Circulation marketing strategies evolve

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Acclimating to the constant evolution of reading channels, like Kindle, iPad and online, experts talk about how their circulation strategies attract new readers and retain current ones in the e-reader age

Kenneth Sheldon
Director of circulation, New York magazine

New York magazine's circulation showed continued strength in recent years and is poised for profitability growth this year and beyond. These gains are primarily being driven by price increases coupled with more efficient expense allocation and management.

For direct-to-publisher acquisition sources, neither price increases nor trimming expenses selectively has had an adverse effect on subscription order volume (actually up 3% this year). New York magazine's direct mail campaigns are achieving record response rates and are profitable within the first subscription term. Internet orders are growing as the magazine is becoming more sophisticated with leveraging e-mail files and targeting conversion efforts more effectively on Subscription prices were raised for agent and other external sources, and the magazine has seen stability in order volumes there via gains in market share. Internet agent volume has almost doubled as targeted dedicated efforts for the magazine have been secured.

Moving beyond new business subscription sources, renewal rates have climbed nicely, and there has been no decipherable recessionary impact. Leveraged opportunities that have helped renewal performance include the increased use of e-mail promotions and growth in the portion of subscriptions on automatic renewal platforms. For the newsstand channel, the magazine has taken deliberate steps to reduce expenses and increase profits. Significant cuts to draw (the number of copies sent to newsstands), reduced newsstand advertising spend and a 25% cover price increase have impacted average sale levels but have had a positive impact on profitability.

New York magazine is testing sources such as SEM and promoting in social media to hopefully replicate successes seen there with growing Web audiences. While social media will undoubtedly be a big part of future subscription production, it's the strategic decisions the magazine has made with traditional sources that are responsible for the current momentum. Adjusting pricing and minimizing marketing costs aren't new ideas, but New York magazine is reaping nice rewards from being aggressive on those fronts.

The Takeaway
Strategic price increases can boost revenues with limited impact on circulation numbers

Jeanniey Mullen

Global EVP, CMO, Zinio LLC and VIVmag

Three years ago, if someone asked me what the circulation management strategy for our all-digital magazine VIVmag was, I would have sounded just like anyone else: Leverage direct mail for circulation growth, focus on e-mail as a way to engage readers and drive interest, and publish sales as a standard page or spread rate. Looking back at our consumer marketing plans now always makes me laugh.

In three short years, the intersection between customers' demands for convenience and technological innovation, has left us no option but to rethink every single way we build relationships and communicate with our customers. Our magazine and many of our publishers on the Zinio side of the house have been able to build a better future for their business. Three of my favorite changes are:

Twitter — Twitter was built by an older community as a networking tool. Twitter drives sales, and it has become a key element of circulation growth. Building a content distribution strategy across this network will pay major dividends. Facebook is great, but it was built by a social generation to connect socially, so I have found it doesn't always drive droves of business.

In-person events — hosting reader events has become a huge hit for VIVmag. It enables people to come to the event and take out all of their new devices — iPhones and iPads — to show what and how they read VIVmag. You can't ask for a better technology focus group than these events. Readers also usually bring prospective subscribers with them.

Good old analytics — as a final favorite, we have seen the use of the traditional data overlay as an element of our success. Our demographics and targets have shifted as the devices VIVmag is available on have changed. Keeping up to date with the insights on who our reader is remains essential to our successful growth.

The Takeaway
Embrace new technology (e.g., Twitter, the iPad) to replace old circulation tactics

Greg Wolfe

President, Circulation Specialists, Inc.

For most of our clients, print magazines and traditional media make up the vast majority of the circulation, marketing dollars and revenue.

In terms of circulation marketing, the volumes we are getting from online sources are still modest. I think for most magazines they are in the 10% to 20% range of total circulation. This is a growing and important source, but it is not dominant in the way direct mail has been. Paid search is not very effective for magazine marketing, and e-mail lists tend to be small compared to postal lists, with response rates often only one tenth as good as direct mail. However, e-mail has become a standard, effective part of the circulation marketing mix, particularly to house names for renewals and gifts.

Response rates to direct mail continue to be much higher than for online media; cost per order is often lower and the volume opportunities are much greater in most situations. In addition, with more cooperative databases coming into play and ever improving modeling techniques with lower costs for use, we are seeing strong results with our direct mail campaigns.

We are still in the very early stages of magazine content being read on mobile devices such as iPhone, Kindle and iPad. This is a very exciting area of opportunity for magazines, but it is not a significant part of the business model in terms of circulation or revenue at this point. We have found ways to effectively use "flip-book" digital replicas of our print magazines, but these are mostly for nonpaid sampling, added value or sponsored paid circulation. It is pretty clear that most consumers do not want to pay for digital replicas of print magazines that they read on their computer.

This will quickly change over the next few years as the reading experience becomes better, cheaper and faster on digital devices. It will dramatically alter the way circulation is sold. If the majority of reading is done on electronic devices, the majority of circulation will be sold online at publisher's websites, through e-mail and at third-party sites like iTunes.

The Takeaway
Response rates to direct mail remain higher than online tactics

Teresa Perry

SVP of publisher member audit and report processing services, ABC

ABC (Audit Bureau of Circulations) receives numerous queries from publishers who want to understand how to qualify and report digital editions on their ABC statements.

At its March meeting, the ABC's board of directors modified the guidelines surrounding magazine digital editions to be more accommodating to new technologies. Now, to qualify an e-reader or mobile editions as paid circulation and have them count toward rate base, that digital edition no longer needs to be an exact copy of your print edition.

There are still a few guidelines that magazine publishers must follow.

First, your editorial and advertising content must be integrated throughout the digital product. Don't try to hide advertising content behind a separate tab or section of your digital edition. It needs to be a part of your digital magazine, just like it is part of your print magazine.

Next, include all of the editorial and advertising content from your print magazine in the digital edition. The digital content doesn't need to be presented in the exact same manner and layout as the print publication, but the same information must be presented in both versions. If advertisers opt out of the digital edition, you aren't required to include their ads but you can substitute other ads or sell additional advertising in the digital edition that is not in the print version.

Also, try to incorporate additive content, such as additional advertising, hyperlinks, video, audio, slide shows and other technologies. Adding this information does not impact your ability to qualify the digital edition circulation as paid and count it toward your rate base.

Finally, make sure you charge your subscriber at least 1 cent for the digital edition, and make sure the subscriber specifically requests that your publication be delivered in the digital format.

The Takeaway
Qualify both your print and digital editions to demonstrate full circulation

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