requires internal team hybridisation and solid external team collaboration. I have seen plenty of evidence to suggest that this is happening in spades, and my prediction is that we are about to see an explosion of new thinking from magazine businesses said to be on the ropes only a few years ago.
Once this happens, and after spending the last five years defending the future of magazines, I plan to be the one asking the question: “What business are you in?” – this time hoping someone will ask me in return, so that I can reply “magazine media” and simply leave it at that.