The weekly magazine market has taken yet another blow as Australian consumers pull back discretionary spending and the reality of the cluttered weekly market begins to take its toll on circulation.
The Audit Bureau of Circulations figures for the three months to December 2008 reveal that of the 16 weekly audited titles, 11 have experienced year-on-year declines of over 10%.
ACP Magazines’ New Weekly has been hit the hardest in what has been described as the “one of the most difficult consumer spending periods”, falling by 16.4% year-on-year. Pacific Magazine’s New Idea and ACP’s OK! and flagship Woman’s Day also felt the brunt of more cautionary retail spending with drops of more than 12% in the latter part of last year.
Meanwhile Grazia’s (ACP) first official audit since launching last July listed a circulation of 65,000, a 7% drop from its debut preliminary audit on 10 of its issues in the previous quarter. And Zoo Weekly (ACP), which just a year ago was monopolising the men’s magazine segment, has fallen by 8.1% year on year. However, Famous (Pacific Magazines) has defied market trends to come out on top with a 1.6% circulation increase year-on-year, and quarter-on-quarter growth of 16.4%. Take 5 (ACP) also achieved a 3.5% increase in circulation.
While these are brutal figures, this is not the first audit period in which weeklies have felt the pinch of the economic downturn. After experiencing circulation growth during the January to March quarter last year, numbers across New Weekly, New Idea, OK! and Woman’s Day declined during the subsequent April to June and July to September quarters.
Interestingly, Nick Chan, CEO of Pacific Magazines, insists the market is stable. “If we look at the market from period to period it’s flat for all intents and purposes,” he says.
The latest ABC results come as no surprise to media analysts contacted by B&T. They cite consumer spending power, competition in the weekly market and the value offerings of individual titles, including cover price, content and special offers, as the big determiners of sales.
“Nothing in the economy has changed that would have lead us to believe (the results) would change,” says Simon Davies, head of print at OMD. “The numbers are in line with our expectations.”
Nick Keenan, head of non-broadcast at MediaCom, says weekly magazines are at a disadvantage as the whole retail sector suffers.
“Magazines are a discretionary spend, they are bought at the counter and it’s that home budget that’s being tightened right now,” he explains, adding: “The titles that have remained steady, or are up, are simply the result of people picking their favourite. So, instead of buying a number of mags they’ll pick and choose the one they want most.”
Jackie Edwards, national buying director at Initiative, agrees: “What generally happens in a recession is that instead of a person buying four magazines a month they might only buy three, or if they buy three they only buy one, whichever is offering the best cover or value,” she says.
The rise in Famous’ circulation, which was in steady decline since the October to December 2007 period, has been attributed to its drop in cover price to $3.50 and the redesign of the title late last year. “If you go back to the last audit I think it had a hit of about 18% (compared to the same period in 2007) and the reaction strategy to come back from that was to reduce the cover price and refresh the mag,” says Keenan. “I think those two strategies have worked very effectively.”
Steve Allen, managing director of Fusion Strategy, says the most recent circulation results show the changes to Famous “are a step in the right direction.”
Pacific’s Chan adds that he feels it would be unfair to attribute Famous’ growth to the cover price decrease alone. “I would think that if we hadn’t made the changes to the mag and we just changed the cover price we wouldn’t have the impact we do today,” he says, adding: “It has impacted NW and Grazia which is where we’ve been targeting all the time.” Following New Idea’s ongoing circulation drop, finishing up with a 15% decline year-on-year, the magazine is also in the midst of a redesign and will be supported by a campaign push this year, according to Chan.
Despite a cluttered market and a “sameness” among weekly titles being proffered as a reason for circulation decline, Grazia, which differentiates itself with its high-fashion content, has been unable to attract the sales it had anticipated.
“(ACP) has tried to launch something unique and while it’s a good mag, its business model is inherently flawed in this segment,” says Keenan. “It’s trying to do what a monthly does on a weekly basis which may not be the right thing to do.”
When considering the year ahead for weeklies, some analysts are quite sceptical, predicting magazine closures by the end of the year, while others simply shrug their shoulders.
