The Balance Between Draw and Sales
Publishers are trimming their one- and two-copy accounts.
BY LINDA RUTH
http://www.audiencedevelopment.com/
"You cut draw, you cut sale."
That was the wisdom of the newsstand years ago when I got into this business. It's a truism that came in for a lot of criticism and finally cycled out of favor when MagNet established a database of sales that enables a publisher or distributor to identify, on a national level, just where efficiencies need work-down to the individual retail outlet.
Suddenly it was a whole new world out there, where publishers could regain control of their distribution, where they could cut out unsolds and realize the profits that should be had in their newsstand sales.
Because despite the dictate of another piece of conventional wisdom, which insists that publishers don't care about unsold copies, that they will sacrifice limitless points in efficiency to meet their rate bases, most of the publishers I know actually are trying their darndest to bring up efficiencies. They are running their bucket analyses and cutting off the low buckets; they are paring back in channels and outlets and states and regions where returns are high; they are tightening, tightening, tightening.
In some cases, they are tightening too much.
"Why is it," a publisher asked me, "that every time I cut out my unsold copies, sales fall off and my efficiencies stay exactly where they were?"
Jim Onorato, Senior VP of Hudson News Company, has a answer for that. "In spite of everything, we're seeing that it still holds true, you cut draw you cut sale. You can't grow sale if you don't have enough copies to sell. We're seeing draws cut all over the country; some magazines deserve it, sure, but some don't."
"There are many publications out there that will never be at 50 percent," a national distributor executive recently told me. "Many publications have a strong core audience, but only one or two will buy a given issue at a given outlet. But if you only put one or two copies in, you get lost on the rack, you have no display."
"We're cutting our allotments 30 percent this issue," another large publisher commented. "We're pulling out of the one- and two-copy accounts entirely, and adding copies to the accounts that show some life. Minimum five copies per store is what we're looking for. Otherwise there is just no sense in bothering."
I asked Onorato what had changed to make publishers more conservative. "There's a negative downward pressure that has to have an impact," he told me. "Constant negativity can't be healthy for any business. It doesn't create a healthy environment. It's like a teacher saying to the students you are really no good you shouldn't be here. What does the student think?"
But how, with the daily barrage of bad news, could publishers be anything but negative about their print sales? "There is plenty of good news out there, if someone would tell it,"
Onorato said. "Elle Décor is up. Vogue's September issue was 900 pages, maybe three copies to a bundle. At Hudson News we have stores, the biggest stores in the city, re-order magazines every single week without fail. They are looking for issues they know are coming."
And what about the customer? I asked. "Their customers are readers. Their customers walk in, and they are always looking for magazines."
Linda Ruth is Principal of Publisher Single Copy Sales Services. Her book of case studies, "How to Market Your Magazine on the Newsstand," is available at BookDojo.com and atAmazon.