THE magazine industry is bracing for one of its worst beatings in years on the newsstand front as the Audit Bureau of Circulations prepares to release on Monday its full report on the first half of 2008.
Consumers, faced with a dearth of celebrity scandals and a souring economy, have seemingly turned skittish on many of their favorite magazines.
“Let’s face it, magazines aren’t a necessity, they’re a luxury item and people are thinking twice about how they spend their money,” said one high-level editor.
To illustrate the point, CoMag Marketing Group, a national mag distributor owned by publishing giants Condé Nast and Hearst, put out a special report that includes the results of a survey of 2,000-plus magazine titles about first-half performance.
In it, CoMag found “softness in sales across all editorial categories, retail classes of trade and geography.” The industry newsletter, The New Single Copy, which reported the findings last week, called the report “unprecedented.”
People, which is said to have teamed up with Hello! to snag the Brad Pitt and Angelina Jolie baby photo pictures, is expecting to have a good first half, up about 5 percent on newsstand sales, after a somewhat unsettling 2007 on that front. Including subscriptions, People will be up 2.5 percent for the first half.
But the bounce it gets from the bouncing babies’ photos, which went on sale Monday, will not be reflected in ABC’s figures since they came out after the first-half reporting period.
It’s a close call for Jann Wenner and his most profitable magazine, Us Weekly.
The mag is going to narrowly make its rate base, according to industry newsletter Circ Matters, which earlier pointed out that Us Weekly was 4 percent off its promise of delivering 1.9 million copies a week through its first 19 issues. It finished with a rush over its last seven issues in the period, primarily by cranking out more subscriptions.
“We said we would meet our rate base and we did,” Publisher Vicky Rose told Media Ink.
While the more profitable single copies in the past had accounted for more than half of the magazine’s sales, it now accounts for less than half.
“Newsstand sales had accounted for 50 to 55 percent in the past. It’s now 54 percent subscription and 46 percent single copy,” Rose conceded.
But she said growing subscriptions, and using close to 100,000 “verified copies” – which are basically free to consumers – is not necessarily new.
“We’ve grown our subscriptions every single year for the past seven years,” said Rose. She said the first half will show an overall 1 percent gain in circulation.
Bauer Publications conceded that it will miss its rate base by about 4 percent on two of its titles, In Touch and Life & Style. Both had hiked cover prices by 50 percent in the period.
In Touch’s newsstand sales are down 29 percent, but the cover hike means that newsstand revenue is up by $5 million, or nearly 7 percent, a company spokeswoman said.
Still, it delivered only 955,719 on a rate base of one million. It lowered its rate base from 1.2 million in January, and still missed.
Life & Style also missed by 4 percent, the company said, delivering only 528,294 on the 550,000 rate. It formerly had a rate base of 700,000.
Short book
Who says good news never gets any attention?
Wall Street Journal reporter Greg Zuckerman snagged one of the early interviews with hedge fund manager John Paulson in January, and now Zuckerman’s parlayed that story into a six-figure advance from the Doubleday imprint of Random House to write “The Greatest Trade Ever.”
The advance is estimated to be in the $250,000 range.
The book aims to show how Paulson and a group of no-name hedge funds made the most unlikely killings in Wall Street’s history, betting that the housing market would crack, even as Wall Street banks worked to keep real estate prices climbing.
Paulson’s firm netted a $15 billion profit last year, and Paulson himself walked away with a personal cut of $3 billion.
At least a half-dozen publishers jockeyed for position in an auction that was won by Roger School, the editorial director of Double day business books at Random House Inc.
“It’s not a book about the housing crisis, it’s about a trade that will be remembered on Wall Street for a long time,” said agent David McCormick at McCormick & Williams.
Paulson was already a success, but the deal catapulted him to the upper reaches of the elite – even as many of his brethren were getting hammered.
“He went from obscurity to legendary status in a little over a year,” said Zuckerman, who declined to discuss his advance.
School said that Doubleday hopes to have the book on shelves in early 2010.