Audited Publication Drop Causes Consumer Magazine Circulation Nosedive

Circ decline in the first half of 2009 may be the steepest in 40 years.

By Baird Davis
Monday, October 5, 2009

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In the second half of 2000 paid and verified circulation of audited consumer magazines peaked at 312 million. In the succeeding eight-year period (until 2008), the industry’s circulation of audited publications fell 11.5 percent, a gentle 1.5 percent annually. But in the first half of this year the circulation of audited consumer magazines came crashing down, led by a sharp decline in the number of audited consumer magazines. The level fell from 273.8 million in the first half of 2008 to 256.5 million—a 6.3 percent decline. Although my records only go back ten years I believe this is the steepest consumer magazine circ decline in over 40 years.

Before I proceed with a discussion of the factors underlying this steep decline, I want to clarify the derivation of the data I’ve used in this report. This analysis is confined to only ABC and BPA audited paid/verified circ “consumer publications” with more than 5,000 paid circulation. It doesn’t include audited publications (i.e., AARP Magazine, American Legion Magazine, Elks Magazine) that derive their circulation primarily from “association,” “verified” or “paid sponsored” circulation.

By combining the so-called “association” publications with what most industry observers consider consumer magazines (those whose circ is derived primarily from individually sold subscriptions and single copy sales) the audit bureaus have, in my opinion, mixed under a consumer magazine umbrella a non-homogeneous group of publications.

This has made it much more difficult to understand the circulation dynamics of the rapidly changing consumer magazine market. It’s an important distinction and the reason I have been separating audited “consumer” and “association” publications in my industry analysis pieces for the last ten years.

Observations: First-Half 2009 Consumer Magazine Circulation

• Total Paid/Verified Circ went from 273.8 million to 256.5 million, down 6.3 percent or 17.3 million.

• Paid/Verified Subscription Circ dropped from 228.3 million to 219.5 million, down 3.9 percent or 8.8 million.

• Verified Circ fell from 13.9 to 11.4 million, down 18.0 percent or 2.5 million.

• Use of Partnership, Paid Sponsored and Award Circ sources (reported in paragraph six of ABC Statements) far exceeds the decline in verified circ. Verified circ usage was down, but based on an analysis of the top 25 circulation companies, it’s been determined that the industry’s use of partnership, paid sponsor and award circ sources rose over 20 percent. Their combined increase is estimated to be more than a million circ more than the 2.5 million decrease in verified circ.

• Newsstand Circ dropped from 45.5 million to 37.0 million—down a gigantic 18.7 percent, or 8.5 million. Note that newsstand circ, although less than 15 percent of total circ, decreased nearly equally to the 8.8 million subscription circ decrease.

• Newsstand Circ as percentage of total paid/verified circ, precipitously fell from 16.6 percent to 14.4 percent. This is a serious concern considering that in the year 2000 the newsstand circ ratio was 20.7%.

• Departing titles far exceed newly audited titles. A record 69 titles were discontinued or ceased being audited and only 23 titles were added to the audited ranks. The total number of audited “consumer magazines” fell from 545 a year ago to 499.

• The 23 new titles accounted for 5.1 million paid circ. The 69 departing titles accounted for 16.2 million paid circ. Their net “lost” circulation was 11.1 million, which accounted for a major portion of the industry’s 17.3 million circ decline.

• Many more publishers decreased circ levels. 183 publications decreased circ 5 percent or more compared to 142 a year ago and 101 the year previous. Conversely only 41 publications increased circ five percent or more compared to 76 the year previous.

• Major circ level decreases exceed increases. 36 publications decreased circ levels 50,000 or more accounting for 5.1 million circ. Only 16 titles increased circ by 50,000 or more accounting for 2.0 million circ. The circ decrease differential for this group of titles was 3.1 million.

• “Association” circ publications, the number of audited “association” titles, remained steady at 100. But the aggregate paid circulation of this group of publications grew to 152 million, up nearly 13 percent from 135 million in the year previous period. The “association” publication share of what the audit bureaus classify as the consumer magazine circ market rose to 37 percent, up dramatically from 24 percent in the year 2000.

Circ Levels Decline, But Are They Still Too High?

It took a major recession and a dramatic change in the media landscape, but it appears, based on the industry’s current circ decline, that publishers are finally loosening their grip on antiquated advertising-driven circulation philosophies and are being quicker to discontinue unprofitable publications. In the process, the universe of audited consumer paid circulation titles has become much more exclusive.

However, there are still signs that the industry’s circ levels are too high. One is the rapidly accelerating decline of newsstand circ as a percentage of total paid circulation and another is the rising use of paragraph 6 circ sources, especially partnership circ which grew an estimated 35 percent last year and now exceeds verified as a circ source for consumer magazines.

And let’s not forget “association” publications. Their circ growth, in the face of declining consumer magazine circ, is a reminder of their ever-growing threat for the attention of consumers that are faced with an expanding medley of media options.

The consumer magazine industry has taken some major steps at correcting its “over-circulated” condition, but it appears as if publishers still have some more work to do to bring the industry’s circ level into balance with reader and advertiser demand.