While the upcoming Rugby World Cup might raise South Africa’s spirits (just for a bit, and also if the Boks perform and transform), this won’t last long and the country will remain “distressed” – an apt metaphor for South Africa’s publishing industry, if the latest Audit Bureau of Circulations of South Africa numbers are anything to go by. Michael Bratt reports.
Gordon Patterson, deputy chair of the Audit Bureau of Circulation of South Africa, and Jennie Beck, from Kantar Media, have interpreted the numbers and given insight into what they think can be done to boost them.
“I don’t think newspapers are dead. I think they do have a future. We will still have them in five, 10, 20 year’s time. They may be different but they will still be there,” said Beck while delivering her presentation.
Beck gave an overview of how she sees the newspaper environment currently operating and what possible scenarios could play out in future. “We are looking at a new age of newspaper reading, but only if we can generate the revenue to support it.” She explained two ways in which newspapers are trying to rebound. “A lot of newspapers are focusing on getting money from existing subscribers, rather than looking at getting new subscribers… significant raising of cover prices is also happening.”
The numbers reveal that second quarter total press circulation declined 1.7% quarter on quarter (q/q). Losses were recorded across the board, except for free newspapers, which remained at stable levels from the first to the second quarter. Weekly newspapers were hardest hit, seeing a 6.6% drop q/q, while local papers were second hardest hit, with a 5.8% drop q/q. Weekend newspapers followed with a 4.6% decrease q/q. They also saw a decline in both single copy sales and subscriptions. Daily newspapers reported a 4.3% fall q/q. The only saving grace for the latter was that while copy sales declined, subscriptions increased slightly.
The daily publications that were hardest hit include Daily Sun (9% drop), Sowetan (5% drop) and Business Day (5% drop) all in q/q single copy sales. The Herald was the only shining light in a dark space, recording a 1.1% rise q/q.
Weekly publications were llanga (12% drop), Soccer Laduma (6.3% drop) and The Post (4.8%) all in q/q single copy sales. Weekend publications that recorded terrible performances include Sunday Sun (9.7% drop) and llanga Langesonto (9% drop) both in q/q single copy sales. Sunday Times saw a 6.5% drop in both single copy sales and subscriptions q/q. The two rays of light in the weekend darkness were Independent on Saturday (2.3% rise) and Isoleswe ngeSonto (0.8%) both in single copy sales q/q.
Local publications had both good and bad performing newspapers with District Mail (12.5% drop) and Rustenburg Herald (11.5% drop) both in single copy sales q/q. South Coast Herald (2.6% rise) and Capricorn Voice (11% rise) both in single copy sales q/q were the major victors. The latter did very well with a 45% increase from the corresponding period last year (y/y). As mentioned before the free publications were the major winners with Msunduzi News (66.7% rise) in single copy sales q/q and Lesiding News, Kasi Vision Zwelethemba and Go & Express all showing considerable increases q/q.
A large portion of Beck’s talk was centred around the impact that digital is having on newspapers. Her takeaway from this element is that, “We need to make changes to some of the ways we create content. We are already seeing ways in which more digital revenue is created. Newspapers need to take charge of distributing their digital inventories.”
The picture does not get rosier when the focus is shifted to magazines. Second quarter total circulation dropped 8.3% q/q. All three categories: consumer (5% drop), business to business (6.7% drop) and custom (11% drop), saw disappointing numbers. The one positive for magazines was that their subscriptions remained predictably more than press ones.
SARIE was one of the standouts, increasing 9.6% q/q mainly in single copy sales. The different categories of consumer magazines: home (3.9% rise), motoring (9.7% drop), sport & hobby (1% rise), travel (14% drop), and women’s general (6% drop) represented a mixed bag of fortunes. The two types of business to business magazines: architecture (4.5% rise), and management (10% drop) also saw mixed results. The different categories of custom magazines: entertainment (13% drop), leisure (6% drop), retail (11.3% drop) all performed poorly in the second quarter.
Patterson said that the most worrying trend in magazines is the churn rate. The statistics revealed that in half a year, 11 new titles arrived while 30 disappeared.
But what are newspapers and magazines doing wrong? Patterson has a very different view from most media professionals who look at the numbers. “The bottom line is that publications are in sharp decline. People assume the decline is a result of people choosing other forms of media to get their news. And I don’t think it is,” he said.
Patterson went on to explain the system, whereby publications reduce their print run to get as close to their circulation as possible, in order to cut costs, thereby lowering their returns. However by doing this, the publications full selling potential is never found out. “They cut their print run to get as close to their circulation as possible. So returns are tiny. Returns are your growth potential and they are cutting them away so declines become self-fulfilling, and that has a cascading effect into readership because if you are not circulating enough then your readership will ultimately come down.”
Patterson explained the solution that he sees as most viable to boost print circulation. “The thing that is missing in the equation is advertising income. If you want to increase your circulation, sell more ads! And it sounds incongruent. I look at the numbers, in the first five months of 2015 and magazines are generally earning 15% less in ad income year on year. In the same period newspapers earned 6.6% less. If you’ve got less income, you cut your print run. If you can’t print your circulation comes down, because you are compressing your returns. So if publishers want to improve their circulation performance they need to sell.”
Patterson believes that sales people are doing it all wrong when it comes to selling their publications, dropping off gifts to advertisers without “defining the publication, putting it into perspective and convincing advertisers to get on board with it”. He said he has not seen a sales person do that sort of pitch in over two years. “The economy has had an impact and digital has had an impact of where you get your news from. But if you are not selling it, then it’s a huge disservice. And I don’t think print is selling.” But he does not blame the sales people themselves. He believes that the sales personnel are not being given the right information in order to go out and sell aggressively.
Patterson also shared his views on the balance between digital and print, “We are seeing now with social media and digital media a major challenge in print, in that printers who populate our landscape in South Africa are uncomfortable with digital, they see it as being the anti-Christ. A big threat. And the reality is that technology liberates, it evolves, and the only thing that dies, in any category you look at, are those entities that can’t evolve, that can’t take advantage of the changing environment.”
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