A Little About the 'Audit Bureau of Circulations'

People outside of the advertising world (and I'm one of them) probably never heard of the ABC (the 'Audit Bureau of Circulations'), right? Right.

Up front I have to tell you that I hate ads and commercials...especially when I am enthralled in a good documentary, drama or mystery...and my program is interrupted by a f---ing commercial...complete with blaring volume!

"Could switching to GEICO really save you 15% or more on car insurance?" (Like I really give a shit for that chump-change money anyway?)

This commercial answers with another dumb question: "Does a little piggy cry 'wee, wee, wee' all the way home?" (This really has a lot to do with car insurance, right? I wished the damn piggy would 'wee, wee, wee' all over the commercial's creators AND GEICO for putting it on and polluting the airwaves!)

And then I have to watch some damn pig with it's head hanging out a car window yelling 'wee,wee,wee'!

But, I digress and will get off the soapbox.

In the real world, at least the part built by business & commerce, our shows are brought to us on air for free through paid commercials for sponsors.

Now, to move more quickly to point, magazine ads serve the same purpose...or do they? (We still have to buy the magazines complete with ads...WHY is that? Silly question, huh? Can somebody answer this one for me? Come on, just for fun...Give it a shot.)

Back to the ABC, seems they have changed the rules for counting digital editions toward paid-circulation guarantees (a number used by advertisers to decide if they want to pay and how much to pay to advertise in a particular magazine).

Basically, the ABC now says that the digital versions of print magazines do not have to contain all the same ads that were included in their print sisters to be counted toward that digital magazine's paid-circulation guarantees number.

Nat Ives (Adage.com) , writing for Crain's New York Business, has more details on this intriguing magazine business/publishing/advertising rules change:

iPad changes magazine circulation rules

Life is about to become more complicated for advertisers. iPad editions no longer need to include every print ad to count toward circulation guarantees.

Read and learn more

Print Magazine Advertising to Grow in 2010 Despite Popularity of Online...

...For first time, however, spending on digital expected to outpace print.

It looks like all media types (especially print and digital) might be seeking (and finding) their own level RE advertising profits. I have mentioned in previous posts that when the newness of digital gadgets (Kindle, iPad, plus more to come) wears off a little and the dust settles...that print will still be standing, albeit not dominating.

One of my favorite go-to industry sources, FOLIO magazine's reporter Jason Fell, reported this today:

Consumer and trade businesses this year are projected to spend approximately $119.6 billion on online and digital advertising strategies while shelling out $111.5 billion to print projects, research and advisory firm Outsell said Monday. Some good news for print: Ad spending on magazines is forecasted to be up 1.9 percent to $9.4 billion.

According to Outsell’s “Marketing and Ad Spending Study 2010: Total U.S. and B2B Advertising” report, overall spending on marketing and advertising will be $368 billion this year, an increase of 1.2 percent over 2009. Taking an overarching look at b-to-b and b-to-c businesses, the report projects spending, share and growth for five media types—online, events, print, TV/radio and PR/other.

Other findings from the report included that b-to-b advertisers see cross-media marketing as the most effective option with 78 percent combining three or more marketing methods; advertiser’s own Web sites generate the highest ROI for b-to-b; and social media has a firm place in marketing efforts—51 percent said Facebook is “extremely or somewhat” effective, 45 percent for LinkedIn, 35 percent for Twitter and 25 percent said the same for MySpace.

For the 2010 report, Outsell said it surveyed more than 1,000 U.S. advertisers in December 2009.

Playboy Passes Core Business Duties to AMI

Playboy is delegating advertising, sales, marketing, circulation and production to get lean and mean and return to profitability by 2011!

The venerable mens magazine is also being assaulted by the current economic times as well as technological multi-media advances (what ever happened to Mariyln Monroe ?)

Jason Fell of Folio Magazine reported the inside info on this Playboy re-structuring with some interesting, insightful figures:

During a recent earnings call, Playboy Enterprises CEO Scott Flanders said he was working on a joint venture to develop a new business model that would help Playboy magazine profitable again. Some details of that venture have come to light.

Playboy said it has agreed to farm out the magazine’s advertising sales, circulation, marketing, production and all other business operations to American Media Inc. Playboy will continue to oversee the magazine’s editorial operations.

AMI's Distribution Services, Inc. will handle Playboy's newsstand marketing and distribution services.

Roughly 25 jobs will be affected as a result, although some of those could be transferred to AMI. “AMI will be interviewing all of our employees in the areas being outsourced, and it’s not clear how many of them will be asked to join their company,” a Playboy spokesperson told FOLIO:. “We will also keep a few employees.”

Playboy will incur a $2 million restructuring charge in the fourth quarter related to the deal.

Financial terms were not disclosed. As part of the agreement, Playboy said AMI will be paid “negotiated fees” and will be incented to increase both advertising and circulation revenues. The publishers expect to complete the transition by March 2010. UPDATE: Under terms of the contract, AMI said it will be paid "potential fees" in the range of $5 million for advertising, circulation, production and related services. This, the company said, would result in profitability of approximately $2 million.

When asked about AMI's strategy behind boosting Playboy's ad and newsstand sales, and its plans for managing the magazine's recently reduced rate base and frequency, AMI CEO David Pecker had no comment.

According to Flanders, AMI will be able to manage the magazine operations “more effectively than we can as a standalone publisher. By joining forces with American Media, we will be able to significantly reduce our cost structure and leverage the economies of scale related to manufacturing, distribution and marketing that are available to this large, multi-title publisher.”

Flanders said Playboy magazine is expected to lose $8 million this year. This deal, he projected, will allow the magazine reduce the loss to approximately $5 million in 2010 and to reach profitability again by late 2011.

During the earnings call, Playboy Enterprises reported a $23.5 million net loss through the third quarter, down from a $13.6 million net loss in 2008. The company’s print/digital group reported a $900,000 loss through the first nine months compared to a $3 million loss during the same period last year. Flanders said he expects the magazine to report a 38 percent decline in ad pages during the fourth quarter this year.

AMI publishes several titles already targeting man aged 18 to 34 years, including Men’s Fitness, Muscle & Fitness and Flex. AMI also publishes Shape, Star, Natural Health and the National Enquirer.

It was not immediately clear how the agreement with AMI might affect a potential sale of Playboy Enterprises. The company has been said to be entertaining a number of offers, including one from London-based brand management firm Iconix Group. The Playboy spokesperson declined to comment on a potential sale.