UK consumer magazines Two-tier market opens up
Douglas McCabe +44 207 851 0910 [email protected] Thomas Caldecott +44 207 851 0914 [email protected]
31 July 2014 Executive summary
• This is the first of a two part report on the UK consumer magazine sector – In the first part we focus on consumer demand for print magazines, genre analysis, magazine advertising and publisher performance – We also provide advertising forecasts in print and digital to 2018 – The second part of our report will cover the digital and innovation landscape including a case study of Good Housekeeping’s transformation strategy, which is being launched in Q4 2014 • Magazine circulation decline has accelerated, with paid magazine volumes falling 10% last year – about 1.6m magazines per week • Circulation revenue also fell 10%, as a result of the most intense discounting in the sector since 2010, offset by cautious price increases • Print advertising decline accelerated in 2013 to -8% while digital grew by 12%, the sector falling about 5% (£30m) in aggregate. Digital advertising (£91.5m) now represents about 15% of total magazine advertising • We forecast print advertising decline in 2014 of -6%, which assumes a strong second half • Digital editions are failing (only one title is selling to 20k consumers) and digital advertising rates are under relentless downward pressure. Importantly, they are generally measured by ROI, diminishing the importance of media environment and consumer engagement – a battle the industry has to take on more forcibly • Differentiated, upmarket, category-leader titles aimed at older demographics are increasingly outperforming across almost all magazine genres, both in terms of circulation and advertising trends – creating a two-tier magazine sector • Older demographics remain attracted to print, and are an increasingly important audience for many brands – though publishers need to spend more time persuading agencies and brands of these advantages • Publisher profits grew in 2013 as costs were taken out more quickly than income contraction, and a stronger economy should help in 2014 and 2015 – though the two-tier market will diverge the winners and losers
UK consumer magazines: two-tier market opens up [2014-063] 2 Defining the attributes of the two tier magazine marketplace
• Magazines are a hugely heterogeneous marketplace, with hundreds of • Nevertheless, there are common ingredients among successful and general and specialist titles across many dozens of genres unsuccessful magazines. Some very successful magazines have some of the negative attributes listed below, but none have all of them • Performance is likewise highly diversified, and the balance of consumer spend and advertising income varies enormously • The key strategic elements are • We are often asked about the relative strengths and weaknesses of a – Positioning and confidence title, a simple question that requires a fair amount of bespoke analysis to – Audience elicit a granular and useful answer – Barriers to print and digital competition
Consumer magazine titles performance drivers
Positive attributes Negative attributes
Differentiation – market of one Poor differentiation in a pool of many titles
Content tone is assured, confident Content tone is bland and inconsistent
Upmarket – ABC1 readership Downmarket – C2DE readership
Older readership – 40+ years Younger readership – teen to 40 years
Timelines of content: not urgent (this month/week, but not this hour) Timeliness of content: urgent
Subscribers Newsstand
Massive industry / consumer interest Small industry / consumer interest
Publisher investment Publisher running it for cash
Female Male
UK consumer magazines: two-tier market opens up [2014-063] 3 1. Paid circulation 2. Genre analysis 3. Advertising 4. Publisher performance
UK consumer magazines: two-tier market opens up [2014-063] 4 Measuring circulation using ABC: our methodology
• All circulation data in this report is sourced from ABC. However, Circulation per annum and circulation change (m) 3 reporting ABCs is optional. Thus, some titles begin reporting ABCs long 1200 after they have actually launched; some titles stop reporting ABCs even -17 -3 -63 though they continue to publish; and some titles may skip a reporting 1000 period (whether by accident or design) 800 • The chart top right breaks out annual circulation and how the 80m 600 1,173 copies lost across the industry between 2012 and 2013 break down 1,093 400 – Like for like: titles that reported ABCs in both 2012 and 2013. These titles lost a total of 63m in 2013, down 7% compared to 6% in 2012, 200 indicating a slight acceleration of the underlying fall in demand 0 – Closed: the closures of 11 titles accounted for 17m lost copies in 2013 2012 Like for like Closed Launched Other 2013 compared to 15m copies lost from 15 title closures in 2012. More!, [Source: Enders Analysis based on ABC data] Full House and Easy Living were the most high profile print titles to cease publication, accounting for for 80% of total copies lost from the market to closures – Launched: 17 titles began reporting ABCs as a result of launching in the last two years, adding 3m copies to the market. – Other: the remaining 3m copies were lost only on paper. These titles are still – and intend to remain – in publication, but did not report ABCs in 2013. Some publishers feel ABC does not sufficiently reflect the scale of their multi–platform audience and are moving to new, bespoke auditing solutions such as that developed by PwC. In other cases titles still registered with ABC have failed to submit their circulation data for the 2013 audit periods • Throughout the rest of this report, for simplicity, we do not break out circulation in this manner
UK consumer magazines: two-tier market opens up [2014-063] 5 Circulation overview
• Consumer magazine audited print circulation was 1,093m in 2013, down Circulation per annum (m) 7% on 2012 or a loss of about 1.5m copies per week 1,800 1,686 1,647 1,539 • The overall rate of circulation decline was flat on 2012, but only 1,600 98 106 1,478 100 because the growth in free (primarily, the first full year of Time Out) 1,400 376 96 1,262 393 1,173 continued to soften the accelerating decline of paid 1,200 371 361 94 1,093 83 210 82 – Free distribution rose 6%, 90% of which was provided by Time Out’s 1,000 215 224 first full year as a free publication 800 600 1,212 1,147 – However, UK paid circulation across all titles experienced 1,068 1,022 958 400 875 787 accelerating decline for the third year in a row despite an improving 200 UK economy, down 10% compared to 9% in 2012 0 • This pattern tallies with the overall demand for the UK press market 2007 2008 2009 2010 2011 2012 2013 which has decoupled from consumer spending patterns UK paid UK free International [Source Enders Analysis based on ABC data] – Data from ONS’s Q1 2014 Consumer Trends Survey shows that Circulation per annum, year-on-year growth (%) household spend on newspapers and periodicals fell by 9% from 5% 4% 2010 to 2013 while overall spend on culture and recreation increased by 6% 0%
– As with newspapers it is clear that circulation patterns are now being -2% -2% -5% -4%-4% dictated by fundamental structural problems facing print rather than -5% -6% broader cyclical factors – and we predict the acceleration of this -7%-7% -7% -7% -10% -9% structural decline will be exacerbated by title closures in the five- -10% year horizon -15% Closure of Sky’s magazines -15% drags free circulation -20% 2007 2008 2009 2010 2011 2012 2013
UK paid All circulation All circulation includes free and international sales [Source Enders Analysis based on ABC data]
UK consumer magazines: two-tier market opens up [2014-063] 6 Magazine frequencies
• As the internet took more and more time away from magazines, slow- • Weekly and monthly magazines have each lost about a third of their moving monthly titles were disproportionately impacted volumes since 2007 (weeklies marginally more) • Since then the mobile revolution has kicked-in, making many weekly • However, the absolute decline of weeklies is a more substantial problem titles look more vulnerable – in total, weeklies are selling 6.5m fewer copies now than in 2007 • In 2013 the two frequencies seemed to converge, with rates of decline • There are two important implications in this hovering around 9-11% – Weeklies provide wholesalers and retailers with substantial volume business, and work harder at keeping retailer merchandising fresh – Supermarkets, which trigger more than half of newsstand sales and (across their business) are focused on rapid stock turn, are particularly conscious of this merchandising challenge
UK paid circulation per annum, by frequency (m) UK paid circulation year-on-year growth, by frequency (%)
1,400 1,212 4% 1,147 2.5% 1,200 63 1,068 1,022 2% 55 958 238 48 1,000 227 47 875 209 44 787 0% 197 40 800 184 2006 2007 2008 2009 2010 2011 2012 2013 176 38 -1.5% 160 -2% 600 -3.8% 911 -4% -4.6% -4.5% 400 865 810 777 729 659 -4.0% -6.1% 589 -6% -5.1% 200 -6.4% -5.8% -6.5% 0 -8% -7.8% 2007 2008 2009 2010 2011 2012 2013 -9.1% -10% -9.6% -10.7% Weekly Monthly Other -12% Other includes fortnightly, bimonthly and infrequent publications [Source: Enders Analysis based on ABC data] Weekly Monthly [Source: Enders Analysis based on ABC data]
UK consumer magazines: two-tier market opens up [2014-063] 7 Publishers cautious about price increases
• Five years since the onset of the 2008 consumer recession publishers 2008-2013 basic cover price % change 23% have remained cautious with their pricing strategies. Only mid value 25% CPI inflation titles have raised their prices above inflation and increased use of 15% 15% 10% 12% discounting has fed through to decline in consumer spend 4% 5% • Low value (<£1): This pricing category is made up of Women’s weekly and TV titles with little scope for aggressive BCP rises. Women’s titles -5% <£1 ≥£1 and <£2 ≥£2 and <£3 ≥£3 and <£4 ≥£4 Pick Me Up and Real People have both kept prices flat over five years while the small gap between effective and basic cover price reflects a 2008-2013 effective cover price % change lack of discounting by cheaper titles 25% CPI inflation 13% • Lower mid range value (≥£1 and <£2): Encompasses Celebrity, TV, 15% 11% 8% Women’s Weeklies. Paid circulation decline has been particularly harsh 3% 5% 2% for Celebrity titles, which have responded by increasing discounted copies from 7% to 38% share of paid circulation over 5 years -5% <£1 ≥£1 and <£2 ≥£2 and <£3 ≥£3 and <£4 ≥£4 • Mid range value (≥£2 and <£3): Children and teens titles have previously been able to raise prices aggressively while outperforming the market on 2008-2013 UK paid circulation % change 0% paid circulation. However price rises are now effecting circulation -10% performance; the average BCP for Children and Teens titles rose by 5% in -20% -17% -18% 2013, while paid circulation fell by 12% compared to 1% in 2012 -21% -30% -25% -29% • Upper mid range value (≥£3 and <£4): Premium Women’s lifestyle titles -40% have been able to raise prices while controlling circulation decline. This <£1 ≥£1 and <£2 ≥£2 and <£3 ≥£3 and <£4 ≥£4 has been achieved with a relatively small increase in discounting (up 2% 2008-2013 consumer spend % change since 2008). Country Home and Interiors has been able to raise its cover 0% -10% price by 50p over five years while increasing paid circulation by 14% -8% -20% -11% -16% • High value (≥£4): Resilient circulation from high value magazines has -30% -23% -23% not been matched by bold pricing -40% <£1 ≥£1 and <£2 ≥£2 and <£3 ≥£3 and <£4 ≥£4 Titles grouped based on H2 2013 prices [Source: Enders Analysis based on ABC data] UK consumer magazines: two-tier market opens up [2014-063] 8 Pricing: growth in discounting
• Not only are publishers being cautious about cover price increases, but • After a sharp decline in paid circulation in 2012 Celebrity titles magazine discounting has never been more intense than in 2013 reduced print copy losses in 2013 with the familiar palliative of discounting at the newsstand – Nearly a quarter (23.7%) of all volumes were sold at a discount • Discounted copies’ share of total newsstand sales rose from 27% to • Various methods have been adopted, but title bundling has become 39% between H1 2012 and H2 2013 particularly commonplace, as publishers push to sustain volumes across their portfolio • The increase in part rate copies was restrained compared to 2009/ 2010. In fact, Celebrity titles bucked a five year trend of accelerating revenue decline and were able to simultaneously reduce losses of consumer spend from -21% in 2012 to -9% in 2013 on the back of an average basic cover price rise of 10p
Paid circulation: full rate, part rate and free (m) Discounting at the newsstand in the Celebrity sector (000) 1,400 15% 1,263 1,261 1,229 1,2321,193 1,168 10% 1,200 1,091 1,200 105 112 131 1,048 1,046 133 984 956 5% Millions 1,000 152 903 1,000 896 199 810 187 786 0% 800 171 800 699 688 192 575 -5% 600 1,127 1,127 600 1,080 -10% 1,013 914 400 822 771 704 400 595 -15% 202 189 155 192 200 200 137 60 31 -20% 0 0 -25% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2006 H1 2007 H1 2008 H1 2009 H1 2010 H1 2011 H1 2012 H1 2013 H1
Full rate Part rate Free Part rate newsstand circulation per week Newsstand circulation year-on-year (%) Paid for magazines only; i.e. any magazine with over 50% of circulation paid for [Source: Enders Analysis based on ABC data] [Source: Enders Analysis based on ABC data]
UK consumer magazines: two-tier market opens up [2014-063] 9 Paid circulation, cover price and consumer spend
• Consumer spend in magazines fell 10% in 2013 as a result of a growth in Consumer spend (£m) and year-on-year growth (%) discounting and publishers remaining cautious about cover price 1,800 2% increases 1,598 1,592 1,486 1,600 0.9% 1,412 0% -0.4% 1,340 • All other things being equal publishers should be able to partially offset 1,400 1,251 1130 -2% volume declines with cover price increases in order to sustain or grow 1,200 1,000 -4% consumer sales revenue (this is not true of titles experiencing large -4.9% -5.1% 800 -6% volume declines) -6.7% -6.7% 600 -8% • Some titles are able to achieve this – particularly differentiated, 400 -9.6% upmarket, category-leading titles aimed at older demographics (40 200 -10% years plus) 0 -12% 2007 2008 2009 2010 2011 2012 2013 • But consumer spend in the sector as a whole is spiraling away from CPI inflation (which has been itself very low) Consumer spend (£m) Year-on-year growth (%) [Source: Enders Analysis based on ABC data]
Paid circulation, cover price and consumer spend indices (2007=100)
120 117 118 112 110 105 108 108 109 106 105 106 102 100 100 100 100 93 95 90 88 88 84 84 80 79 78 70 72 71 65 60 2007 2008 2009 2010 2011 2012 2013
UK paid circulation Consumer spend Effective average cover price CPI inflation Effective cover price = consumer spend / UK paid circulation; i.e. takes into account discounting [Source: Enders Analysis based on ABC data]
UK consumer magazines: two-tier market opens up [2014-063] 10 Best and worst performing circulations
Best performing magazine titles Worst performing magazine titles
Paid annual 5 year % Paid annual 5 year % Title Category Title Category circ.2013 change circ.2013 change The English Home Interiors 262,956 107% Zoo Men’s lifestyle 1,626,222 -79% Slimming World Women’s health 2,950,867 48% Nuts (now closed) Men’s lifestyle 2,662,105 -78% The Oldie News/ Humour 534,967 47% FHM Men’s lifestyle 845,580 -70% MoneyWeek Finance 2,687,832 45% Reader’s Digest General Interest 2,156,040 -69% Healthy for Men Men’s health 260,748 39% Love It! Women’s weeklies 5,906,308 -66% Cycling Plus Cycling 555,399 37% Match Football 1,736,950 -66% Octane Classic cars 254,991 35% New Musical Express Music 888,810 -64% BBC History Magazine History 783,130 30% Company Women’s lifestyle 1,021,332 -63% Golf World Golf 419,645 23% Computer Shopper Computing 258,600 -59% Gardens Illustrated Gardening 275,034 22% Cross Stitcher Needlework 254,332 -59% Women's Fitness Women’s health 231,355 22% Micro Mart Computing 382,959 -57% Country Homes & Interiors Interiors 920,970 14% Pick Me Up Women’s weeklies 8,616,524 -56% The Week News 7,712,826 14% Mother and Baby Parenthood 301,272 -55% Essentials Women’s lifestyle 1,291,446 10% Weekly News General Interest 1,534,832 -54% Elle Decoration Interiors 534,174 9% Digital Photo Photography 366,210 -53% Private Eye News/ Humour 5,469,048 9% PC Pro Computing 406,844 -53% Your Home Home/ Interiors 1,327,614 9% Now Women’s weeklies 10,211,968 -53% Railway Magazine Hobbies- railways 425,427 7% Psychologies Magazine Women’s lifestyle 700,141 -52%
Excludes titles with paid circulation under 250,000 copies per annum and Children/Teens titles due to high closure/launch turnover in the genre [Source: Enders Analysis based on ABC] UK consumer magazines: two-tier market opens up [2014-063] 11 Reader demographics – magazines are becoming older, more female and wealthier
• The magazine audience is steadily becoming older, wealthier and more • ABC1 consumption is declining at roughly the same rate as C2DE female consumption • The gender split is returning to the long-term trend, with the period of • However, the absolute numbers are smaller among ABC1 readers and so “lad’s mags” (FHM, Loaded, Maxim, Zoo, Nuts, and so on) appearing as a the decline has been smaller in volume terms, and titles aimed at them temporary blip on the industry’s chart are generally more attractive to advertisers, and so should remain more resilient in the medium to long term
Paid circulation by socio-demographic groups (m) and five year decline (%)
Large absolute loss but relatively resilient 400 0%
350 -10% -22% -21% 300 -25% -25% -20%
250 -35% -30% -41% 200 -40% -49% 150 -50%
100 -60% -71% 50 -70%
0 -80% Women Men Women Men Women Men Women Men Older Younger Older Younger High net worth Low net worth
2008 UK paid circulation 2013 UK paid circulation 5 year % change [Source: Enders Analysis based on NRS and ABC]
UK consumer magazines: two-tier market opens up [2014-063] 12 Magazine sector’s more stable older audience is highly attractive
• Over 45 households account for 81% of assets thanks to ownership of • Younger households have suffered through the four-year recession property and financial assets (2009-12) and the distribution of wealth has shifted to older households • Over-45s control 70% of disposable income and can spend much more • High unemployment and wage stagnation has prevented them from on ‘nice-to-haves’ accumulating wealth • Younger households are much more squeezed and reliant on credit: • Publishers need to persuade agencies and brands that magazines they account for close to 40% of expenditure and just 30% of engage these expenditure decisions – as Immediate Media has been disposable income doing with its Generation Wealth campaign
45+ households share of UK assets, income & expenditure Mean financial wealth by age of head of household (£000)
Consumer Total assets Disposable income 75 expenditure 75 72 70 61 60 50 50 49 50
45 37 29 30 81% 70% 61% 11 15 7 3 1 0 16-24 25-34 35-44 45-54 55-64 65-74 75+ Over 45 45 and under Split by age/age of head of household 2006/8 2008/10 [Source: ONS Wealth and Assets Survey] [Source: ONS Wealth and Assets Survey and Family Spending, EAL estimates]
UK consumer magazines: two-tier market opens up [2014-063 13 50+ households’ expenditure has risen by £100 billion in 10 years
• 50+ households have increased their share of expenditure to 48% in • The increased share of consumer expenditure by 50+ households has 2012 increased their shares of most categories • Families with head of household 30-49 have been dramatically • squeezed The biggest increases have taken place in restaurants & hotels and clothing and they have more than 50% of expenditure in food & drink, recreation, households goods
Expenditure by age of household % total Share of spend in households with 50+ head (% of total)
2002: £514 billion 2012: £672 billion 70% 65% 58% 60% 53% 52% 53% 48% 47% 48% 50% 47% 46% 47% 46% 11% 42% 44% 41% 39% 38% 40% 10% 40% 32%31% 30% 43% 48% 20%
47% 41% 10%
Transport Recreation Restaurants Personalcare Household Clothing Communication Education Health
0% & Food drink
& culture & & hotels &
50-and-over 30-49 Under 30 2002 2012 [Source: ONS Family Spending] [Source: ONS Family Spending]
UK consumer magazines: two-tier market opens up [2014-063] 14 Older consumers are more discerning, but not as brand loyal as often assumed
• Older households are discerning buyers and are prepared to pay • Younger people are often believed to be more footloose in their brand extra for quality relationships than older households, thus justifying higher relative • Unlike seniors, those 45-65 engage with technology – they are not spend by brands afraid of it • Consumer surveys suggest instead that older households are more • They have wider interests in the arts, in adventurous holidays, in footloose in core household spend categories unique experiences • This implies that concerted efforts by brands to reach these older households could be effective at inducing switching • The attributes of products that would need to be emphasised may of course be different
Agree with statement (% of UK demographic group) Average brand loyalty by age of principal buyer (% share of requirements) 50% 75% 69% 41% 60% 38% 38% 38% 60% 40% 34% 49% 33% 32% 33% 44% 30% 45% 39% 38% 26% 33% 30% 25% 20% 17% 16% 13%
15% 10%
0% 0% Interested in the arts Prefer to take holidays Try to keep up with Worth paying extra for Under 28 28-44 45-64 65+ off the beaten track developments in quality goods technology Alcohol Household goods Toiletries Population 45-65 ABC1 GB consumer survey [Source: TGI GB 2013 Q4] Consumer survey, year ending January 2014 [Source: Kantar Worldpanel] Consumer survey, year ending January 2014 [Source: Kantar Worldpanel]
UK consumer magazines: two-tier market opens up [2014-063] 15 Launches
• Volumes of consumer magazine launches have been steadily declining Number of magazine launches since 2005, but it is the nature of the magazines launched that is more 600 25% important 500 – New magazines are increasingly high end and niche rather than 20% mass market, so their impact on industry volumes is negligible 400 15% – In 2007 launches averaged sales volumes of nearly 3x those of today, 300 10% and there were scale launches every quarter just 10 years ago 200
– Nevertheless, 2013 was marginally better than 2012, though title 100 5% closures outnumbered launches by more than 40% 0 0% • One of the most high profile launches of the last few years has been 1993 1998 2003 2008 2013 fashion magazine Porter, published by ecommerce giant Net-a-Porter Launches Launches as share of total market (%) – Glossy, high advertising quota, considerable editorial investment, £5 [Source: Wessenden based on BRAD Insight data] price point – Porter is positioned squarely against Vogue and Elle Monthly copies sold by titles debuting with ABC (000) – Publisher distributed 150,000 copies of its first issues (and have been 4,000 3,354 merchandised expensively in store) 3,500 3,000 – Sales of 40,000 for early issues are relatively low 2,500 1,699 • However, Net-a-Porter estimates 20,000 are to consumers who 2,000 1,546 1,201 do not buy another fashion magazine 1,500 1,022 1,034 784 1,000 466 • Furthermore, the publisher also estimates that the magazine has 407 304 334 269 359 500 210 220 204 160 generated more than 20,000 purchases – for example, consumers 0 using smartphones to scan the page, and clicking items into their 2005 H2 2006 H2 2007 H2 2008 H2 2009 H2 2010 H2 2011 H2 2012 H2 2013 H2 basket – on Net-a-Porter <50,000 copies/issue ≥50,000 and <100,000 copies/issue • We return to Porter when we look at ecommerce and mobile in part two ≥100,000 and <200,000 copies/issue ≥200,000 copies/issue of our report, on digital and innovation Only actively purchased copies [Source: ABC]
UK consumer magazines: two-tier market opens up [2014-063] 16 Retail landscape
• Publishers have relied on the strong growth of supermarket metro (city and town centre) stores in the last few years to drive up availability and visibility of magazines at newsstand • This growth is now slowing, which could impact on circulations of the top sellers • However, a new supermarket war, between the established giants and discounters such as Aldi and Lidl, could see magazines distributed across still more stores in the foreseeable future – Aldi is currently rolling out an initiative in its stores • The larger risk for publishers is the potential for supermarkets to retreat from magazines – Supermarkets are attracted by the relatively high price points and the benefits of carrying magazines – they grow ARPU without taking up too much real estate, and the products carry cultural and topicality kudos – On the other hand, declining volumes will make them less attractive as a category, there is limited retailer pricing control, and the rapid growth of smartphone usage draws consumers away from magazines, diluting some of the softer benefits for supermarkets – More than half of UK consumer magazine volume sales are controlled by about 10 decision-makers. Retailer decisions tend to come in waves – when one supermarket expands (or shrinks or de-prioritises) its space, others will follow over time • Finally, magazine wholesale is feeling the squeeze, with weekly magazines contributing most to newspaper and magazine distributor challenges in 2013 – The UK is carved out by two firms – the old WH Smith News (Connect Group) and Menzies Distribution – These businesses have cost-cutting initiatives but rapid volume decline is a fundamental risk that it will be difficult for these businesses to fully mitigate against. Magazine wastage remains a huge problem – We believe the wholesale model, designed for a sector of larger scale than the one the industry is currently facing, and will certainly face in the coming years, is potentially the highest impact of all sector risks – There are solutions to these risks that would be better realised through industry discussions now, not later
UK consumer magazines: two-tier market opens up [2014-063] 17 The subscription dilemma
• If wholesale represents the largest impact industry risk, subscriptions Paid circulation year-on-year growth (%) perhaps represent the largest challenge and opportunity First year of decline 8% 5.7% 5.7% • The UK has fundamentally changed in a relatively short time-frame, 6% with an unusually non-subscription nation adopting TV, broadband and 4% 2.1% 2.5% 2% 0.9% phone subscriptions in enormous volumes -0.8% 0% • Furthermore, many corporate strategies moved into data-driven -2% -3.1% -5.1% -4% -5.3% optimisation before the internet – Tesco and BSkyB , for example -6.6% -7.3% -6% -8.1% • Unlike the US and Europe, the UK is a newsstand magazine economy -8% -10.0% -11.1% • This has been good for short-term profits, but has minimised the -10% -12% sector’s confidence in developing consumer knowledge and lifetime 2007 2008 2009 2010 2011 2012 2013 value metrics for its brands • Publishers are generally good at qualitative reader research, but much Newsstand Subscription [Source: Enders Analysis based on ABC data] poorer at precise and immediate measurement of consumption to Paid circulation per annum (m), 2013 iterate product and service improvements, and optimise ARPU 100% • The challenge is that magazines require an industry scale bias towards 4 2 0 15 3 3 22 80% 2 3 7 7 8 7 or away from subscriptions to optimise the economics of distribution 3 2 • Some solid growth in subscriptions in the middle of the last decade 60% 31 178 105 3 196 36 have not only slowed, but have reversed quite severely 40% 9 57 4 6 13 12 13 10 4 • The Week has a very effective strategy: both its print and digital 20% 2 7 subscriptions are declining, yet its combined print and digital 0% subscription is growing • The long-term implications of publishers having less knowledge about their readers than Tesco, Google, BSkyB and Facebook is the other major risk for the sector as a whole Excludes general interest, other and trade and professional Newsstand Subscription [Source: Enders Analysis based on ABC data]
UK consumer magazines: two-tier market opens up [2014-063] 18 1. Paid circulation 2. Analysis by genre 3. Advertising 4. Publisher performance
UK consumer magazines: two-tier market opens up [2014-063] 19 Paid circulation by genre
• While all consumer magazine products face the same existential Paid circulation by genre (m)
challenge posed by digital, decline varies significantly by genre 1200 41 39 • We have pinpointed the two main sources of this variation as the 59 40 1000 106 49 39 98 46 39 demographic make-up of the core readership and the extent to which 100 44 162 38 800 168 95 43 each genre’s content proposition has been replicated and added to by 164 89 38 149 79 competitors on digital platforms 242 122 600 207 185 168 107 148 • Overall market decline has been driven by Celebrity and Women’s 132 400 264 weekly titles at the heart of the newsstand; these genres have 247 240 234 227 211 accounted for 147m of paid copies lost since 2008 as a predominantly 200 275 258 low income female readership have turned to free online alternatives 246 229 207 182 0 • The 110m copies lost in the ‘other’ category are a reflection of dramatic 2008 2009 2010 2011 2012 2013 falls in the Men’s and Motoring genres, which together have lost 59m Women's weeklies TV Other Celebrity [Source: ABC] copies over five years; again in both cases precipitous decline is a result Women's lifestyle Children & teens News & Politics of online substitution from young readerships Genre five year KPIs Circulation loss Share of total loss • More worrying has been the recent acceleration of decline in what have % change 2008-2013 (m) (%) been better performing genres over the longer term, such as Women’s Other 110.3 -46% 31% Lifestyle. Titles such as Cosmopolitan have had a notable impact on the overall market, with the genre contributing 34% of subscription copy Women's weeklies 92.7 -34% 26% losses in 2013 Celebrity 54.6 -34% 15% TV 52.9 -20% 15% • News and Politics is a smaller category with a robust print demographic Women's lifestyle 26.6 -25% 7% and a high proportion of subscribers (81% compared to 17% for the overall market). Until 2013 these twin virtues allowed News and Politics Children & teens 20.4 -35% 6% titles to maintain flat circulation growth; however in 2013 the genre News & Politics 3 -7% 1% slipped into decline, down 3% year-on-year and 7% since 2008 Total Magazine Market 360.5 -31% 100% • Weaker titles in most genres are declining much faster than leading Enders ‘Other’ category constitutes 13 sub-genres: Computing, Country, Gay and lesbian, General interest, Home, Leisure, Men’s, Motoring, Music, Puzzle, Sports, Tourism, Trade and professional titles, emphasising the two-tier market within each magazine category [Source: ABC]
UK consumer magazines: two-tier market opens up [2014-063] 20 Sizing the market by genre
• Genre circulation declines in 2013 ran counter to Paid circulation market share by genre longer term patterns as Women’s Lifestyle and News 2008 2013 saw accelerating decline and previously weaker
genres, such as Celebrity, experienced relative 14% 13% 23% improvement 24% 5% 5% • However, magazine genres’ varying degrees of 4% 5% resilience to the onset of digital content consumption over the long term are best reflected by shifts in 9% 10% 17% market share over the five year period since 2008 21%
• Celebrity titles and Women’s weeklies have both lost 23% 27% share of paid circulation while the aggressive discounting strategies employed by Northern and Celebrity Children & teens News & Politics Other TV Women's lifestyle Women's weeklies
Shell and other Celebrity publishers since 2010 have [Source: Enders Analysis based on ABC data] led to a greater decrease in share of consumer spend (a 49% decline in expenditure compared to a 38% Consumer spend market share by genre decline in volumes) 2008 2013 • Television listings titles have consistently outperformed the market, and this is reflected by an 14% 15% 14% 11% increase in circulation and consumer spend share of 9% 4% for TV titles over the five year period. This is 8% 17% 15% 5% despite an acceleration in paid circulation decline in 4% 2013 stemming from Northern & Shell’s ill fated
launch of the short lived TV Pick 12% 15% 29% • While TV listing magazines have been more resilient 32% to online cannibalisation, in common with Women’s
and Celebrity titles they have been painfully slow to Celebrity Children & teens News & Politics Other TV Women's lifestyle Women's weeklies develop online products for their print brands [Source: Enders Analysis based on ABC data]
UK consumer magazines: two-tier market opens up [2014-063] 21 Core print genres are proving the slowest to build their digital audiences…
Circulation decline and online audience share by genre
20% Home/Interiors titles with controlled circulation decline and relatively high online audience share
10% Woman's Own
Woman's Weekly 13 - TV Choice 25 Beautiful Homes
0% Living etc. Country Homes & Interiors Woman BBC Easy Cook -10% OK! Chat BBC Good Food
Hello! Chat year % change, 2012 change, % year - What’s on TV Now Sainsbury’s Magazine
on Olive - Look -20% Reveal Pick Me Up TV Easy TV, Celebrity and Women’s weeklies, which together constitute 63% of the market, all have
-30% less than 25% online share of total audience Paid circulation year circulation Paid -40% Time Out- switched to free print product Sept-13
-50% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 110%
Share of all platform readership online (%) [Source: Enders Analysis based on NRS PADD and ABC] Women's weeklies Women's lifestyle TV Celebrity Other
UK consumer magazines: two-tier market opens up [2014-063] 22 Digital gains are a fraction of print losses as free online content providers cannibalise audiences
• For the H2 2013 audit period, ABC introduced a combined print and • Celebrity magazine titles have been particularly vulnerable to audience digital figure for magazines with the stated aim of providing a complete cannibalisation from free online content providers, ranging from picture of magazine brands’ audiences across platforms for advertisers newspaper brands to fast growing digital natives, most notably TMZ and Digital Spy • In reality, the combined print and digital numbers are barely distinguishable from print circulations as digital editions have delivered • There is little evidence of a coherent digital strategy from Celebrity title anaemic gr0wth and continue to be heavily outweighed by circulation publishers with titles such as Heat combining paid for downloadable pdfs losses in print. For the overall market, audited digital editions with free access to websites constituted 1.3% of paid circulation in print • While digital consumer revenues are meagre, growth prospects for • In the Celebrity genre, the five titles reporting digital editions achieved a advertising revenue online appear even more remote; leading Celebrity combined annual digital circulation of c.957,000, less than half of the titles are unable to deliver anything like enough scale to compete with print copies lost in 2013 at individual titles Reveal and Now online brands such as the MailOnline which is attracting monthly audiences more than 12 x the size of leading magazine brands
Celebrity digital copies sold vs. print copies lost (m), 2013 Multi-platform online traffic (000), May-14
2.00 9,000 8,343 9000 1.50 8,000 8000 1.00 7,000 7000 6,000 6000 0.50 0.29 0.28 0.19 0.08 0.08 5,000 4,298 5000 0.00 3,845 4,000 3,019 4000 -0.50 2,478 -1.4 3,000 3000 -1.7 -1.7 -1.00 2,000 1,3041,089 2000 -2.2 -2.2 780 666 638 1,000 563 516 361 314 271 1000 -1.50 67 0 0 -2.00 -2.50 OK! Magazine HELLO! New! Reveal Now
Annual print circulation 2013 (m) Annual digital circulation (m) [Source: ABC] Digital content provider/ newspaper brand Magazine brand [Source: comScore]
UK consumer magazines: two-tier market opens up [2014-063] 23 Discounting provides some respite for Celebrity as younger lifestyle titles suffer
• Celebrity’s moderate improvement was at odds with the rest of the Paid circulation year-on-year % change women’s market as lifestyle and weekly titles both suffered 10% accelerating print losses
5% 6% • Most notably, the rate of decline for women’s lifestyle titles doubled 4% to 11% in 2013. This was attributable in part to the closure of Easy 0% 1% Living’s print product and highlights the genre’s increasingly 2006 2007 2008 2009 2010 2011 2012 2013 -5% bifurcated performance -5% -7% ‐ Fashion and beauty titles such as Grazia and Company targeting -10% -9% -11% relatively younger audiences are feeling some pain -12% -15% -12% ‐ A cluster of domestic lifestyle and interior design titles with older (35+ years) print audiences are outperforming the rest of the -20% market with low single digit year-on-year circulation decline Celebrity Women's weeklies Women's lifestyle [Source: ABC] ‐ Living etc. and Ideal Home are two interior design titles that Women’s lifestyle sub-genres age profile and performance achieved increases in print circulation in 2013 and five year paid Good Housekeeping, -1% circulation declines of -2% and -8% compared to -25% for the 10% Ideal Home, 2% category 5% Elle Decoration, -1% Living etc, 1% 0% • NRS data shows that interior design and domestic lifestyle titles -5% attract favourable demographics and to date face a relative shortage -10% of disruptive online content, providing conditions for managed Woman and Home, -2% -15% Grazia, -15% decline -20% • Titles such as 25 Beautiful Homes and Country Homes and Interiors -25% Marie Claire, -12%
have also developed healthy online readership shares (see page 21) -30% aid circulation % aidchange, 2012/13 while Good Housekeeping has combined a stable performance in P -35% print and has a transformation strategy to come (see part two of our -40% Company, -35% 0% 20% 40% 60% 80% 100% report) % of readership 35+ Food Health Lifestyle/Fashion Parenthood Wedding Home [Source: NRS; ABC] UK consumer magazines: two-tier market opens up [2014-063] 24 Two tier market dictated by online supply
• Digital cannibalisation has been the fundamental driver of decline in Top Food and Home Interest titles paid circ., 2008-13 print and thus in content genres where online options are limited, 4000 -6% 0% circulations are holding up better -8% 3500 -11% -11% -13% -5% -10% 3000 -20% -15% • This is illustrated by the contrasting performances of the home interest/ -22% -24% 2500 -20% interior design and cooking ABC categories both of which have -31% 2000 -33% -25% -36% favourable older high income readerships according to NRS data 1500 -30% -35% 1000 -44% -40% – The food category has experienced a paid circulation decline of 25% 500 -45% since 2008 as a myriad of sites providing free online recipes and 0 -50% kitchen advice has emerged. Allrecipes.com is a global ‘online food community’ with user generated content which attracts more than 2.5m users a month. In addition to the sites attracting over 1m monthly users a long tail of blogs and YouTube channels provide a
vast range of free alternatives to cooking magazine titles Paid circ. 2008 (000) Paid circ. 2013 (000) 5 year % change [Source: ABC] – The online ecosystem for home interests and interiors has less sites Food and Home Interest sites UK traffic (000), May-14
and less traffic, only two websites/ group of websites attract more 2852 3000 2778 3000 than 1m monthly visitors, according to comScore, and one of these 2500 2079 2064 2500 1868 is the online portfolio of the House and Garden magazine titles 2000 1,787 2000 1480 1287 • A relative lack of online threats has fed into a superior circulation 1500 1047 1,021 1500 911 833 performance for home interest titles; the ABC Home interest category 1000 633 613 584 569 1000 has experienced an 11% decline in paid circulation over five years 500 500 0 0 compared to a 31% decline for the total consumer magazines market • Houzz.com, a home renovation website with a personalisation engine that links designers and contractors with consumers has recently launched in the UK and is a clear potential disruptor. However, for now interior design titles remain entrenched in the higher tier of the market as they are yet to experience the full extent of digital cannibalisation Cooking Home Interest [Source: comScore]
UK consumer magazines: two-tier market opens up [2014-063] 25 TV performance hit by Northern & Shell’s ill fated launch
• Compared to other low value magazine genres such as Celebrity, the TV TV Magazine genre KPIs genre has been notably resilient to online disruption. Between 2010 8% Consumer recession Launch of TV Pick and 2013, ABC audited TV titles maintained an annual paid circulation 6% decline of -3% and in H2 2013 Bauer Media’s weekly title TV Choice was 6% 6% 4% Britain's best-selling paid-for magazine with an average circulation per 2% 4% 4% 4% issue of 1,354,761 2%2% 1% 2% 3% 0%3% 0% 0% • The launch of TV Pick by Northern and Shell in March 2013 directly -2% -3% -3% -3% -4% targeted TV Choice’s circulation. TV Choice was forced into a damaging -4% -6% price war as Bauer lowered prices to 38p and then 20p in response to TV -6% -7%-7% Pick’s attempts to attract its readers with a cheaper alternative. -8% 2009 2010 2011 2012 2013 • TV Choice was in fact able to increase its annual paid circulation by 2.6m copies in 2013 , but the aggressive price cuts were felt the in title’s Consumer spend Paid circulation Effective Average cover price Basic cover price [Source: Enders Analysis based on ABC data] consumer revenue numbers. We estimate that RSV fell by 25% (a loss of c.£7m) in 2013 after a slight increase in 2012 Top TV Titles • The rest of the TV magazines market were reluctant to engage in price Paid % % Average Average cutting; the Radio Times, as we have observed in previous reports, is an Title circulation change change BCP 2012 BCP 2013 anomaly within the genre with an older wealthier readership and a large 2013 (m) 11/12 12/13 (£) (£) share of subscribers. In 2013 the magazine introduced a price hike of TV Choice 67.8 -4% 4% 0.45 0.39 20p; a reflection of its detachment form the rest of the TV listings What’s on TV 54.3 -2% -14% 0.51 0.53 market. At the same time, IPC Media’s What’s On TV and the smaller Radio Times 41.5 -2% -8% 1.50 1.70 low value titles continued with incremental cover price rises and as a TV Times 12.8 -6% -9% 1.23 1.28 consequence faced heavy circulation losses as readers turned to the cheaper alternatives offered by Bauer and Northern and Shell TV & Satellite Week 8.0 -3% -8% 1.40 1.45 Inside Soap 7.2 -3% -7% 1.55 1.60 • We estimate that the enforced price cuts and copies lost to the launch of TV Pick cost the incumbent titles in the TV listings market TV Easy 6.0 -3% -23% 0.51 0.53 approximately £12m in revenues as consumer spend declined -7% in Total TV Guide 5.6 3% -11% 1.10 1.10 2013 compared to a 3% increase in 2012 [Source: Enders Analysis based on ABC data] UK consumer magazines: two-tier market opens up [2014-063] 26 Free and branded magazines
• Retail and brand magazines have exploded in recent years, though ABC • On the consumer side, Stylist is by far the most important consumer records a substantial erosion since 2007 magazine launch (paid or free) in the UK of the last five years; and the relaunched free Time Out accounts for the lion’s share of volume growth • Certainly, when BSkyB retreated in 2011 it had a huge impact on in the free consumer category in 2013 volumes • Stylist has secured a strong platform of brand and retailer advertising for • But retailers are creating print products with in-house and commissioned its confident and authoritative content, a substantial challenge for a content, extensions of their increasingly heterogeneous marketing range of magazines including weekend newspaper supplements activities, and they may not be as obsessed about the definitions and methodology of magazines as the contract suppliers and editors of them • Time Out has also attracted brand advertising for its content, which has not just been stripped down to lead readers to its Apps and website for • These magazines matter to traditional publishers as they are not just listings and bookings, but has adopted a much more accessible tone for catalogues, with titles such as John Lewis’ Edition entering the living many demographics room, and therefore competing directly for consumer attention and within the product discovery funnel
Number of free titles reporting ABCs in December 2013 A range of branded title circulations (000s)
120 2500 1983 1936 101 2000 100 18 84 84 1500 1334 1215 77 76 76 78 80 18 20 1000 659 555 498 450 32 21 20 20 20 361 292 60 500 174 27 24 17 0 22 17 18 40
51 20 39 34 40 39 38 41
0 2007 2008 2009 2010 2011 2012 2013 Supermarket Insurance company (pets & health) Department Store Airline Auto Ecommerce fashion Consumer Own brand Societies and bodies [Source: Enders Analysis based on ABC data] [Source: Enders Analysis based on ABC]
UK consumer magazines: two-tier market opens up [2014-063] 27 Retailers up their publishing commitment
• Publishers are on a journey towards retail, but ecommerce is a high-risk, expensive business model, while for retailers the journey to publishing is low-risk and pushes them up the discovery funnel • In 2007, ASOS diverted advertising spend in fashion magazines into its own monthly ASOS magazine. • Since then, circulation leapt from 100,000 at launch to 449,860 in December 2013; the page count has almost doubled • Advertising revenue from the magazine and the website was £3.6m in FY2013 (year ending August), up 414% on 2007 (£0.7m) • As with traditional publishers, ASOS launched on iPad with limited success, averaging a further 11,000 downloads per issue (7,000 women’s and 4,000 men’s) as reported in the company’s 2012 results • Net-a-Porter launched Porter in 2014, distributing 150,000 copies a month and selling about 40,000 • The title is unashamedly traditional and upmarket – it competes head-on with Vogue, Elle and so on • It is £5, glossy and carries a lot of advertising; and the investment in editorial is considerable • The publisher has estimated half of its audience is new to the sector, so overall cannibalisation is probably quite minimal, but it has also estimated that 20k transactions have been generated – Key to this has been the use of mobile to place products direct from the page into the Net-a- Porter basket • Traditional retailers, such as John Lewis and Marks & Spencer have long been committed to magazines, but their commitment seems to be growing – This is in part because they recognise that digital is poor at discovery
UK consumer magazines: two-tier market opens up [2014-063] 28 1. Paid circulation 2. Analysis by genre 3. Advertising 4. Publisher performance
UK consumer magazines: two-tier market opens up [2014-063] 29 Advertising expenditure declining gently
• Magazine advertising continues to fall, but it is holding up better than Consumer magazines display advertiser spend (£m) newspapers, with advertising spend per copy being relatively steady 570 (albeit falling in real terms) 544 600 517 79 82 • Digital advertising accounted for 18% of magazine adspend in 2013. 92 National newspapers generated about £173m in advertising last year, 400 about 13% of their total adspend 665 655 619 486 506 491 463 • In B2B magazines (not shown) digital advertising represents 28% of 200 426 total adspend 0 • There are significant risks that decline in adspend could fall much more 2006 2007 2008 2009 2010 2011 2012 2013 quickly than circulation, but our near-term hypothesis is that the Print Digital relatively strong economy will help minimise decline, as will the rapid Our estimates for 2011 and 2012 classified advertising expenditure differ from WARC; we growth of mobile and video formats suspect a steeper fall than WARC reported based on companies reported data [Source: Enders Analysis based on AA/WARC data] Consumer magazines print display spend per copy (£) £1.20
£1.00
£0.80
£0.60
£0.40
£0.20
£0.00 1988 1993 1998 2003 2008 2013
Consumer spend per copy Advertiser spend per copy [Source: Enders Analysis based on ABC and WARC data]
UK consumer magazines: two-tier market opens up [2014-063] 30 Approximate scale of key categories
• Share of paid circulation has remained largely flat year-on-year as TV, • The key to lifestyle and fashion revenues lies in advertising and context Women’s Weeklies and Celebrity continue to dominate consumer rather than scale; Nielsen data shows almost 1/3 of display advertising volumes, accounting for over 60% of total copies sold spend on magazines is on clothing/accessories and cosmetics/personal care. Spend for these product categories is likewise heavily weighted • However, while TV, Celebrity and Women’s Weeklies have large audience towards premium lifestyle and fashion titles with affluent readerships scale, weaker context and lower income readerships are less appealing to advertisers • These two categories maintained a 15% share of spend in total press advertising in 2013 and we believe that within press, their share of spend • In contrast women’s lifestyle and fashion titles continued to punch above on consumer magazines will have increased, thus fractionally increasing their weight in revenue terms in 2013. Despite an accelerating fall in sales lifestyle and fashion’s share of total magazine sector revenues in 2013 volumes this genre’s share of paid circulation was relatively unaffected, reduced by basis points rather than per cent • In advertising, as with circulation, the two-tier market is opening still further
Share of print paid circulation volume (%), 2013 Share of print value (%), 2013
10% 19%
Women's lifestyle and fashion Women's lifestyle and fashion TV TV Women's weeklies Women's weeklies Celebrity Celebrity Children & teens Children & teens News News Leisure Leisure Home Home Other Other
Value is consumer and advertiser spend [Source: Enders Analysis estimates based on ABC] [Source: Enders Analysis estimates based on ABC and AA/WARC data]
UK consumer magazines: two-tier market opens up [2014-063] 31 Advertising forecasts
• As identified above magazine advertising has been relatively steady, and • We believe there will be more rapid deterioration further out, as the the contribution from digital has been relatively high perceived relevance of print declines further, exacerbated by market over-supply • Digital advertising represents 13% of national newspaper advertising but 18% of consumer magazine advertising and 28% of B2B magazine • In B2B magazines, a relatively buoyant economy and recruitment advertising market should marginally slow the underlying rate of decline of business advertising – but we suspect only temporarily • We believe the economy will slow decline in print advertising from 8% last year to about 6% this year, but that the rate of decline will start to • Digital advertising should keep growth at mid to high single digits, with accelerate again some upside potential if video and mobile innovations are deployed more aggressively than we have assumed. Digital in B2B is at a more • However, this assumes luxury fashion and beauty remain robust (if they mature stage, though again business video marketing could provide were to turn, the outcome could be significantly weaker) and also some upside to our outlook assumes a very strong autumn, as H1 has been much poorer than this
Magazine display advertising expenditure forecasts 2012 2013f 2014f 2015f 2016f 2017f Advertising expenditure (£m) Consumer magazines print 463 426 400 372 338 305 Consumer magazines digital 82 92 100 110 118 126 Business magazines print 262 236 217 199 175 154 Business magazines digital 94 94 98 103 108 111 Total magazines display 900 847 814 784 739 696 Advertising expenditure year-on-year growth (%) Consumer magazines print -6% -8% -6% -7% -9% -10% Consumer magazines digital 3% 12% 9% 10% 8% 6% Business magazines print -17% -10% -8% -8% -12% -12% Business magazines digital -2% 0% 4% 5% 5% 3% Total magazines display -8% -6% -4% -4% -6% -6%
[Source: Enders Analysis based on ABC and AA/WARC data]
UK consumer magazines: two-tier market opens up [2014-063] 32 1. Paid circulation 2. Analysis by genre 3. Advertising 4. Publisher performance
UK consumer magazines: two-tier market opens up [2014-063] 33 Publisher confidence, revenue and profitability
• In 2012, fewer and fewer publishers were reporting profits, as the market Breakdown of publisher revenue (%) began to polarise between the big publishers and the small ones, and the 100% early signs of the “two tier” magazine market emerged 5.3 10.5 – The anticipated recovery in revenue since the recession in 2008 failed 4 90% to materialise, and consumer spending remained constrained 6.5 17.6 • 2013 has seen a slight improvement, with consumer magazine publisher 80% confidence beginning to be restored. The underlying problems have not dissipated but restructuring has meant that profitability, for many 70% publishers, has stabilised and is expected to grow into 2014 30
• Digital now accounts for 17.6% of publisher revenues in 2014 60% - The internet and its possibilities still remain something of a 35.7 hypothetical component for many small publishers 50% • Nevertheless, consumer magazine publishers will derive 53% of their revenue from print copy sales and print ad sales in 2016, down from 73% 40% 27.2 in 2014, and nearly a third from digital activities*
- It is in publishers’ interests to allocate as much revenue to digital as 30% Print revenue Print possible (it’s a positive message to investors and to the advertising 20% supply chain, and it helps justify expensive digital investments) 37.4
- Many revenue opportunities (for example, creative marketing 25.8 solutions for major advertising brands) involve print and digital 10% activities and we suspect there are some tactical allocation decisions at some publishers utilised to realise these revenue splits 0% 2014 2016e
Copy sales Print ad sales Digital Customer publishing Other *Wessenden/PPA, Publishing Futures 2013 and 2014 [Source: Wessenden/PPA, Publishing Futures 2013]
UK consumer magazines: two-tier market opens up [2014-063] 34 Publisher performance
Magazine publishers: cover price, growth in UK paid circulation and UK consumer spend, 2013
20%
10%
Dennis
year growth, 2012/13 growth, year 0%
-
on - Bauer
DC Thomson Dennis -10% Immediate Haymarket Future
Northern and Shell IPC Hearst
UK paid circulation year UK paidcirculation Loss of 1.8m copies -20% Condé Nast from closure of Easy Living print product Loss of 800,000 copies from sale of Classic Rock and Future Metal Hammer music titles to Team Rock ltd -30% £0.00 £1.00 £2.00 £3.00 £4.00 £5.00 £6.00
Average basic cover price, 2013 [Source: ABC]
UK consumer magazines: two-tier market opens up [2014-063] 35 Publisher key performance indicators
Top consumer magazine publishers: key operating metrics for 2013 UK annual UK annual Year-on-year UK annual paid Year-on-year Year-on-year Number of UK consumer spend circulation (m) change circulation (m) change change subscribers (£m) IPC Media 203.4 -11% 200.1 -11% 223.1 -10% 687,721
Bauer Media 209.3 -6% 207.3 -6% 216.4 -10% 582,679
Immediate Media 71.5 -9% 70.8 -9% 144.0 -2% 909,735
Hearst Magazines UK 62.7 -11% 61.1 -12% 101.7 -10% 744,665
Northern & Shell 47.6 -9% 47.3 -9% 187.2 -1% 8,009
DC Thomson 26.3 -4% 26.3 -4% 38.5 -6% 77,011
Dennis Publishing 19.6 -4% 17.7 -7% 38.7 -4% 380,339
Condé Nast 12.1* -16% (-5%) 10.0 -20% (-7%) 24.2 -21% (-10%) 266,026
Future Media 10.0 -16% 7.0 -25% 29.9 -25% 196,147
Haymarket 7.5 -12% 7.4 -10% 24.4 -9% 164,676
*1.8 m copies lost from closure of Easy Living print product. Numbers in brackets are like-for-like i.e. exclude impact of lost Easy Living copies Data will differ from wholesaler data because this data includes subscriptions and not all titles for which wholesalers report data report ABCs. Number of UK subscribers is the sum of single copy subscription sales per issue for all titles owned by that publisher; if a person subscribes to two titles owned by the same publisher, they will be double counted. IPC incl. European Magazines Limited (publisher of Marie Claire) and Evarn Ltd (publisher of Look); Bauer incl. H Bauer; Hearst includes Hearst Rodale; DC Thomson incl. Puzzler; Future incl. Future Plus (contract publisher). [Source: Enders Analysis based on ABC]
UK consumer magazines: two-tier market opens up [2014-063] 36 Disclaimer
About Enders Analysis
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