The overall use of printed ag magazines and newspaper by farmers and ranchers in general can safely be characterized as “strong.” When one considers that print is facing challenges in other markets, it’s almost remarkable to see how print is holding so well in agriculture.
This observation is based on the 2014 Media Channel Study conducted by Readex Research on behalf of the ABM Agri Media Council. This is the third wave of the study, and as such, trends are beginning to emerge. The basic trend, that print in ag remains strong, and that digital media channels are emerging in importance as well, is very clear. When looking at “weekly usage” measures over the three survey waves, that data actually point to an incredible appetite for information and knowledge across the consumer board. Further, when we break out survey data by age, we see what some might think are surprising numbers.
The study data has been analyzed using three overarching age categories, and “younger” operators have consistently been classified as those less than 45 years of age. When answering the question, “How often do you usually read, view, visit, attend, or use the following types of agricultural media or information sources?” 81% of ALL respondents indicated using printed ag magazines and newspapers on a weekly basis. In 2012, the percentage was 82% — no significant difference. When we look at the answer to this same question based on the younger operator, 85% indicated weekly usage of these printed products and that is actually a slight increase from the 2012 measure of 81%.
Since the Great Recession of 2008, print media in general, and especially advertising-supported print media, have faced the challenge of the new information landscape in different ways. Some traditional ad-based companies have found ways to charge readers and users for their information, especially information distributed in new formats and media. Some have found ways to better serve marketer partners, moving beyond advertising to marketing services and lead generation. And some publishers — indeed, some entire vertical markets — have found ways to remain viable by continuing to sell print advertising.
Print remains a huge piece of the business-to-business media economy. For the entire industry, 29 percent of all revenue comes from print advertising. For some verticals, even after declines, the revenue remains huge.
Here is a look at monthly print revenue for three important vertical markets: healthcare and pharmaceuticals, technology, and agriculture. Even when there have been year-over-year declines, the total revenue remains important; moreover, those declines are not as astounding as those in some industries, and compared with consumer magazine and newspaper publishing. Overall, print revenue fell only 4.8 percent in 2012. For the first quarter of 2013, there was a drop of 6.2 percent, based on preliminary data … which usually skews to underestimate the final revised revenue tally. Some verticals, such as agriculture, saw positive growth over both periods.
This data is based on ABM’s BIN Report, in partnership with by Kantar Media and Inquiry Management Systems (IMS), a technology- and research-based publishing service bureau.
By Michael Moran Alterio
Every year, ABM takes an in-depth look at the workings of the industry in its Managing Profits report. I recently analyzed the 2012 data on editorial operations at print b-to-b magazines, and some interesting benchmarks stood out.
The research considered 45 different brands that included print magazine publishing as a source of revenue. In total, the 45 brands generated 54 percent of their aggregate revenue from print. However, the range was vast, from one brand that derived just 3 percent of revenue from print, to four that were 100 percent print specialized.
Looking at 45 brands that publish magazines, average number of editorial pages per editor per year is 109, and the median number of editorial pages per editor per year is 146. The scatter in this data is wide, with nine brands reporting less than 50 pages per editor, and 6 brands reporting more than 300 pages per editor. For brands reporting higher than 20 percent margins (on the brand level), 11 out of 14 produced 125 pages per editor or more. For brands reporting negative profitability, only one out of seven hit that benchmark.
The 45 brands produced 69 magazines, 30,000 editorial pages and $101 million in print ad revenue. On average, these brands saw print profitability in the 30 percent range (that’s on the brand level, not company-wide).
If you graph pages per editor on the vertical axis of a graph and print profitability on the horizontal axis, you get a graph that looks like this:
The correlation here suggests that editors are more productive (they process more pages per year) at more print-focused brands. That is, for brands that generate significant revenue from non-print sources, editors process fewer pages per year, presumably because they are processing content for online and event functions.
There is also a correlation between pages per editor and percent of revenue generated by print operations. A possible interpretation is that editors are more productive (they process more pages per year) at more profitable print brands, perhaps because more profitable brands generate more ad pages, and to support those ad pages, more editorial pages are needed. Thus, editorial staff at profitable print brands are more productive than those at unprofitable brands. For brands reporting higher than 25 percent print margins (on the brand level), the median editorial productivity metric reached 200 pages per editor per year. For brands reporting negative profitability, the median was 78 pages per editor per year. Of course, the more likely causal arrow points in the direction of increased ad pages leading to increased productivity as more work piles up, not that increasing editorial productivity drives higher profits.
Note: An “editor” is a staff member listed as compensated through the editorial line, as opposed to sales, marketing, general admin, etc. Thus, “editors” includes designers, copy editors, writers, graphic artists, managers, etc.
By Michael Moran Alterio
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.