Tuesday, July 17, 2007

RD to Sell Back Cover, Cuts Circ 20%

RD to Sell Back Cover, Cuts Circ 20%
BY Lucia Moses

Reader's Digest has revealed that in addition to whacking its rate base by 2 million to 8 million starting in January, it would for the first time regularly sell ads on its back cover. The back cover has carried various forms of art over the years, including the work of Norman Rockwell-style Cincinnati illustrator C.F. Paine that's appeared in every issue since 2003.

"We have done extensive research in-house," said Eva Dillon, president and group publisher, Reader's Digest, one of a number of outside executives that new RDA CEO and longtime pal Mary Berner brought in following a private equity-led buyout earlier this year. "Readers don't seem to care one way or another. We thought readers would have a strong negative reaction. Once we saw that they didn't, we said, 'Hey, what are we waiting for?'"

The sale of the back cover will coincide with a planned redesign under editor Jackie Leo, and Payne's work will continue to run in the magazine, Dillon said. "He's an incredibly important artist, and his art will be part of the redesign," she said.

The decision will likely be well-received by marketers, as advertisers have long clamored to run ads on the coveted back cover position. "A lot of our longstanding advertisers have been asking every year," Dillon said. "There will definitely be a premium on it because so many people want it."

The sweeping changes at the Readers Digest Association flagship are among others planned by Berner. Having shaken up the executive ranks, she also plans to step up sales across RDA titles and pursue more advertising opportunities around food magazine Taste of Home and its brand extensions (the company doesn't plan to break with practice of not accepting display print ads in the title).

At the future rate base of 8 million, Reader's Digest's guaranteed circ will stand at nearly half the 15-million level it was in 1999, when it began a series of rate base cuts. Indeed, cost of paper, postage, clutter at the newsstand and advertiser demand for more loyal readers have led other giants like Time magazine, TV Guide and Playboy to right-size their rate bases in recent years. A move once pounced on by media buyers as a sign of weakness, a rate base cut is more often applauded as a necessary move that results in higher-quality circulation.

Dillon said the rate base cut at Reader's Digest would save costs while responding to advertiser demand for more loyal circulation. Reader's Digest will whittle the rate base by shifting spending on direct mail to online, which it hopes to build on what is today a small subscription source and attract younger readers in the process.

"This is a very broad magazine for 35-plus," Dillon said. "We know that we need to shift some of our focus to younger readers."

The magazine, the second-biggest by circulation after AARP the Magazine, per the Audit Bureau of Circulations, has tried to court younger readers over the years, but boomers remain its sweet spot. Median adult reader age stands at 51.7, per the Spring MRI.

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