Magazine publishers should acknowledge that every attempt to get into their customers‘ lives will fail unless it is based on understanding their customers‘ goals, needs and contexts of media usage. A recent example: Publishers enhance their print magazines because consumers are not looking up from their smartphones in checkout lanes, critically hurting single-copy sales. What customer goals are they trying to satisfy? If publishers will not adopt to consumers, they might end up as another Kodak.
Imagine this: You are a magazine publisher and you see single-copy sales are going down. Of course, you noticed that a few years ago, and in the first half of 2012, the slide was almost 10% [1]. Time Inc. saw its flagship title lose almost a fifth of its single-copy sales in the first half of 2012, adding to the cost pressure that led to its shedding 8% of its workforce. This would not bother you, if your print advertising business was healthy and print subscriptions were up. But they are not.
So, this is something you decide to work on and you analyse the situation. You quickly find a major cause for the drop in single-copy sales: Consumers who used to screen magazines exhibited at checkout lanes are now looking at and typing away at their smartphones.
What’s your reaction?
A) You acknowledge that single-copy sales are a lost battle and decide to adjust your cost base and invest in selling more subscriptions (which probably means checkout lanes will feature more candy and less magazines).
B) You make your magazines shinier (which probably means more naked skin, shrill colours and shorter bigger headlines) and print some QR codes on it to try and convey the impression that this is the best way to enter your web presence: Buying a magazine and then scanning the QR code.
C) You use the space you rented at checkout lanes in order to promote yourself as a company worth considering for staying up-to-date and entertainment in the digital space.
According to a recent Financial Times article reporting on the topic, publishers are mainly opting for option B, as absurd as this may sound:
Publishers are trying to combat “mobile blinders” by jazzing up their print magazine covers with attention-grabbing digital features and placing copies in different areas of a store. Cosmopolitan put a digital QR code on its September cover, tempting consumers to scan the code each day for a surprise deal.
It’s comforting to see that Germany’s biggest journal publisher, Axel Springer, announced a collaboration that seems to be a grown-up bet on digital, collaborating with experienced startup investor Plug and Play Tech Center to develop and implement digital business models. Since they are already pursuing a quite successful digital strategy, they will be able to tweak and add to their offering in a way that generates competitive advantage that will threaten other publishers‘ business models to a degree that some of them might be turned into a Kodak.
In a market with a high level of strategic uncertainty, companies need to think about where they want to reserve the right to play – instead of betting on a single product portfolio that might generate diminishing returns, draining the cash they needed to innovate and transform the company to acquire the necessary skills to play in a „digitised“ market.
The best way to create strategies and offerings for the „digitised“ market is, in our experience, to start with a deep understanding of market players and customers and find a position that generates competitive advantage. You can get an idea how we go about it downloading our approach:
Download Stimmt’s approach: Using personas to create strategies and offerings (PDF, 352 kB)
Notes
[1] Single-copy sales of the top 25 magazine publishers in the US: Heavy losses, with a few exceptions.