A different Consumer Marketing View of Digital VS Print
By Steve Strickman
The digital vs. print controversy for magazines continues to be debated. The conventional wisdom is that, while print versions of magazines will survive, digital publishing will continue to grow and greatly exceed print in audience and advertising.
I have a different view.
I have been partially influenced by the interesting and intelligent debates among industry authorities. I have also worked with several publishers and observed others, which has led to the viewpoint I am presenting here.
I believe that consumer magazine publishers should reconsider if they divert important resources from their core print business to fund digital activities. The digital part of the business will continue to grow, but it should not be at the expense of print.
The internet revolution, followed by the even greater changes brought by the huge consumer penetration of tablets and mobile smart phones, have influenced publishers to focus on digital publishing as their primary source of long term growth. Many publishers, especially the largest companies, have proudly announced varying digital strategies. They have taken great pride in the growth of their digital audiences with press releases, social network broadcasting, industry panels and interviews. Meanwhile, their print counterparts have received little public attention even though there have been a healthy number of new print launches.
There has also been much belt tightening and confusion. Consumer marketing departments have been expected to maintain or increase audiences and the profitability of traditional print businesses with smaller staffs and less discretionary funding. Meanwhile, the single copy side of the business has continued to decline making the challenge even greater.
While this has been happening, most publishers have made the decision to increase their investments in digital products and digital marketing. They have also been trying to participate in the rapid growth of digital advertising.
Replica editions of the print magazines seem to dominate the digital landscape. These editions are generally available via the internet and on different tablets. They have also developed apps for other mobile devices with varying degrees of success. Publishers have also experimented by offering archived content with these various delivery platforms. In general, digital replica editions are added to the rate bases and do not generate significant additional advertising revenues. Audit bureau rules encourage this.
"All Access" subscriptions have become more prominent. In some cases these provide subscribers with access to both the print and digital replica editions. In others it covers print, replica editions, archived content, selective articles, e-newsletters, and interactive database services.
Pricing strategies also vary.
In some cases digital editions are offered as part of the basic print subscription at no additional cost. In other cases there are separate or additional charges for digital editions. In some cases the digital edition price is higher than the print stand alone price.
While digital advertising continues its rapid growth, print advertising revenues continue to languish. This has increased the pressure to reduce costs across the board. Magazine participation in digital advertising growth has been spotty - with some major exceptions. Publishers emphasizing replica editions are not participating in that growth.
The perception that every publisher must be committed to digital publishing means that few publishers can afford not to have a digital presence. Where has the money for these digital investments been coming from? That's the rub! In too many cases, the digital investments have been funded through cost reductions on the traditional print side of the business.
Despite this, and the digital priority, digital audiences still represent only a small part of the audience for most consumer magazines. With some exceptions, digital circulation levels have not yet reached 10% of total circulation. Most magazine profits still come from traditional print products. Yet the consumer marketing efforts have been short changed in many cases. That makes no sense to me. The core part of the business is, in many cases, being neglected! I have concluded that digital magazine publishing investments are not yet paying off, and the future payoff timing is not clear.
The digital revolution is in full swing and it will not abate.
But magazine publishers need to join in an intelligent way that helps rather than hurts their businesses. Here are some of my specific observations and suggestions.
* Magazines are unique and print has some advantages for readers. For example, if one wants to save, say, a retail product advertisement, it is more convenient to tear the page out rather than have to retrieve it from a computer, tablet or other mobile device. There are other portability and graphic advantages. These can be offset by digital advantages, such as those offered by Flipboard, but the choice is up to the individual consumer.
* It is true that younger readers are more likely to prefer digital vs. print. As they get older, however, it is likely they will begin to read more and print will be more attractive.
* Tablet graphics compare favorably with print. Smart phones do not.
* The cost of producing and distributing print magazines is much higher than digital publications, and this must be factored into operating and pricing decisions.
* In doing background research for this article I talked to consumer marketers about successful creative digital promotion campaigns. I could not find many willing to share stories of their success. One possible reason is that the success rate is small.
* The energy and effort required to develop and support digital programs is very high. A frequent result is that traditional core programs are neglected.
* Where there has been too much digital diversion, consumer marketers need to again focus on proven management tools and techniques, e.g., source evaluations, renewal analysis and management, print order control, start assignments, etc.
* Single copy sales levels are not likely to improve, so subscription marketing will continue to be emphasized.
* Consumer marketers seem to be consistent in ranking traditional direct mail and insert and blow-in cards as better sources of subscriptions compared with digital sources.
* Much publicity has been given to the slow growth and problems associated with tablet subscriptions (including getting subscriber data passed through). Publishers need to explore other ways to take digital advantage of their content and the real time interactivity possible in the digital world. Replica editions should be de-emphasized.
* Digital marketing is much more complicated to manage than traditional marketing. Fulfillment suppliers have created tools to help, but some of these have been incomplete and hard to use.
* Larger fulfillment suppliers have failed so far to implement the integrated database capabilities needed to effectively manage co-existing print and digital customer databases.
* Consumers should have the ability to choose among digital and print content delivery alternatives at will. Here again, the fulfillment suppliers need to be flexible and offer the capabilities needed.
* Customer support for digital products is, by definition, more complicated and expensive than for print.
* Consumer magazine print and digital issues are very different than those for books and newspapers as are their business models.
* Similarly, the digital magazine business model may be very different than the print magazine model. Advertising, editorial, production, distribution, and marketing components will have different impacts.
Digital technology is amazing, so I hope no one thinks I am minimizing its current and future impact on all phases of our lives. What I am saying, however, is that magazine publishers have not yet demonstrated that they know how to use the technology to improve their businesses - and in some cases they actually have done some damage to their core print business. At minimum, they need to re-think.
"The Industry that Vents Together Stays Together"