Lean-Ad, Low-Ink Diet

If you're a regular reader of magazines serving the printing and allied industries, you may have noticed that they've gotten a lot thinner over the past two years. This unwanted weight loss is the result of the serious decline in advertising pages among not only printing publications, but virtually the entire magazine industry.

After a relatively good advertising year in 2000, the downturn in the national economy that began after September 11, 2001, saw ad revenues in all media begin a drastic decline that continued through 2002 and 2003. Although revenues across the advertising spectrum had begun to improve appreciably this year, an article appeared in The New York Times headlined "Ad Recovery Doesn't Extend To Magazines." The story pointed out that although advertising overall went up 6.1% in 2003, advertising pages—which had nose-dived 21% in 2001 and 2002—were flat in 2003 and had again declined 2.3% in the first quarter of 2004.

Magazine advertising historically lags behind in economic turnarounds because advertisers delay media buys until assured the turnaround has "legs." However, now disturbing is the increased competition to print from other media. Compared to 2003, in the first seven months of 2004 advertising on the Internet rose by 20%, cable TV by 14%, syndicated TV by 13%, radio by 7% and newspapers by 6.5%.

Bringing up the rear, magazine advertising was up 5%, but not across the board, with gains occurring in less than half the 12 major ad categories tracked by the Publishers Information Bureau. But, says Rita Conrad, director of corporate communications for Flint Ink, "The top magazines in their categories seem to be holding their own against the smaller publications. If 80% of ad dollars are cut, the remaining 20% goes to the top magazines." As examples, she cites category leaders Golf Digest and In Style as magazines that fared somewhat better than smaller competitors.

Taking the brunt of advertising page losses were magazines serving industries which themselves are not doing well, among which falls those serving printing and allied industries. The hard times besetting this segment were brought home in September, when Cygnus Publishing suspended publication of four regional magazines—Southern Graphics, Printing Journal, Print & Graphics and Printing Views.

Obviously, any loss in ad pages affects the bottom line of magazine publishers. It also affects how their publications are edited. Because publishers seek an optimum ratio of 60% to 70% ads to 30% to 40% editorial, fewer ad pages cut sharply into both the number and length of articles that can be published. Aware that readers need essential information about their respective industries, magazines such as this one seek other, non-print ways to augment and supplement their editorial content, such as electronic newsletters (like Graphic Arts Monthly's e-GAM) and Web sites (see www.gammag.com).

Equally affected economically are vendors supporting the publishing chain. Printers have been curtailing operations to accommodate magazines' reduced content, shorter runs, consolidations and closures. Fewer pages mean less paper and, subsequently, the consumption of publication printing inks (heatset offset and publication gravure) has dropped significantly.

As a countermeasure, publication ink manufacturers have taken an aggressive posture to support their customers. Says Mark Levin, Sun Chemical's vice president for North American publication inks, "Although ads may never regain historic levels, we believe in the future of print media and the values they deliver. We work closely with printers to help them find ways to contend with competitive new media by increasing their quality, efficiency and productivity. We also support an educational program that shows the multidimensional benefits of print simply not available from other media."

Both Conrad and Levin also note that publication inks are used extensively in other, less-affected types of advertising, such as catalogs, direct mail, newspaper and magazine inserts, and displays. However, Conrad says that even in these markets, ink usage can take a hit. She cited a case where the elimination of a simple background tint on one advertiser's inserts reduced ink consumption by more than six million pounds over a single year.

As the economy improves, magazine advertising will return, but probably at reduced levels. Hopefully, the industry will regain its necessary place in the overall media mix.