30 December 2010

A Crossroads for Magazines

If publishers are looking to the iPad to help revive (or extend) magazine sales, recent figures released by the Audit Bureau of Circulations (ABC) aren't good news. While not all magazines that are available on the iPad release their digital single-issue sales to the ABC, those that do all show a significant year-end drop.
WWD reports that Vanity Fair sold 8,700 digital editions of its November issue, down from an average of about 10,500 for the previous three months. Glamour sold 4,300 digital copies in September, but sales fell by 20% in October and then another 20% to 2,775 in November. GQ's November edition sold 11,000 copies, its worst sales figures since the iPad was released.

Magazine companies are at a crossroads, the same one that was faced years ago by newspapers.  Magazines are more fortunate than newspapers, in that they are far more niche and focused.  Newspapers are about what is recent; magazines are about analysis.  As such, it isn’t a huge deal that their stories and features aren’t up-to-the-minute.

However, they are becoming increasingly irrelevant, since most of their content can be found for free online, especially since celebrities are generally tending to connect directly with fans through social media.  What these magazines need to do is eliminate print editions, negotiate product exclusivity (with Apple, Amazon, etc.), and sell ad space to generate revenue.  Eliminating print leads to a significant reduction in price, product exclusivity allows them to get device manufacturers to subsidize their product.  They already sell ads, so they can continue to do so.  Actually, offering interactive ads could lead to higher ad revenue, which would be a bonus.

It’s nearly impossible to compete with free content, so magazines should embrace the change and make it theirs.  Everyone will benefit.

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