Established Magazines Sink But New Titles Bubble Up

The game has changed for publishers of business magazines, as described in today's Wall Street Journal.  The old days of selling (or giving away) subscriptions to well-heeled executives and  piling on the ads for cars and financial services no longer seem to work.

Witness the declining ads at top-tier magazines like BusinessWeek and Fortune, as well as the thinning ranks of relatively younger titles with the demise of Business 2.0 and periodic reports of financial strain at Red Herring (again.)

Here are some of the warning signs of disruption that the Journal observes:

• Established management playbook fails
• Established suppliers continue to improve their product by old standards (redesigns and reorgs)
• New entrants with strange business models make inroads (Internet)
• New competitor takes share and is dismissed as 'inferior' (Conde Nast's Portfolio magazine)

Out With the Old...

I happened to be reading Warren Buffett's latest annual letter to shareholders yesterday and his comments on newspapers, including the Buffalo News, which his company owns, seemed relevant to magazine publishers:

"Eventually eroding fundamentals will overwhelm managerial brilliance.  And fundamentals are definitely eroding in the newspaper industry, a trend that has caused the profits of our Buffalo News to decline. The skid will almost certainly continue.

Almost all newspaper owners realize that they are constantly losing ground in the battle for eyeballs. Simply put, if cable and satellite broadcasting, as well as the internet, had come along first, newspapers as we know them probably would never have existed. However, the economic potential of a newspaper internet site – given the many alternative sources of information and entertainment that are free and only a click away – is at best a small fraction of that existing in the past for a print newspaper facing no competition... the days of lush profits from our newspaper are over."

And In With the New...
Of course not all magazines are dying. And there are occasionally startups that show a path to a new emerging market.

Muslim Girl, published by ExecuGo Media strikes me as a new disruptive medium because:

• It reaches a new market that was previously deemed unimportant to mainstream media: 400,000-500,000 Muslim girls in North America
• It is global in its appeal
• There is a worldwide shortage of popular media content directed at Muslims

One though: Disruptive products typically need disruptive distribution channels to establish themselves. The reason:Muslim Girl will struggle for space on news stands and will not initially be able to lure mainstream advertisers away from Seventeen, CosmoGirl and other established titles. Muslim Girl looks great in print and on the web, but wouldn't a mobile version on cell phones appeal to hundreds of thousands of teenage Muslim girls? Teenage girls and cellphones go together well. 

Comments

[Jack]

I buy magazines for my daughter from Barnes&Noble store at Couponalbum.com.......!!