The print trade bottom line for 2011 and beyond

The entire b-to-b information industry – from conference keynote speakers to investment bankers to pundits, prognosticators and even publishers – seems convinced that print is dead, and the paper magazine business is just one more shambling corpse among the many we see on TV these days. The reality is something different.

Certainly, the newspaper business is in trouble. Every year, the Pew Research Center puts out a “State of the News Media” report. The most current report states: “Most newspapers are profitable on an operating basis, many with margins in the mid-teens. But net margins – after interest, taxes and special charges – are razor-thin. And most papers achieved profitability largely through cutting.” 

However, the picture for trade press magazines is a little more sunny. A wide census of trade magazine ad pages, conducted by Inquiry Management Systems for ABM’s BIN Report, concluded that trade ad sales rose 3.8 percent over the 2010 to 2011 period. A more limited sample of 26 companies who participated in ABM’s Managing Profits research reported that print revenue declined 2.3 percent over the 2010-2011 period. Those 26 companies may be underperforming the industry total, but even they are doing better than newspapers on profit margins: these 26 companies reported an aggregate profit margin of 16.7 percent for 2011.

That 16.7 percent print margin is for all 26 companies in total, some of which are not primarily print oriented. The Managing Profits research took an even closer look at 34 print brands. Considering total revenue and total expenses for these print brands, the aggregate profit margin was 23.0 percent. And considering only print-related costs and print-related revenues for these print-specialist brands, the profit margin was 35.5 percent in 2011. The takeaway is that print can be quite profitable, even today, for a subset of the industry.

That subset includes several vertical niches, including business, advertising and marketing publications, which saw ad sales rise 28.2 percent in 2011; transportation and logistics publications, up 14.5 percent; and agriculture, up 12.6 percent, per ABM’s 2011 year-end BIN Report. In support of these numbers, ABM’s Ag Council recently conducted research that found very high engagement levels among readers.

Engagement among advertisers is also high. In a recent survey of big-brand marketers from companies such as Unilever, Pepsi and Coca-Cola, 94 percent vastly disagreed when asked if print is dead. The research was cited in an article on the value of print, in Magazine World, published by FIPP, the global magazine association. (hat tip,

But there is no question that in total the print trade news business faces great challenges. Although the precipitous drops seen in 2008 and 2009 are behind us, it says something that modest declines are good news. Comparing 2010 to 2011, total number of publications dropped 3.2 percent; total folio pages dropped 8.0 percent, and of those folio pages, 54.2 percent of them consisted of advertising pages in 2010 vs 51.1 percent in 2011. The fact that print revenue fell only 2.3 percent while total ad pages fell 8.0 percent suggests that publishers have been able to raise ad prices, a possibly optimistic sign for an economic turnaround ahead. The vast bulk of print revenue continues to originate from display advertising. Fully 83.9 percent of print revenue derived from advertising, up three percentage points from 2010.

To put these figures in perspective, compare the data for 2011 with data from 2007, gathered by ABM with a similar research project then called the Media Cost and Revenue Report. These graphs of revenue sourcing show how incoming revenue streams have changed drastically in recent years:


Based on the data in hand, the short- to medium-term forecast for print magazines is not death. Print will not regain the primacy it once had, but there is every indication that it will be one of several sturdy legs on which the business media and information industry stands.

By Michael Moran Alterio


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