NEWSSTAND: After falling for years, unit sales of magazines at retail actually rose in 2004, by three-quarters of a percent, according to an analysis by John Harrington, publisher of the New Single Copy Newsletter. And if you’ve been through a supermarket checkout in the past 12 months, it’s obvious why: the explosion in celebrity weeklies, led by People, Us Weekly, In Touch and Star Magazine. According to Star publisher Michelle Myers, one out of every five retail dollars spent on audited magazines in the second half of last year, or 20 percent, went to one of these four titles, up from 17 percent in 2003.
With new entries hitting the market almost on a monthly basis, the question being asked now is: When will the category reach its high-water mark? “We’ll probably be challenged with that sometime this year,” predicted Us publisher Victoria Lasdon Rose.
And then what? In the view of Steve Sachs, vice president of consumer marketing for the People Group, that depends on “what’s the universe of buyers and how many magazines can survive to sell to that universe. Can it be six or seven? That seems high to me. Can it be more than one? Yeah, probably.”
A number of celebrity titles are part of a related trend toward charging less than $2 at retail. (See above story.) Interestingly, however, the second half of last year also saw an increase in the number of magazines that raised their cover prices. According to Harrington, 124 instituted hikes, versus 98 in the first half of the year.
One other development that could have a huge impact on magazine retailing is the expected arrival in the U.S. of new men’s weeklies such as those currently dominating the market in the U.K. Time Inc., which publishes Nuts in Britain, is exploring the concept here, and Hearst has reportedly hired former Maxim editor Keith Blanchard to create something similar. Could men’s weeklies be the next big wave? “The thing that works against it is the [women’s] weeklies here sell primarily in supermarkets, and the shoppers in supermarkets are primarily women,” said Harrington. “But that’s the conventional wisdom. At some point, it’s wrong.”
SUBSCRIPTION: While British magazines acquire most of their circulation through single-copy sales, the American magazine industry is subscription-driven, and that poses its own set of problems.
Those problems went on display in January when Gruner + Jahr USA Publishing announced that several of its magazines would miss rate base after auditors disqualified portions of its subscription files. G+J blamed the incident on a single subscription-sales agent, Publishers Communications Systems, but a number of consumer marketing executives say it is not the only agent to employ questionable practices.
Now the Audit Bureau of Circulations is scrutinizing circulation statements more closely and so are advertisers, according to Michael Clinton, executive vice president and publishing director at Hearst.
One bit of good news has to do with the Federal Trade Commission’s Do-Not-Call registry, which many consumer marketers feared would put a damper on telemarketing, an increasingly important source of subscription sales. According to circulation analyst Dan Capell: “It has not had the kind of negative impact we thought it would have.”
A number of new magazines are skirting the problem entirely by building their readerships through controlled, rather than paid, circulation. Vitals, Absolute and Trader Monthly are a few of the newer titles touting controlled circulation as a way to reach a more select demographic. But it remains to be seen to what extent advertisers will embrace the idea of magazines for which readers don’t pay.