MEDIA STATEMENT: Media 24 publications are confident of a recovery following the release of the industry’s circulation figures for the second quarter of 2011. Although some of the numbers are down on a year-on-year and quarter-on-quarter basis, Abraham van Zyl, CEO of Media 24 Newspapers, expects several factors to assist in the growth of sales in the months ahead.
Reacting to Audit Bureau of Circulations of SA (ABC) statistics for the quarter, released today, Van Zyl notes declines in circulation numbers for most of South Africa’s major publications, with some key publications holding steady.
“Obviously we are disappointed that some of our circulations have not recovered as quickly as we had hoped. However, we are quite confident that we will see a pick-up in numbers as we move into the next quarter.”
Van Zyl observes that in certain cases, such as City Press, the recent rebranding has caused a shift in the profile/type of the reader. The new look and refreshed content, spearheaded by editor Ferial Haffajee, have shifted the targeted market from mostly low income earners to a balanced breakdown of low and higher income earners. The 5.8% quarter-on-quarter increase reflects this change.
“We have invested in the strategic repositioning of City Press in order to grow the publication in the medium- to long-term. The paper is in a process of re-establishing itself and redefining its target market. Through this process we are able to reflect the latest newspaper trends, along with heightened opportunities for advertisers.”
Van Zyl says that although the ABC figures reflect a decline for most of the market, Media 24 is proud to have absorbed the impact while restricting its rate increases to the bare minimum.
“Thus, in 2009 we implemented a below-average 11% across the board increase; in 2010 it was a marginal 8%, while 2011 sees a markedly lower 6%.”
The mass-circulation Daily Sun reflected a 2,8% quarter-on-quarter decline. Deon du Plessis, The Daily Sun’s publisher, points out that while circulation has fallen from peak levels, it remains by far the country’s largest-selling daily, offering advertisers unmatched access to a loyal mass market.
“Ironically, the newspaper’s feedback from readers in the form of letters and competitions has been as buoyant as ever before, suggesting an active readership that belies the lower circulation numbers.
“Be that as it may, our 380 000-plus sales are reflective of the newspapers ongoing success. And our cost-per-thousand to advertisers, at only R88, is extremely cost effective.”
Van Zyl says that 12 months ago Media24 implemented its state-of-the-art enterprise resource planning (ERP) system designed to streamline the functions of the group’s print media titles. “We have encountered several teething problems, some of which have only recently been solved.”
“Because the glitches have been responsible for an inability to match certain deliveries to certain subscriptions, our auditors have declined to certify as circulation the relevant un-reconciled numbers. Even though those newspapers have been delivered, our ABC circulation statistics understate our actual sales.
“Obviously, once the payments have been reconciled to sales, the ‘lost’ circulation numbers will be brought back into our books and reflected in our ABC statistics for the third quarter of 2011.
“All our Afrikaans titles have also been affected.”
Deloitte, Media 24’s circulation auditors, underline their unwillingness to credit the group with un-reconciled sales while confirming that such sales will be credited to circulation as soon as they have been reconciled to the payments in question.
Van Zyl sketches a positive outlook for Media 24’s titles, thanks to factors that include:
- Underlying demand for Media 24’s titles remain buoyant;
- Continued investment into the group’s newspaper infrastructure manifestly illustrates its confidence in the future of print media;
- Normality (given the abnormal ERP impact) will be restored by (latest) early 2012;
- Media 24 titles offer advertisers the only print route to the lucrative Afrikaans market;
- Core Media 24 circulation (a strong Media 24 focus area) as a percentage of total circulation is the highest of all SA’s media groups;
- The ongoing restructuring taking place between English and Afrikaans titles is having the desired effect;
- Media 24 is confident that the readership statistics, scheduled for release a month or so from now, will demonstrate ongoing loyalty to the group’s newspapers;
- Operational factors, which have been successfully tackled, have been in large part responsible for Q2 11 circulation declines and/or muted circulation improvements; and
- Conservative 2012 forecasts reflect enhanced circulations in all group publications.
“Underlying all the forces at work is clear evidence that our newspapers are delivering the kind of products that the public wants and values.”
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