Economics & Research Blog
Vogue's Print Ad Rise Has Very Little to Do with Print, Lots to Do with Branding, Research, and Competitive Action
I saw a few citations of an article Mashable about the success of Vogue'
By Dr. Joe Webb
Published: August 26, 2013
I saw a few citations of an article Mashable
about the success of Vogue's
September edition in terms of ad pages. The 665 pages was its second best in its history, when it had a September edition count of 727 pages in 2007. For those who cite this as positive for print, the irony of linking to Mashable (a digital publication) is amusing. And if it was a story about print, a wide range of publications, not just Vogue
would be up, and up in similar degrees.
Why is Vogue
not about the "power of print"? The Vogue
story teaches a greater lesson that print businesses should take to heart. It's not a "cheerleading print" story at all.
Since 2002, the magazine business has been a disaster:
- US population is up +9.4%, but magazine circulation is down -13%. That's more than a 22 percentage point spread.
- Consumer magazine ad pages are down -33.6% at a time when real GDP is up a cumulative +19.8%, a more than 50 percentage point gap.
So much for the power of print. But how about the power of Vogue
in this environment?
The ad count cited in Mashable is not that good. It's still -8.5% off the high it set in 2007. That's not the story, either.
What's the story behind Vogue
? It's nothing to do about print in and of itself, and should not be cited as such. It's all about competition, transformation, the value of branding, and knowing your customers. Claiming it's a good sign for print without the rest of the story sends a message that things can get better with waiting and hunkering down. Vogue's
milestone is nothing of the sort.
The magazine's statistics are not all that good on the surface. When you compare them to the industry, the difference is stark.
Since 2002, industry ad pages are down -33.6%, but Vogue
is down -10% Vogue
was hit especially hard by the recession. Its ad pages dropped more than -30% in 2009, when consumer magazines were down -25%. Since that time, Vogue
has climbed back to be down -10%, while the industry is still going down.
gue's 2012 ad pages were down -10% compared to 2002, the industry's is down -33%, so Vogue
is clearly moving in the opposite direction.
While this was going on, Vogue's
circulation was basically flat, but even that was an achievement. Subscribers are up 23% since 2002, and that's a good thing. There has been consolidation in the women's fashion and sophisticate magazines, and Vogue
has no doubt benefitted from the decreased competition in its category.
The magazine business has had a sharp drop in newsstand sales. Like others, Vogue
has had to work hard to get its subscriptions up to replace the those sales. Consumers don't shop for magazines as they used to, and bloated single copy prices have discouraged many consumers from picking up a copy. Consumers realize that it's a lot cheaper to subscribe than it is to buy. From the magazine's perspective, a predictable and reliable subscriber base is what assures advertisers they have an audience worth reaching.
Single copy sales are way down, basically for everyone. Magazine insiders have complained for decades that the single copy distribution model is broken, but when I put my economist hat on, they might as well be complaining about the weather… or the postal service. Nothing is going to happen with it other than digital replacement.
Total newsstand plus subscribers for Vogue
is up just 1.4% since 2002, and is down from a recent peak in 2007. The number of subscribers has not kept up with population, but it has remarkably survived when competitors have not, and shifted its circulation to the more valuable subscriber side of the business.
There are no reliable data about ad revenues; they are kept private. The Publishers Information Bureau issues reports based on rate card data, but that would be like Wal-Mart reporting its revenues using list prices. No one believes rate cards and their prices. Everything is up for negotiation. It's hard to measure how business is doing at one particular title. Even though the data are hard to trust, Vogue's
ad revenues calculated in the manner are up 74% since 2002.
No one believes rate cards, but we can adjust them for inflation anyway. Using this measure, revenues are up by 37%, but are not near their peak which was 2007, the year before the recession hit. By 2009, revenues were slightly below 2002 levels. The magazine has recovered when others have not or have disappeared.
One of the ways that it seems Vogue
has managed to navigate lesser ad pages and stagnant circulation is by charging more for ads.
If you can't believe rate cards, and can't believe inflation-adjusted rate cards, then you probably should not believe inflation adjusted ad revenues divided by ad pages. The per page price for Vogue is up 52.3%. That's the highest it's been since 2002. Despite recessions and slow economics, there's not a single year that Vogue has not had a price increase when measured in this way. That is, if you believe list price is the way to judge things.
One's never really sure what goes into negotiated agreements, and if they have bundled digital advertising into the package and how that might be allocated to print ad pages, if at all. But to pull off a stunt like increasing ad page prices despite a stagnant subscriber base that can't keep up with population, decreased number of ad pages is either sleight of hand, genius, or both.
What's the point?
Conde Nast, from all reports, is outdistancing its competitors. The company appears to have the best handle on what's going on in media and where print fits in the constantly changing media mix. They are testing the bounds of what makes print attractive and what builds audience curiosity and interest.
Let's also be clear. Vogue
and other Conde Nast titles do not have the same number of competitors they used to nor have their competitors adapted to new market conditions as well as they have. One of the reasons ad pages are up is that there are fewer places for those ad pages to go. There is some benefit of consolidation in the Vogue
ad page increase.
The "see, print is not dead
" citations are missing the point of what Conde is doing and how creatively hard the company is working. By not telling that whole story the printing industry at large is inadvertently being told, yet again, that the declines in print are essentially economic, and that a generic rise in volume may be on the way. This misses the connections of brand and the integration of other media to attract, maintain, and grow an audience. It is those actions that have increased Vogue's
ad pages, not some love of generic print.
Earlier this year, I was at a presentation made by one of the Conde market researchers -- they spent over $1 million on research last year. That process has led them to focus on using print for things that cannot be duplicated in other media. They have experimented with huge high quality images folded and inserted into the magazines, and have a renewed focus on page design. Those designs are built on the deep knowledge of the unique demographics of each brand.
Web pages and smartphones and tablets are limited in what they can do, mainly because of the screen size. The drill-down links in web pages is actually an accommodation for the lack of visual space for the presentation of images and text. Conde has been playing off that weakness in their page designs. They know that all content has to be optimized for the medium in which it appears. They know that optimization is constantly changing for print as digital media's characteristics continue to change.
Lessons for Printers
The media mix is constantly changing, and Vogue
, and Conde Nast's brands are in the thick of it. They research their markets and audiences as part of gaining a competitive advantage against other titles and to more fully understand their audience. That research gives them a selling edge for limited advertiser dollars. They also have strong brands, and fully support those brands, defending competitive attacks, and enhancing those brands. Conde also uses other media, and not in a half-hearted way. They emphasize doing it best in category, because that supports the brand.
How many printers do research? How many of them have brands? How many printers have full commitment to experimenting with new media and using it in their business to the fullest extent they can?
is in the fashion business. The research they do gives them a position where they can lead their audience in their thinking and their wants and needs. They set a trend. Is your business well-versed enough to counsel your client about what's ahead in media and how you're capable to help them understand it?
That's where the real message is the the Vogue
story. It's not about print. It's all about Vogue.
* * *
Another story that's been making the rounds was in the Atlantic
. It's titled "The Death of Print Has Been Greatly Exaggerated
." Yet when you read the story, it's about how print won't die quickly but will be a long, drawn out process. Gee, thanks.
* * *
Some of you know that I am a collector of radio programs from the 1930s to the 1960s. I have over 100,000 recordings, and as a result of digital technology, those 50,000 hours of programs fit on a 2 terabyte hard drive. Amazing! I used to have 2500 reels of recording tape, weighing 2200 pounds, and now it all fits on a device weight 2 pounds that is far easier to use and costs less than $100.
I do a lot of research on the era, and I came across this story from Sponsor magazine
from 1950. This was a trade magazine for station owners and salespeople, and radio ad buyers and their agencies.
Industries in transition are difficult in many ways, and this particular article from 1950 is rather interesting in light of our own industry's struggle. In 1950, the radio battle for ads was about to be lost. The year 1948 was the greatest adoption of TV technology in the home as post-ww2 economic rebirth was in full swing. Agencies were pulling dollars even though TV was comparatively expensive. They tried to use the radio advertising model where there was one sponsor per program, but budgets said otherwise. Non-competing sponsors often alternated sponsorship weeks for top-rated shows. As radio ad budgets got pulled, radio program production budgets were cut (orchestras gave way to recorded musical bridges, sound effects became a combination of recordings and live production, lower-priced acting talent were hired, scripts would be repeated rather than being new every week). Low cost programming, like news, and eventually recorded music (with hosts called "deejays") pushed dramas, comedies, and soap operas off the schedule. It turns out that 1950 was a year that started that transition from a business perspective, so finding this article was interesting for me.
This article claims that there are many more users of radio than were being picked up by research or other data. I have never been in a declining market (or company) where there were not people claiming an undercount of of the market. They often claimed that they were not getting their due of attention from the marketplace. In sales, there would always be a claim of safety in sticking with something proven. In this case, it was radio... you can't believe that stuff the TV sales guys are saying, can you? Spending on TV is risky and a wise person would avoid it. At least that's the word from 63 years ago. It does have a familiar ring to it.
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