Mr. Magazine

Earlier today Eva Dillon, President of Reader’s Digest Community and I had a good phone conversation in response to my earlier blog on the need to reinvent our magazine publishing business model. Ms. Dillon shared with me some of the ways Reader’s Digest is evolving and is addressing the future needs to one of the world’s largest print companies. Ms. Dillon, who is as passionate about the future of our industry as I am, if not more since she has more at stake than I do, wrote me the following letter explaining Reader’s Digest transformation and the plans for the future. What follows is Ms. Dillon’s letter in its entirety:

Dear Samir:

You make an accurate observation in “Must Have” vs. “Nice to Have” magazines: the print industry must transform to respond to the changing media landscape as consumers increasingly want and get their information from multiple sources.

I must point out, however, that you challenge us to come up with a transition plan, one which we (Reader’s Digest) have made public (see Mediaweek, Folio, Delaney Report, Minonline, Mediapost, Crains, DM News), yet then point to elements of that transformation — such as going from 12 to 10 issues a year in order to transition content to digital options — as ills that will result in our demise. With all due respect (and I do mean that), you are talking out of both sides of your mouth.

As the largest circulation magazine in the world with 50 editions in 22 languages generating hundreds of millions of dollars in revenues and healthy margins, I challenge your declaration that “none of the three magazines make much money from their subscribers.” We do. Lots of it. Eighty percent of Reader’s Digest’s revenues come from subscriptions, not advertising. That said, Reader’s Digest has significantly out-performed the advertising marketplace which ended the year collectively down 21% in ads vs. RD’s 7% decline. Seven percent down is the new up in this economy. And to your assertion that we “did not have too many ads in previous months,” Reader’s Digest had more ads in 2009 than 70% of the magazines measured by MIN. You also single out the three magazines as charging a dollar per issue for subscriptions. This is a standard intro offer across the vast majority of magazine publishers, and certainly not the model for the larger part of our (RD’s) sub file, so your point on this front is not well made. Certainly, the fact that consumers do not pay for broadcast or internet (or this very newsletter) does not mean they don’t value the content. Today’s bigger question is how all media will find new models that are not over-reliant on advertising revenues as their sole source, a process we have begun with our own transformation plan.

And finally, to respond to your overall premise about “Must Have” vs. “Nice to Have” magazines: Reader’s Digest continues to have 5.5 million subscribers, one of the top 3 paid magazines in the country. Last year the magazine won the American Society of Magazine Editor’s prestigious General Excellence award. Our subscriber satisfaction and renewal rates are up, as readers focus on the back-to-basics values that have always been key to our appeal. Most important, our brand has long been much more than a magazine, with books, video and music collections that do well for us all over the world, now supplemented with a global website platform being rolled out in 40 countries. With our unique global reach and a culture of sharing content across borders, we have every expectation that we will continue to be a lucrative and relevant brand, and will make a successful transition to deliver content how, when and where our customers want it.

Eva Dillon
President, Reader’s Digest Community

Yesterday, and right after I wrote my blog about “Must Have” magazines rather than “Nice to Have” magazines I received an e mail inviting me to accept a great limited time offer to subscribe to a few magazines for a mere $5 each. I ordered 18, yes 18 magazine-subscriptions at a hefty cost of $90. Don’t rub your eyes, you read and saw that right. 18 magazines for less than a crisp C note (that is a $100 bill for the novice). What is wrong with that picture? A lot. Call me naive, but are we really still dreaming that the ad revenue is going to come back en force and we will go back to counting customers rather than finding customers who count?

How can you create a “Must Have” magazine when you are only charging $5 for an entire year? It is almost the price of one issue of some of the magazines offered in this “holiday special.” In an amazing, yet no longer surprising, this subscription solicitation comes from two major competing magazine companies: the Hearst Corp. and HFM. They joined forces for this “holiday offer.” This amazing deal contained all the magazines published by both companies. The list included such magazines as O, The Oprah magazine, Elle Decor, Woman’s Day, Good Housekeeping… you get the picture. The only magazine that offered half a year instead of a full year for the $5 cost was Elle magazine.
Take a look at the pictures from the offer and judge for yourself: Are we going nuts or there is some rhyme and reason behind the madness. I, for one, think we are still operating in the same state of coma that hit our industry in September of 2008. Every time I see signs of hope from this media company or the other, something big, such as this great offer, kills any signs of hope and tells me that we are still in a deep deep coma. A year for $5 is not a good recipe for success. Feel free to differ!

Three established brands are entering a period of hibernation this coming month (and, unlike bears, they did not have too many ads in the previous months that they had to hibernate, but rather just the opposite). All three brands, Ladies’ Home Journal, Playboy and Reader’s Digest, are skipping their January issues and combining them with the December one to create one double issue. Is it a sign of the times or is yet another proof that the current American business publishing model that depends on advertising as THE major source of revenue for most magazines is no longer working? A quick look at the prices all three brands charge their subscribers should be enough evidence to illustrate that non of the three magazines make much money from their subscribers. None charges more than a dollar, if that, per issue for a one year subscription. Does it really takes a genius or a Ph.D. in economics to figure out that the subscription price is not bringing any “real” money to the bank accounts of the aforementioned magazines?

I do not believe that the issue is a choice of either and or, but rather the problem is all. It is a sign of the times for all three magazines and it is the economic model of publishing. If you take a look at the three aforementioned magazines and ask yourself the simple question of what are those magazines offering their readers that is so unique that they can’t find any other place, what would be your answer? Take a look at the covers of all three magazines and tell me where is the WOW factor? What makes you pick up a magazine, and specifically these magazines, from the nation’s newsstand? Fighting the flu? A dog celebrating Christmas? Or yet another celebrity showing a little bit more of herself?

On today’s crowded newsstands, and in this media age, the room for good enough magazines is slowly, but surely eroding. The creation of a necessary, sufficient and relevant publication is, now more than ever, the only way to survive in this and any economic media climate. We can no longer afford to have a “nice to have” magazines. We are entering the age of the “Must Have” publications, that is if we are interested in survival. All three magazines have been lately experimenting and testing different versions of their covers, different designs and different content and content presentations. The goal is one: stop the bleeding circulation, reinvent the brand and last but not least stay relevant. Will it work? Well, if we keep in mind that brands, like humans, while aging, may have a face lift, a botox shot here and there, and some plastic surgeries that may add a nicer appearance to them, yet as we know for sure, all the plastic surgeries will not prevent humans from dying. So rather than fixing the problem with some cosmetic surgeries, why don’t we look at the real problems and attack them. Ask yourself the simple question, What makes my magazine needed, wanted and desired by my readers? If you can answer that, than add the six-million dollar question to your answer, “How much are readers willing to pay for the magazine?” If your answer does not cover the cost of the creation of the magazine and the cost of delivery, then you are better off pulling the plug on your magazine title and creating another magazine that can provide better answers to the aforementioned questions. We have to accept the fact that magazines are like humans, there is a time to be born and a time to die. Our customers have way too many options for them to choose from, so if you are not creating a unique magazine with unique content for a relevant audience, you can rest assured that you are not doing yourself a favor and that you are trying to avoid the unavoidable.

We are living the media age, and we have to be different and relevant to stay alive. Any other combination is not going to work. So as you hibernate this winter, try to reinvent your business plan as you reinvent your magazine. In marketing, folks always look for a Unique Selling Proposition ( USP). In journalism, we are always looking for Unique Selling Features (USF). What is yours and how much is it worth to the customers (readers) first and the advertisers second. The answer to that question may hold the key for your future success.

I would love to hear your comments on the aforementioned magazines and on the future of our business in general. Do you think our American business model is still viable? Can we continue to create “good enough” magazines? Which magazines do you consider “Must Have” publications. As the media landscape changes, we better be ready and willing to change and create publications that our readers not only want, but rather are willing to pay for to get what they want.

Wishing each and everyone a happy Thanksgiving this holiday season. I have so much to be thankful for. I have been blessed by a loving family, colleagues who understand me and, last but not least, hundreds of friends in the magazine and media world here and around the world. So, to one and all, have a great Thanksgiving and enjoy your turkey. All the best, Samir.

Kids don’t read. That, in short, is myth number one that you hear day in and day out. And if you are willing to believe myth number one, then for sure you will believe myth number two: even if kids read they do not read history magazines. Well, the funny thing about both myths is just that: they are myths. Kids do read and kids have enjoyed reading a history magazine aimed at them called Cobblestone for almost 30 years.

Cobblestone magazine was founded by two New Hampshire women, Hope Pettegrew and Frances Nankin, in January of 1980. They wrote in the introduction to the first issue of the magazine, “Month by month we will be traveling together around our country, visiting the different people, places and events which have played an important part in our history.” The magazine is now part of the Carus Publishing group and this coming January will publish its 30th anniversary issue celebrating 30 Greatest Americans.

I asked Lou Waryncia, Editorial Director of Cobblestone Publishing, five questions regarding the magazine, kids’ reading habits, the future, the impact of technology and the status of children’s magazines in what can be described a “collective Attention Deficit Disorder society.” What follows is the Mr. Magazine™ Interview with Lou Waryncia:

Samir Husni: With the internet taking off faster than a speeding bullet, and digital technology moving printed magazines and books out of the front page news, do you think the end is near for children’s printed magazines?

Lou Waryncia: I do not think the end is near for children’s magazines. I’m a firm believer that print will be around for a long time. Certainly technology is changing the magazine industry, and we’re all trying different ways to co-exist with these changes. But magazines still have a place with children (and adults). We get letters from children all the time saying how much they enjoy their magazines. Getting that magazine in the mail (with their name on it) is still a big deal to most kids. I had a mother tell me recently (and this isn’t the first time) that her son hides himself away in his room and reads his magazine cover to cover the moment it arrives. That one-on-one connection is real.

SH: Do you know whether it makes a difference for kids to read from a laptop, digital device or a printed magazine or book? Any studies you are aware of?

LW: The only study I’m aware of is a 2007 report from the National Endowment for the Arts that indicated a drop in test scores was due to a decrease in the amount of time children read. It brought up the point that kids are reading elsewhere, other than books and magazines, but gave no conclusions on what type of reading is best for kids. Does it make a difference where kids read? I think it depends on the child. I read books, but I was not a big book reader as a kid, but I devoured magazines. I think it’s the same for kids today. There are just more choices today. I think magazines have the capacity to compete with the Internet and other digital devices because of the variety of content and due to great graphics and design.

SH: Cobblestone is celebrating 30 years of publishing and is continuing to focus on history for young kids, do you think that the so called “collective ADD society” can still focus on history and its role in our lives?

LW: The longevity of our magazine proves that kids can and will focus on history if it’s written and presented to them in a way that they find interesting. Cobblestone has grown and changed with the times to make history fun as well as informative. Our goal is to show kids that history has an important place in their lives because it defines who they are and where they came from. Understanding history is a very important part of being a good citizen. Will all kids enjoy Cobblestone, no. But that’s true with any magazine. Yet I think we do a good job of making the subject matter enticing, and I hope entertaining, to a wide audience.

SH: Where do you see the future for all Carus’ magazines? Have you been growing? Steady? Declining?

LW: This has been a tough year for us as a publishing company. But we’ve remained fairly steady in terms of circulation. No dramatic decrease in circulation among our company’s 14 magazines. And we’re non-advertising based. Our subscription rates are higher than other magazines and pay for the publications. One reason I believe we continue to be successful is that parents, grandparents, teachers, and librarians value our magazines and want to get them into the hands of their children. Adults will skimp on themselves, but will still buy items, such as our magazines, that they believe are important for their children. People make a commitment when they buy our magazines.

As to the future, I hope to be around for Cobblestone’s 40th anniversary. And I feel strongly that my company’s magazines will still have a place in the lives of children. Will there be changes, or interactions with technology, definitely. We’re still trying to find our place on the Internet. And will we deliver our content in different ways? Definitely. But I believe we’ll still be flipping through print magazine pages as well.

SH: Will it matter where your great content is consumed? On the screen or on the pages of the magazine?

LW: Ultimately, I don’t think so. Good content is good content. But I think the experience is different. And people respond to media differently. Attention span and the amount of value one places on a medium, or what someone simply likes better has a lot to do with how content is consumed. Studies will eventually tell us if reading on a screen is different, better, worse, or equal to print. I wish I knew the answer. But as in most media battles, everyone seems to find a way to coexist. I believe the magazine will still be an important part of children’s lives for some time.