MAGAZINES FACE NEW CHALLENGES
PUBLISHERS ARE COPING WITH THE TRIPLE WHAMMY OF VANISHING DOT-COM AND TOBACCO ADVERTISING AND A SOFTENING ECONOMY.
Byline: Lisa Lockwood
NEW YORK — The dot-coms are disappearing and the cigarettes are snuffed, but publishers are looking at solid fashion and beauty business to salvage the first half.
Up against strong numbers a year ago, publishers are also faced with a softening economy, an erratic stock market, flagging consumer confidence, high layoffs, shrinking ad budgets, later ad booking, and general belt-tightening at the wholesale level. Still, they remain optimistic that the luxury sector — which so far has held its own — will continue to do so, and they say they’re seeing increases from the European fashion houses.
Publishers continue to aggressively go after the hotly contested beauty business. Several magazines predicted that their beauty business will be flat to slightly up in the first half, but a few are reporting bigger gains. Most anticipate a lot of launch activity in the second half.
Here’s how publishers see the quarter playing out.
Vogue: “Flat to a little bit up,” is how Richard Beckman, vice president and publisher, characterized the second quarter. “April was a little off, May will be up and June will be up.”
Beckman said he lost 50 pages each of dot-com and Phillip Morris business in the first half. But he said he was able to offset those losses with his core fashion business, which is showing strong growth. “Despite the struggling economy, I’m still optimistic about the year. I’m not expecting huge gains” said Beckman.
Elle: Carl Portale, senior vice president and publisher, expects to be down 5 percent for the first half, with May off 68 pages but June business up. Elle, which was off 7.3 percent in ad pages in the first quarter, will only have one supplement in the first half — City Guide — whereas a year ago, it ran City Guide and E-Elle. City Guide, which is polybagged with the April issue, is sponsored exclusively by Gucci. In last year’s first half, Elle carried 27 pages of tobacco advertising and 13 pages of Internet ads, but both categories have virtually vanished. Elle will launch Elle Girl in August and will do a special supplement, Elle Weddings, next February.
Portale called both luxury accessories and the Italian business “very strong,” but said the cosmetics business is flat. Among U.S. fashion houses, he said Tommy Hilfiger, Calvin Klein and Ralph Lauren are up, Donna Karan is flat and the Guess is off a bit.
In Style: Steve DeLuca, associate publisher, said first quarter business rose 12.9 percent and that he expects to finish the first half 5 to 10 percent ahead. New fashion advertisers include Alberta Ferretti, La Perla, Nicole Miler and Lord & Taylor. He said beauty business is up 18 percent.
He said the magazine has increased its Italian business, and is now looking to the French as its next growth area. In Style has increased its newsstand price to $3.95 from $3.50 — making it the most expensive in the fashion category — but that hasn’t hampered sales: For the second half of 2000, newsstand sales were up 7 percent, while subscriptions increased 16 percent.
W: Publisher Alyce Alston said the magazine finished the first quarter up 0.8 percent. “The second quarter looks the same. April will be down, but we’ll make it up in May, and June is up a little bit. She said things look stronger in the second half.
“The European fashion business is very good,” said Alston. She noted retail and jewelry are up, and beauty will be flat though the first half. New advertisers include Revlon, L’Oreal, Virgin Atlantic, Tag Heuer, Cacharel, La Perla and Malo.
Marie Claire: For the first quarter, ad pages were up 9.2 percent, according to publisher Katherine Rizzuto. Rizzuto noted that Marie Claire leaped over Glamour in the first quarter for the first time. According to Media Industry Newsletter, Marie Claire carried 313.6 ad pages, while Glamour logged 296.7 ad pages.
Rizzuto said Marie Claire is doing well with health and beauty aids, automotive, and jewelry and watches. She said she expects to be flat in the second quarter, which would mean a 5 percent gain for the half.
Marie Claire has had a lot of success on the newsstand, with sales rising 12.2 percent in the second half of 2000.
Harper’s Bazaar: The magazine had the biggest March issue in its history, with 306 ad pages, up 16.7 percent, said publisher Cynthia Lewis, adding that Bazaar finished the first quarter up 2.9 percent. Lewis pointed out that Harper’s Bazaar hopped over Elle for the first quarter. According to MIN, Bazaar carried 476.5 ad pages to Elle’s 447.1.
“I’m confident I’ll come out of the second quarter flat to slightly up,” she said but acknowledged first-half beauty business will be flat. Newsstand sales were off 7.4 percent in the second half last year, but Lewis quipped, “I seem to be in very good company.”
Allure: April is up 17 percent in ad pages, and the outlook for May is good too, said publisher Suzanne Grimes. Through April, core categories — cosmetics, haircare and fragrances — are ahead by double digits, and fashion is up 4 percent.
“The economy is very uncertain and every smart company is carefully allocating their dollars,” said Grimes. But, “people are following through with their launch plans. Right now the beauty category looks pretty strong.” Grimes expects a 5 percent first half gain. She said second half newsstand sales last year increased 6 percent while total circulation increased 1.2 percent. And this all occurred while Allure took its cover price up 20 percent.
Cosmopolitan: “The first quarter was challenging, but wasn’t abysmal,” said publisher Susan Plagemann. “In a year that’s tough, our goal is to maintain share of market.” Through March, Cosmo is off 7.3 percent, according to MIN, and Plagemann attributed the drop to the disappearance of tobacco advertising. She noted the beauty business was ahead 9 percent. Plagemann said April ad pages are up 11 percent, while May, which is the swimsuit issue, is flat. She said she expects to be flat for the second quarter.
Jane: Eva Dillon, publisher, said the magazine also took a big hit in the dot-com and tobacco categories. She said after a 12.1 percent drop in first-quarter ad pages, the second quarter is looking strong. April is up 29 percent, May is ahead 13 percent and June pages increased 9 percent. She attributed these gains to fashion, beauty, health and pharmaceutical ads. Among its fashion advertisers are Tommy watches, Christian Dior, Lilly of France, Marc Jacobs, American Eagle, Target and Girbaud. Beauty is up 30 percent through the first half, with advertisers such as Oxygene, Miracle, American Original, Lucky, Shiseido and Herbal Essences. Interestingly, one new advertiser at Jane is the U.S. Army.
Mademoiselle: The magazine was off 28 percent in ad pages in the first quarter but looks for a lift in the second. Lori Burgess, publisher, said she expects to be up about 5 percent, with new advertisers such as The Gap, Lee Jeans, The Sac Elliot Lucca, Oxygene and Ultresse. In addition, Mademoiselle has broken the salon haircare business, with Matrix, Redken and TIGI advertising, and is carrying some new travel business from Contiki Travel and Club Med.
Self: Publisher Beth Brenner said the magazine was off a few pages in the first quarter, which she attributed to losses of Internet and automotive business.
“Detroit has reacted to the [stock] market and has pulled back dramatically. They’re usually our second or third biggest category, but in the first quarter they’re No. 6,” she said.
As for the drop-off in tobacco advertising, Brenner pointed out that Self is carrying the “Can’t Smoke Under 21,” campaign from Phillip Morris. She also said the magazine’s jewelry and food business are both up. “Beauty is definitely a bright spot [for the second quarter]. We’re up in beauty, even more dramatically than the first quarter.”