MAGAZINE PUBLISHING FROM PRINT TO DIGITAL: STRATEGY FOR AN INDUSTRY INTRANSITION

Transcription

1 MAGAZINE PUBLISHING FROM PRINT TO DIGITAL: STRATEGY FOR AN INDUSTRY INTRANSITION Thomas R Troland TRT Advisory Session #3 October 20, 2014

2 US DIGITAL MARKETING FORECAST

3 TECHNOLOGY is miraculous because it allows us to do more with less, ratcheting up our fundamental capabilities to a higher level. --Peter Thiel Founder of PayPal 3

4 Digital will soon reach half of all time spent on media [in China], up from just a third of time spent two years ago. --Zenith Optimedia September

5 DEFINING THE PROBLEM OF PRINT 3. BUSINESS MODELS ARE CHALLENGED AND CHANGED 1. DIGITAL REPLACES PHYSICAL 2. CONSUMERS ADOPT AND ADJUST 5

6 1. DIGITAL REPLACES PHYSICAL 6

7 2. CONSUMERS ADOPT AND ADJUST Source: Market RaDaR Analysis Forrester Research introduce_ the_ marketing_ radar_ to_ china 7

8 3. PRINT BUSINESS MODEL IS CHALLENGED Creative Manufacturing Distribution Management Single Copies Subscriptions Ad Sales 8

9 DIGITAL S GROWING DOMINANCE: NEARLY HALF OF CONTENT SPENDINGWILL BE FOR DIGITAL PRODUCTS BY

10 WHAT MAKES A STRONG MAGAZINES MARKET? URBAN AFFLUENT & ASPIRING MOBILE 10

11 CHINA GROWS IN URBAN POPULATION 11

12 AFFLUENCE RISINGWITH URBAN GROWTH Source: Women Power Money #% / July 2013 Ipsos CT / Hearst Magazines / Fleisjman Hillard 12

13 CHINA: WORLD S MOST MOBILE POPULATION 13

14 UT

15 CHINA ADOPTS AND ADJUSTS TO DIGITAL TECHNOLOGY AT AVERY FAST PACE 15

16 MOBILE DEVICES PROLIFERATE IN CHINA 95% Own a Cellphone 37% Own a SmartPhone 69% Age Own a SmartPhone Source: Pew Research Center, February

17 TRADITIONAL MEDIA ARE LOSING ATTENTION 17

18 ADVERTISERS MOVE TO DIGITAL 400, ,000 RMB (Millions s) 300, , , , ,000 50,000 - September 2014 * Forecast * 2015* 2016* Advertising Expenditures in China by Medium Internet et Outdoor Cinema Radio Television Magazines Newspapers 18

19 INEVITABLE SHIFT 19

20 MCLUHAN S LAW OF MEDIA DISRUPTION A new medium is never an addition to an old one, nor does it leave the old one in peace. It never ceases to oppress the older media until it finds new shapes and positions for them. Marshall McLuhan,

21 THE MAGAZINE MODEL (SIMPLIFIED) Create Manufacture Distribute 21

22 TEN BIGGEST US MAGAZINES: DEGREE OF TRANSITION TO DIGITAL PLATFORMS 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Video Mobile Web Web / Desktop -Laptop p Print / Digital Editions Source: AMM 360 September 2014 Adult Readers of Magazine Brands by Platform 22

23 BETTER HOMES AND GARDENS: THE BUSINESS OF CONSUMER COMMITMENT SUPPORT 7.6 million circulation 39 million adult readers 23

24 BH&G: BRANDING MODEL 24

25 TOP US MAGAZINE BRANDS FOR ACCESS BY DIGITAL MEDIA 90% 85.4% 83.6% 82.8% 81.7% 81.5% 80% 76.9% 70% 67.7% 60% 61.9% 59.4% 57.4% 56.6% 50% 52.6% 50.5% 46.3% 45.9% 40% 30% 20% 10% 0% 25 Share of Total Readers Accessing Brand on Digital Platforms Source: AMM 360 September 2014

26 ACOMPANYA BUILDING ITS DIGITAL FUTURE 26

27 BETTER HOMESAND GARDENS AND ALLRECIPES: CONTRAST IN MODELS 100% 90% 80% 70% (000) 60% 50% 40% 30% 20% 10% Video Mobile Web Web / Desktop -Laptop p Print / Digital Editions Source: AMM 360 September % BH&G Allrecipes Adult Readers of Magazine Brands by Platform 27

28 AMAGAZINEA FORTHE DIGITAL ERA Reader Contributors 900, Circulation 17 Million Mobile Users 28

29 STRATEGY FOR MAGAZINES INTHE DIGITAL DOMINANT MEDIAWORLD 1. Know the job the customer is hiring you to do 2. See your magazine as a brand not a product 3. Extend and Experiment 4. Be in love with what you do 5. Don t be in love with how you do it 29

30 THANKYOU! Thomas R Troland TRT Advisory Tttroland@verizon.netnet 20 October 2014

31 Getting the reliable insight you need. UNDERSTANDING MEDIA IN CHINA: PREVIEW Datamonitor We Are Social Ericsson McKinsey Zenith Optimedia Boston Consulting Group Ipsos Nielsen 31