Sunday, June 24, 2007

What Circulation Taught Me

"If once you forfeit the confidence of your fellow-citizens, you can never regain their respect and esteem."
Abraham Lincoln (American 16th US President (1861-65), who brought about the emancipation of the slaves. 1809-1865)

John Griffin
President, National Geographic Magazine Group
What Circulation Taught Me

Circulation Management Conference & Expo

As a former circ nerd, there are few things more beautiful to me than a 50% sell through or an 85% renewal rate, but now that I am the president of National Geographic Magazines I am inspired by other sights as well . . .

It is a privilege to lead this great brand in all disciplines but I will always love the creativity, clarity and detail of circulation. My circulation trainings has influenced how I think about managing national geographic magazines in the 21st century and how I see my responsibilities on the ABC and MAP boards.

What circulation taught me

In 1979 when I was made circulation director of PVN (cir 1,900,000) my prior publishing experience had been as an editor. In my most recent job at the exceptional parent magazine, In addition to being managing editor I also managed its circulation of 20,000. What maniac would hire a person who never seen a spreadsheet, never mailed a direct mail package, and thought of himself as an editor to be the circulation director of a magazine with 1,900,000 circualtion? Bob Teufel, the first of my three great teachers.

Bob taught people at Rodale to:

respect your customers
respect and learn from coworkers and competitors
be creative and aggressive
and that the only test you will regret is the one you don't do
Bob himself had moved from circulaton director to president, so he knew that more important than formal training is an aptitude for math and for marketing, a respect for people and brands and an enthusiams to learn and test.

Bob had the rodale circulation department work with a consultant named Gordon Grossman-Gordon had been the circulation director and more at the reader's digest where he had introduced the sweepstakes, regression analysis and led the transition of circulation from the creative age to the computer age. Gordon taught us how to think not only about circulation but about business:

leave no idea unchallenged
good decisions are impossible if you don't understand the numbers in aggregate and in detail
and that when you find success be aggressive in capitalizing on it.
Teufel also put me in charge of single copy sales which Rodale at the time did none of. Having no idea how single copy sales worked, I went to a conference where Mike Andrews spoke. Mike was a retail consultant who had been the circulation director of The New Yorker and then had launched penthouse in the us. As Mike would say I went from class to --.

Mike taught me that the retail business was:

a business of detail
of finding what works in one town or even one retailer and then aggressively duplicating that success in other towns and in similar retailers.
And in those days with over 400 wholesalers, 400 separate experiments in your magazine's distribution, it was almost always possible to find something to build on. While the distribution system has consolidated and changed these principals still hold.

These three people and an amazing group of executives-Pat Corpora, Bob Reinhart, Ed Fones, Barb Newton, Joyce Shirer, Rich Alleger and now Terry Day-and suppliers-especially Bob Castardi at Curtis-reinforced these lessons and taught me many new ones.

Some of the things I learned as a circulator:

editorial leads
the importance of positioning
sell benefits
substance, quality and leadership sell
live in a fact based world
understand that patterns and trends matter
make numbers pass the common sense test
too much data is as bad as too little data; act now
aggressively follow up on success
pay attention to you two major cost centers: circulation expense and production expense
good ideas can come from anywhere
as a person who came up through the circulation side of publishing, I have a strong point of view about the current state of our business that I bring to my roles on the board of ABC and MPA.
The future and the abc

In our business we are dealing with new media, recent circulation scandals, new abc rules and circulation categories, and changing reader and advertiser expectations and demands. I'll start by describing the world as I see it.

Magazines suffer from troubles of their own making
Because of the poor circulation practices of the recent past- especially the practice of counting unpaid circualtion as paid-magazines have a credibility problem with the advertising community. While the creation of the verified category has brought more transparency to the abc statement, we still spend a stupid amount of time dealing with the past instead of building for the future.

Importance of advertising revenue increases
It is likely that advertising revenue will remain the primary source of revenue for magazines and probable that, for large magazines, it will increase as a percentage of total revenue, especially as we are able to increase our sale of on-line advertising and other kinds of parnerships that our strong brands can bring to advertisers.

Comparability a necessity
While advertiser's enthusiam for micro targeting and response based advertsing evaluation may wane, the demand for

greater comparability between media and
accountability for achieving advertising goals will remain or grow.
Demand for speed
advertisers will want to buy advertising as late as possible and evaluate effectiveness as soon as possible after an ad runs-the demand for speed will only increase. Magazines will always be at a disadvantage but we must minimize that disadvantage. Sometimes we speak only as a print magazine owner, other times as a multi-media brand owner. In this case print magazines may be at a disadvantage but online magazines brands will not be.

In face of these challenges,

What is a consumer marketer to do?

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 to audience measurement and possibly to combined measurement of web and print audience. If we don't change, then magazines will be comparable only to themselves. This will not happen, so prepare to have your work judged on audience size and quality as we have traditionally been focused on paid circulation and distribution.

It will take some time to create accurate, stable, and fast issue by issue audience measurement. But we can deliver transpaprent distribution data faster with tools we have at hand-verified circualtion for transparency and rapid report for speed.

I challenge us all to make distribution completely transparent-to put all sources that leave the possibility of abuse into verified and to report distribution early through rapid report. If we do this we can hopefully regain the confidence of buyers by putting 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. If you really think penny sold distribution has greater value than free public place distribution, argue it in the sales process, 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 advertising.

What we don't need is more abc rules. What we do need is transparency on distribution and faster reporting while concurrently moving to fast audience measurement.

So lets drop the smoke and mirrors and enjoy the process of creating great editorial material that provides a positive environment for advertsiers and put it in front of the people who want it and need it in print or digitally or however they want it.

And if all this sounds hard and like a big pain, just remember you could be working in a chinese chicken factory.

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