The Revenue Tipping Point

It’s been a challenging time to be a print publisher. In the US – the print publishing industry has been experiencing the perfect storm - we’ve seen circulations fall; margins and revenues erode as new generations abandon traditional print and question its quality and independence.  Many mainstream media organizations are upset that the print world they knew and loved has changed so much. Like a death of a loved one, publishers are dealing with several stages of emotions over the loss of a traditional, well-understood business.  OK, It’s time to let go and get over it. Let’s face the reality of the loss, deal with the pain and adjust to the current environment by investing in the new reality and our future.

In the segment in which we operate - information on technology, the stark reality is that print is not rebounding and is not likely to. Every year our print ad market contracts in terms of total advertisers and total pages and revenue and our print circulations fall.  There is nothing on the horizon that indicates any sort of reversal of this trend. Print’s not dead, it's just becoming a smaller less profitable business, and we have to adjust [our brains and] our P&Ls to the market reality!

At approx $3 billion the US online tech-advertising category is one of the largest ad categories on the net.  On the readership side, some of the most popular search is for tech-related products.  We are in a great category in the online world and we are seeing massive growth in the overall readership of our branded properties and strong revenue growth - however we recognize that this is a world where the competitive set is a lot broader and more challenging and the content distributions channels are very different.  - I like our odds but it requires a massive internal attitude adjustment to deal with the new reality that our brands go far beyond print.

Our key significant strategic imperative is to transition and transform the company - taking a 40-year print legacy that’s coded into our DNA to build the company on a balanced portfolio of print, online and event products.  Advertiser and users are spending less time with the printed medium so we have to adjust our business accordingly. This evolution away from print has challenged some of IDG’s traditional managers who have thought of their brands in narrow terms - but we have many individuals who are willing to think of their products as brands across multiple media types and also to look at audiences across brands, recognizing the amazing opportunities that are ahead of them.

We think about how to develop valuable, authoritative content and how to deliver it most appropriately to our users in what everyway makes sense to meet their needs  - we’re liberating ourselves from the restrictions and cost of the print container. The brands represent the voice and participation of their communities – and it’s this user participation that differentiates them from search and aggregation.

This transition covers every aspect of the business - it’s tricky, as we have to balance the need for appropriate continued investment in print while allocating significant resources to ensure we power online growth. Transformation involves a deep cultural shift in attitude to put online first and stop over protecting print.

Interesting times.

Comments

[panasianbiz]

I stumbled across your blog while I was doing some online research. You make some excellent points and do so in a concise, well articulated style. Thanks for a great read!

[carol chamberlain]

The reluctance to give up print for many of us is in the association. Computing equals work and mags equal relaxation.

The breakthrough happens when laptop meets recliner. But what about the photos?

[ccoc]

The point about the lean back aspect of magazine compared to the lean forwead interaction of online is correct. The mediums are very different - it's not either or. However, the economics of print compared to online are challenging. The tipping point is here and media executives have to adjust to that reality.

[Brian Giese]

I have to say, Colin, you really nailed it on this post. Thanks for the honesty. Print is really declining in readership (look at ADVO being sold recently) and online media is exploding. Isn't it the responsibility of media companies to put the ads in front of the eyeballs? It's already tipped.