The Newsstand Data: Harbinger of Things to Come. The Man Who Want to Save the Newsstands. Part two of the Mr. Magazine™ Interview with Luke MagerkoJune 26, 2013
The American magazine business model is not one that depends heavily on single copy sales. It is a subscription based business model. No wonder than that some publishing companies seem disconnected from their newsstand departments despite the fact that sales at newsstand exceed 3 billion dollars and more than 100,000 stores sell magazines in the United States and Canada. Newsstand is a leading indicator of consumer trends but its complicated distribution system and financial terms such as RDA, IPO, rack fees, etc. make it difficult to embrace. In spite of its complexities, however, newsstand should be at the forefront of publishing because of its ability to predict future successes and failures for a publisher.
For example: Editors at a top-ranked, niche magazine radically adjusted editorial focus based upon two factors: a change in advertising strategy designed to expand sales opportunities, and recognition that the existing audience for the niche was contracting. The publisher’s marketing projection predicted a small decline in readership from core subscribers, but believed the gains from the new audience would outstrip the losses. The results, however, were far worse than the projections. The title successfully grew the new desired audience, but the success was mitigated by a rapid decline in existing audience. My team provided the disappointing results to consumer marketing, warning that similar declines might be recognized in renewals, and ultimately in direct mail results. Indeed, newsstand predicted the consumer marketing declines accurately and ultimately the title folded.
In the second part of the Mr. Magazine™ Interview, Luke Magerko continues his explanation on how we can fix and enhance this important venue of magazine distribution. Click here to read part two of the interview.