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GLOBAL TRENDS AND CHALLENGES FOR MAGAZINES

GLOBAL TRENDS AND CHALLENGES FOR MAGAZINES. Donald D. Kummerfeld President & CEO International Federation of the Periodical Press (FIPP). Current Magazine Trends (before global recession).

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GLOBAL TRENDS AND CHALLENGES FOR MAGAZINES

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  1. GLOBAL TRENDS AND CHALLENGES FOR MAGAZINES Donald D. Kummerfeld President & CEO International Federation of the Periodical Press (FIPP)

  2. Current Magazine Trends (before global recession) • Magazine companies are generally healthy and profitable in most countries and in most sectors. New titles abound and weeklies are growing trend. • But little overall growth in mature markets. • Yet market prices for well-established successful titles remain high. • Growth in developing markets driven by increasing consumer incomes and by growth in advertising, but global challenges are similar in all countries. • Globalization of successful titles seeking to take advantage of opportunities in foreign markets, both mature and developing.

  3. Growth in the consumer magazine market has been fuelled by strong underlying performance of the BRIC countries Consumer magazine market Outlook The future of magazine publishing

  4. Impact of Recession on Magazines • Sharpe decline in magazine advertising in those countries with heavy ad volumes e.g. US, Germany, UK • (US = -12% 2008, -13% 2009) • Smaller ad losses in developing countries where consumer spending is still growing e.g BRIC countries • Little or no impact on copy sales • Marginal titles disappear, fewer new launches

  5. Impact of Recession on Magazine (continued….) • Slowdown in growth of internet advertising, particularly in display and video. Search related and e-commerce related ad spending remains strong. • Underlying shift towards digital and particularly towards mobile platforms continues. • Increase in media consolidation , including magazines. The longer the recess lasts the greater the restructuring and reorganization.

  6. Global Consumer Magazine Publishing Market by Region (US$ Millions) Source: PricewaterhouseCoopers

  7. Global Consumer Magazine Publishing Market by Component (US$ Millions) Source: PricewaterhouseCoopers

  8. Consumer Magazine Publishing Market by Component (US$ Millions and %) Source: PricewaterhouseCoopers

  9. Consumer Magazine Publishing Market by Country (US$ Millions) Source: PricewaterhouseCoopers At average 2007 exchange rates

  10. Consumer Magazine Publishing Market by Component (US$ Millions and %) Source: PricewaterhouseCoopers

  11. Consumer Magazine Total Advertising Market (US$ Millions) Source: PricewaterhouseCoopers At average 2007 exchange rates

  12. Consumer Magazine Circulation Market (US$ Millions) Source: PricewaterhouseCoopers At average 2007 exchange rates

  13. Magazines’ Digital Revenue There is no reliable data for the whole industry but here are some recent examples: • Advertising Age Survey, November 2007. 300 largest magazines average % of revenue from digital platforms = 3% • Meredith Corporation, US = approximately 20% • Axel Springer Group, Germany = approximately 10% • Sanoma Magazines, Hungary = 12% • Forbes Magazine = 40% • IDG = more than 50% from digital platforms

  14. Impact of Digital Publishing on Traditional Print Magazines

  15. Shift of advertising from Print to Internet

  16. Increased focus on digital media has resulted in need for improved & amplified promotion of magazines. Focus on: • Engagement • Accountability • ROI

  17. Shift in Attitude & Behaviour of Media Consumers • The impatient media consumer “I want it (entertainment & information) now” • Media viewed not as discrete pre-packaged products to be consumed but rather as destinations to be visited to get whatever information or entertainmentor socialinteractivity is available. • Magazines’ & Newspapers’ branded destinations have some initial advantage over newly branded destinations in attracting consumers but in time, the best content wins.

  18. Currently more than half of the respondents would go on buying their preferred magazine brand if it were published online only Willingness to switch to an online version of preferred magazine % of respondents who feel attached to a magazine and would go on buying the magazine if it was to be published online only The future of magazine publishing

  19. Other TrendsImpacting Magazines • Media Convergence: magazine companies becoming multimedia conglomerates and selling multimedia advertising packages. • Free or customer magazines are a growing phenomenon in the marketplace. • Partnering with search engines to grow web traffic and advertising is increasing. • Mobile phones are becoming viable platforms for digital magazine content.

  20. Other TrendsImpacting Magazines (continued….) • Video is rapidly becoming a major if not the dominant form of web content and advertising. • Magazinesthus far unsuccessful in finding ways to get revenue from consumers ondigital platforms. • The digital divide: to integrate or separate print and digital editorial staffs. • Digital Content tending towards aggregation and packaging of original editorial, user generated and third party content. • E paper: the next digital bombshell?

  21. Shift from organisation by medium … to one based on function Organisational changes are required to thrive The future of magazine publishing

  22. MAGAZINES ARE IN PERPETUAL TRANSITION, CREATING AND RECREATING THEMSELVES IN A FAST CHANGING TECHNOLOGY DRIVEN MEDIA ENVIRONMENT

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