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Circulation Field Technology
Enabling a New Tomorrow
Chris Christian
VP Circulation – The Kansas City Star
“Remember that a kick in
the ass is a step forward.”John Chaucer
• Managing a Declining Model– Circulation
– Advertising
• Denial
• Insanity!!
Media Trends
• Overwhelming choices for media consumption and communication– Initially just NBC, ABC, CBS– Then cable and I want my MTV– Internet explosion– I want my MP3– Commercial free Satellite Radio– I want my custom ring tone
Media Trends
• Customers want Control and Choice– DVR generation– Explosion in Magazine and Video
narrowcasting• Niche title growth• A channel for any interest, hobby• Facebook; MySpace• Blog-blog-blog• YouTube
How Has Our Industry Responded?
• Offered multiple frequencies of delivery
• Repurposed content on Web at no cost
• Minor tuning of the ‘Sectional Revolution’ that originated in the 70’s
• Informational graphics
• Shorter stories and summaries
• Isolated free niche startups
• Largely still a one size fits all print model...
Net Paid is our Health Barometer
• The patient is on life support
• Declining circulation since Post WW II
• Exacerbated declines since late 90’s
• Declines masked by ‘Other’ circ.
• Circ revenues declining at 2%+ per yr
• Acquisition costs are increasing
• Our franchise is under attack…
Newspaper Circulation Trends
Year
Total M&E Daily
Third Party Daily
Core Daily Total SundayThird Party
SundayCore Sunday
1995 58,193,397 61,229,296
1996 56,983,290 60,797,814
1997 56,727,902 60,486,463
1998 56,182,092 60,065,892
1999 55,979,332 59,894,381
2000 55,772,847 59,420,999
2001 55,578,046 59,090,364
2002 55,186,157 916,232 54,269,925 58,780,299 236,709 58,543,590
2003 55,185,351 1,282,365 53,902,986 58,494,695 569,507 57,925,188
2004 54,626,424 1,545,927 53,363,497 57,753,242 822,207 57,146,035
2005 53,345,428 55,270,239
Source: Editor & Publisher; ABC
How Magazines are PerformingNumber of Magazines, 1996-2006
Year NDM SRDS ABC
1996 17,195 2,470 711
1997 18,047 2,513 751
1998 18,606 2,522 758
1999 17,970 2,520 750
2000 17,815 2,567 836
2001 17,694 2,600 817
2002 17,321 2,431 764
2003 17,254 2,509 703
2004 18,821 2,570 708
2005 18,267 2,640 718
2006 19,419 2,790 741NDM: National Directory of Magazines; SRDS: Standard Rate & Data Services
How Magazines are Performing
Year Subscription Single Copy Total
1996 299,532,710 65,984,883 365,517,5931997 301,244,640 66,133,817 367,378,4571998 303,348,603 63,724,643 367,073,2461999 310,074,081 62,041,749 372,115,8302000 318,678,718 60,240,260 378,918,9782001 305,259,583 56,096,430 361,356,0132002 305,438,345 52,932,601 358,370,9462003 301,800,237 50,800,854 352,601,0912004 311,818,667 51,317,183 363,135,8502005 313,992,423 48,289,137 362,281,5592006 321,644,445 47,975,657 369,620,102
AVERAGE CIRCULATION PER ISSUE, 1996 - 2006
Averages calculated by the MPA from ABC statements for the first and second six months of each year. Domestic titles audited by ABC; annuals, international editions and comics have been excluded. Totals may not add up due to rounding.
Book Readership in Decline
• “You may have heard about the recent, mind blowing study by the National Endowment for the Arts in which it found that book reading has decreased 10% since 1982. Fewer than 47% read any form of literature in the previous 12 months.”
Meg Weaver, president of Wooden Horse Publishing, 12/30/2004
Time to Change…
“Only dead fish swim with the current.”
Oren Harari
The Cable/Satellite Model
• The Cable/Satellite Model• Basic Service• Optional Choices at Premium Pricing• Quantity - Quality
– MLB package; ESPN Plus; NFL package; etc– Expanded Movie Choices– Additional Shopping, Music, Niche Sports (Speed
Channel, Outdoor, etc)
Unbundling The Star
• Unbundled newspaper/tailored content – Weekly stock recaps delivered on request – TV Book by Subscription– Create targeted value-added-sections– Expanded sports, entertainment, etc
• Implications of ABC day of week reporting• Any day subscription offers – premium priced
– Will we allow subscribers to omit certain sections in the future?
Additional Considerationsfor an Unbundled Model
• ABC Issues• Content Development
– What and How– Core vs. Premium, and at what Price?
• Infrastructure considerations– P & D– Route Sizing– Press– Distribution Center Design
Unbundling The Star
• Improve Customer Loyalty
• Provide Price Elasticity
• Improve Audience Growth
• Increased Advertising Revenue
• Okay, but how can we deliver
such a variety of products?
Current Star Throw Book
• Backlit Display on Portable Unit
• Updated Manifest Information
• Automated Downloads
• Internal Modem or USB
• Updated Bundle Mail Information
• Directions from DC to First Throw
Electronic Route List at K C Star:
Electronic RouteList:
Updated each day in sequenced delivery order with:
House Counts
Left & Right Throws
Delivery Instructions
Product Code
Driving Instructions
What ERL will Provide The Star
• New revenue opportunities for Circulation.
• Enhanced capabilities to support new revenue opportunities for Advertising.
• Provides for tailored content/unbundling the daily newspaper.
• Delivery Time Stamp
Enhanced Capabilities to Support New Revenue Opportunities for Advertising
• Address-specific delivery to subscribers and non-subscribers
• Inserts
• Niche publications
• Samples
• Others……
Additional ERL Applications
• Single Copy Management– daily drop/count information– automation of returns– delivery time stamp– ability to handle alternate products
• Door Crewing– sub/non sub list– previous sub history– collections
Improvements in Circulation Performance
• Reduced delivery errors– No more reliance on memory– New carrier/substitutes/down routes– Starts/stops/vacation– Placement– Multiple frequency complexity– Alternate product delivery
We Can Determine our Future
• Bold
• Calculated Risk Taking
• Embrace Change
• Anticipate and Lead Trends
The Future?
Electronic Paper Devices Now Available
The FutureFlexible Electronic Paper?
Phillips and E Ink Partnership:
Flexible as Construction Paper
Like Paper, Rollable
Not Breakable, Like Glass
Low Power Requirements
Twenty years from now you will be more disappointed by the things you didn't do than by the ones you did. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. EXPLORE. DREAM. DISCOVER.
MARK TWAIN