Saturday, June 09, 2007

National Geographic's John Griffin: Magazines Suffer From Troubles of their Own Making

"The secret of life is honesty and fair dealing.
If you can fake that, you've got it made."
Groucho Marx (American Comedian, Actor and Singer, 1890-1977)

National Geographic's John Griffin: Magazines Suffer From Troubles of their Own Making
By Tony Silber

In a ringing call for greater circulation transparency and rapid acceptance of two key Audit Bureau of Circulations initiatives, National Geographic Magazine Group president John Griffin Tuesday challenged magazine publishers to put "the discussion of value where it belongs-in the negotiation between buyer and seller-and take it away from the ABC board and off the front page of Ad Age."

Speaking as a keynote at the Circulation Management Conference & Expo in New York, Griffin said publishers have been spending a "stupid" amount of time dealing with the past instead of building for the future. "Because of the poor circulation practices of the past, especially the practice of counting unpaid circulation as paid, magazines have a credibility problem with the advertising community," he said. "I challenge all of us to make distribution completely transparent-to put all the sources that leave the possibility of abuse into the Verified category and to report early through Rapid Report."

Both of these initiatives were created in the last 18 months and intended to create more clarity in magazine circulation. Verified, which took effect with the audit statements ended in June 2006, allows publishers to classify non-paid circulation clearly. It covers public-place distribution and free copies intended for individual use, and was a reaction to a series of scandals where magazines over-reported paid circ. Rapid Report-adopted a year ago-allows publishers to voluntarily report their top-line circulation data on an issue-by-issue basis within weeks of the on-sale or non-paid distribution date. Acceptance of both techniques has been spotty, as publishers and advertisers both cling to the higher perceived value of circulation that can be classified as paid-even if it is sold at deep discounts.

"If you really think penny sold distribution has greater value than free-public-place distribution, argue it in the sales process," Griffin told about 250 attendees. "But don't keep categories on the ABC statement that allow for abuse and an industry focus on the minutia of distribution and not the effectiveness of advertising."

"What we don't need is more ABC Rules," Griffin added. "What we do need is transparency on distribution and faster reporting while concurrently moving to fast audience measurement."

Griffin summarized the challenge for publishers in this way:

Advertising will remain the primary source of revenue, and for large magazines, it will increase as a percentage of total revenue, as publishers are able to increase sales of digital advertising.

The demand for greater comparability between media and accountability for achieving advertising goals will continue to grow.

The demand for reporting speed will remain as advertisers buy as late as possible and evaluate effectiveness as soon as possible after an ad runs. This will always be a disadvantage for magazines, but it must be minimized. Online magazine brands will play a role here because they will not have that disadvantage.

Distribution and paid circulation are measures that have nothing to do with the effectiveness of an ad. And they are comparable to no other media.

Even newspapers are beginning to move toward audience measurement, and possibly the combined measurement of Web and print audiences. If the magazine industry doesn't change, then magazines will be comparable only to themselves. This will not happen, so audience developers need to prepare now to have their work judged on audience size and quality.

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