Can Magazines Make the All-Digital Leap?

Print is in trouble. That’s hardly news. What’s new is publications looking to cross the chasm and go from print-first models to online-only approaches. Just last week Dow Jones personal finance magazine Smart Money said it would scrap its 20-year-old print publication in favor of the Web. It is following in the footsteps of the Seattle Post-Intelligencer and most recently, the Times-Picayune.

It’s hard to fault these publications for the move. The fact is the business model of many print publications has broken apart from reader habits and perceived advertiser value. By going Web-only, a publication sheds tons of overhead. The tradeoff: They also shed healthier ad rates that print still commands on the bet they can become one of the few online publications to command top dollar in an increasingly commoditized online ad market.

Whether the medicine is the right cure is an open debate. What’s not is the ailment. Consider the environment for Smart Money. According to the Audit Bureau of Circulations, the magazine has about 800,000 subscribers, and that number has held pretty steady over the last couple of years. ComScore puts at 1.6 million unique visitors in May, up from 1.4 million in May 2011, or a 14 percent increase.

Its business model showed where print is going. According to the Association of Magazine Media, the publication dropped 12.9 percent of its revenue from 2010 to 2011 (from $37.5 million in 2010 to $32.7 million in 2011), as well as a 17.4 percent drop in ad pages, from 409 in 2010 to 338 in 2011. Meanwhile, on the Web, personal finance is one of its most established (and lucrative) categories. Unlike much content, it carries with it a powerful intent signal. A person visiting, say, the investment section of is a prime target for finance advertisers. That’s why, according to the Interactive Advertising Bureau’s Advertising Revenue Report, financial services was the second largest online ad spending category last year, accounting for 13 percent of 2011 revenue. The $4.1 billion spent by financial services advertisers was up 28 percent.

“It’s disappointing for Dow Jones because it’s a print and financial company,” said Debbie Sklar, vp and director of print services at Horizon Media. “You’d think they’d be in more support of these media channels. If they feel they can merge the content from print to dot-com or app or even into the Journal, I’m sure they’ve done the research.”

There’s also a product question. The fact is, running a monthly magazine with website is far different from being a real-time, always-on digital media company. Print brings with it certain rhythms (and personnel) that often aren’t suited for the chaotic hurlyburly that is the modern digital environment. It plans to build Smart Money’s editorial team from nine to 15. Along the way it is changing out the editor-in-chief and requiring existing editorial staffers to reapply for positions.

On the sales side, Smart Money and other publications making this leap will find a dramatically different environment. After all, Dow Jones is no stranger to the power of offering a print-online package, though according to several buyers, Dow Jones consistently fell short in this department when it came to Smart Money.

George Janson, managing partner and director of print for GroupM believes Dow Jones didn’t do a good job packaging Smart Money with the Wall Street Journal and Barron’s, and he sees clients who are currently running in Smart Money magazine will likely allocate those dollars to other print titles that have comparable reach.

“We need to know the resources and investment that will now be placed behind before we would decide on level of investment in their digital properties,” Janson said. “[I] don’t recall any magazines that folded and became overnight sensations vis-a-vis digital properties.

“While Smart Money offered a unique point of view within the category, they continued to face the challenge of relevancy with their readers,” said Justin Wroe, svp of client business partners at Universal McCann. “Operating on a monthly model, it’s incredibly difficult to tell a unique and engaging financial advice story.”

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