Magazine Industry Confronts a Challenging Yet Hopeful Future

As the magazine industry gathers this week in Chicago under the new moniker MPA – The Association of Magazine Media, (http://www.magazine.org/) the focus is on restructuring and refocusing to address a stark economic reality: print-only consumer magazine advertising spending, which declined more than 15% between 2000 and 2010, is projected to decline at least another 10% to 20% by 2020. However, new data being developed by Jack Myers Media Business Report reflects a radically different magazine industry outlook, projecting thatmulti-platformconsumer magazine ad spending will increase by more than 40% by 2020. This new data offers corporate management gathering this week at the American Magazine Conference a radically different perspective on their industry's growth prospects.

The traditional print magazine is being extended to:

· embrace both print and video content;

· provide well-organized, editorially curated and easily accessible online and mobile intelligence, insights and information about specific categories of interest;

· deliver environments that enable marketers to integrate their advertising, promotional, direct marketing, experiential and social strategies;

· offer print and digital editorial showcases for marketers in specific product and service categories.

But magazines that remain dependent on mass circulation and traditional advertising models will be locked into a downward pricing spiral in both their advertising and subscription business, requiring them to grow their rate base and reduce their ad rates – a costly and unsustainable model for all but a few.

Only a few of the thousands of print-based media companies that are now dependent almost exclusively on ad and subscription revenues will survive intact to 2020 without making substantial changes to their core businesses. In 2020, traditional advertising is projected to command only 15% to 20% of total marketing budgets, compared to 30% in 2007 and 70% in 1963.

Advertising, by traditional definition, is a one-way communications technique for distributing commercial messages to audiences via multiple media options. In 2010, traditional advertising investments in media will total only an estimated $180 billion, according to Jack MyersMedia Business Report. Non-traditional marketing budgets will total nearly $500 billion. By 2020, marketers will be actively investing 80% to 90% of their projected $1 trillion in communications budgets in a direct consumer activation process -- using coupons, incentives, direct marketing, point-of-purchase, experiential, social and other non-advertising marketing tools, much of it in association with media properties.

It is a business imperative that traditional magazine companies invest in the human and technological resources to become an active participant in this marketplace.

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