There is no doubt that easier broadband access, mobile devices and mobile access is impacting magazine sales. As I have commented here before, the magazine categories of Buying and Selling, Computers and Adult seem to me to be hardest hit. Computer titles are especially suffering. Titles such as PC Authority, APC, PC World, Aust. Net Guide, Macworld – the data I am seeing suggests all are losing sales.
One title, the worst in the category, used to sell 80% of all copies received in the 5 stores I have looked at data for and today it sells 40% – just one year later. Newsagents are carrying higher cost since supply quantities have not been cut. That aside, publishers must be carrying additional cost and must be under pressure from advertisers who are not getting the same readership. This will push advertisers online and place the magazines under more pressure to scale back or close.
In my part of the world and in anticipation of change, we’re focusing more on magazines less likely to be disturbed in the short to medium term by Internet related technologies – and there are plenty of these. Besides the continually strong women’s weeklies and women’s interests categories, we’re also focusing on crosswords, cars, pets, craft, gardening, health and fitness, sport, children’s and hobby titles. We’re contracting music, adult, buying and selling, computers, photography and games – so we can sell more magazines in the growth categories. It’s all about efficient space management.. Of course our desire to contract and the position of the magazine distributors can be challenging to synchronise. Plus there is the risk of our move becoming a self-fulfilling prophecy because of lack of stock. However, I have seen enough sell through and cash flow data to give me confidence that we have picked the trend.
Unfortunately too many newsagents are carrying too much magazine stock and as a result will be cash flow negative unless they realign their category focus to reflect market trends.
So when is enough enough? When should a publisher/distributor/newsagent kill a title? Given the distribution model, the break even point is different for each player involved. From a newsagent perspective, titles achieving a sell through of less than 50%, based on the current supply paradigm, needs to be cut. The alternative is more equitable arrangements (greater commission, a handling fee, a real-estate fee) to make these titles viable.
