Covid crisis shows magazine resilience

Enders Analysis indicated a strong decline of advertising among almost all channels during 2020. But these same channels are expected to rebound and attract more advertising money in 2021. Newspaper and magazine brands also show their resilience.

Magazines in the USA have taken different decisions to cope with the reduction of advertising revenues. Some publishers decided not to make any changes to their strategy. Others changed the publication frequency, like numerous titles from Hearst (e.g. Cosmopolitan, Elle, Harper’s Bazaar, Marie Claire), and Condé Nast (Vogue, Vanity Fair). Meredith, the third and largest US publisher, also reduced the frequency of some publications, but this decision was apparently taken prior to the Covid period.

Says Doug Olsen, President of Meredith Magazines: “We certainly looked at frequency changes, but we decided that the consumer strategy that we had was going to override any advertising shortfalls in the near term anyway”.

An interesting point to note is Hearst made the most changes to frequency, but the least in terms of headcount and pay when it came to saving costs amid the pandemic. To date its only mass layoff was 59 staffers at O. In contrast, Condé Nast implemented pay cuts, laid off 100 staffers and furloughed the same amount, while Meredith let go of 180 staffers across the whole business, cut pay and paused the dividend. Both companies have since restored full pay.

Other titles halted their publication, but will probably restart in 2021. The most radical decision, taken by Playboy, was to cease print operations entirely. The economic disruptions from COVID-19 were too much for its already strained print operations to bear.

However we need to see these developments in perspective, for a number of magazines the print editions have by far the highest readership. Just take an innovation/technology magazine such as Wired. One would expect the audience to be more biased towards online reading, however the title has only a limited percentage of online subscribers in the US. It comes as no surprise that readers of fashion magazines prefer the quality of the photography printed on paper. Vanity Fair's subscriptions have increased since 2012, with a higher increase of print subscriptions.

Time spent with magazines also increased, from 44 minutes to 56 minutes in the UK.

On the question of whether 2021 reading behaviour will be similar to the 2020 trend,  Sue Todd (CEO Magnetic) says: “Routines will change again as we come out of the various tiers of lockdown and so will media consumption, but we won’t go back to the same patterns from the start of 2020. Some of these new behaviours will stick. I believe we’ll hold onto new audiences as people continue to flock to find content that aligns with their new or rediscovered passions”.

Many publishers want to reduce their reliance on advertising revenues and increase the revenues generated by readers. Very much like telco operators use ARPU, publishers would be looking at Average Revenue Per Reader (ARPR). That could include, next to subscriptions, sales of exclusive branded products, books and podcasts. A number of publishers are even considering re-using content for films or television series.

The latest Innovation in Media Report (2020-21) mentions 13 strategies for publishers to make their company thrive.

However in this search for new strategies advertisers might be overlooking current successes in magazine advertising. (No surprise as the Radiocentre’s ‘Re-evaluating Media’ study already pointed out a true mismatch between the effectiveness of magazine advertising and the marketers knowledge of its effectiveness). The use of inserts and Direct Response advertising is thriving. Both forms of advertising benefit from the fact that people were locked in their homes and wanted to order online. Print proved to be the ideal starting point for online sales.  

However as Douglas McCabe (Enders Analysis) says: “The big challenge for a number of publishers is that they are having to think about a world in which the amount of revenue that can be generated from being an important media brand . . . is probably just fundamentally worth less than it used to be”.