Squeezing cash from brands

Merchandising activity looks like being flavour of the year for the big publishers as they try to push up profits. Three examples this week so far:

• NME is launching an online shop with music marketing company Trinity Street for t-shirts, CDs and other products. The aim is that ‘users will be able to purchase the brands worn by their favourite artists, including Converse, Pa:Nuu, Amplified, Rebel 8, Illustrated People and Brixton Hats’.

• The Economist has launched free audio guides to 20 cities for business travellers. They are available to listen to, or download from a page sponsored by Blackberry (and that’s no doubt where the money comes in!).

• The News of the World’s Fabulous supplement with links to buy the products seen in the magazine from the website.

It’s easy to underestimate the importance of merchandising and spin-offs to magazines. I learnt the lesson in my first two jobs - at an academic journal where the spin-off conference/exhibition would make more than the journal in a year and at a weekly for doctors where the GPs would not only buy medical kit off the mail-order pages but just about anything else, from chess sets to sheepskin coats.

When I became editor of a computer magazine, I launched a software line based on the  readers’ games listings we published. Later, when the magazine was taken over by Redwood Publishing, one deal I did saved the company from going bankrupt in its early days.

We sold hundreds of bar code readers for computers at £100 each and Mike Potter - the company’s MD - and his wife were, I discovered later, packaging them up at home and sending them off as fast as the orders came in. Redwood only got a 10% cut but the fact that the cheques were made out to Redwood and the money sat in the bank for several weeks was life-saving cashflow.

Potter then set up a special department with two people to push the spin-offs and up to eight pages an issue were devoted to them. The money from such ventures can easily be the equivalent of having an extra issue or two a year.

Where do all the readers go?

IPC releases website figures (ABCe) for three of its big titles - NME, Nuts and Loaded. The statistics make interesting reading, especially when you try to tie them up with NRS readership figures and ABC copy sales. See what I mean -

 

Title …… ABCe ……ABC ….NRS …………..NRS/ABC ….ABCe/ABC
NME ….1,693,196 ….68,151 ……499,000………. 7.32 …………… 24.84
Loaded ..206,952 ..120,492 ..1,010,000………. 8.38 ……………. 1.72
Nuts …….631,467 …277,269 ..1,242,000………. 4.48 ……………. 2.28

So, NME ’s online readership is three to four times bigger than in print - and a massive 25 times compared with copy sales; yet, 4 out of 5 Loaded readers never get to its website; and half of Nuts‘ readers don’t make it online either. Easy to see why IPC is pumping money into its music weekly with radio and TV spin-offs - and Loaded can’t be long for this world at this rate.

NME and Loaded (as Uploaded.com) were among IPC’s first websites in 1995, but it shut the latter down before coming back as Loaded.com - has to have been a mistake throwing away all that brand equity. Perhaps all the Loaded and Nuts readers turn to Dennis’s Monkey for their web fix.

(ABCe for Jun 07; ABC Jan-Jun o7; NRS Jul 06 - Jun 07)

NME goes radio ga-ga

IPC is following up November’s announcement of a TV channel for music weekly New Musical Express with NME Radio in a partnership with multimedia music company DX Media.

The round-the-clock digital station will focus on ‘cutting-edge sub-genres’ and will be launched in mid-2008. Ad sales will be handled by IPC Ignite.

NME publishing director Paul Cheal said: “It’s the next logical step … the NME brand already has fantastic reach amongst an audience who are notoriously difficult to target. Launching a radio service which allows that audience to hear NME recommended artists first, as well as the very best in indie music, is very exciting.’

Emap switches tack

Emap’s website describes the company as ‘Consumer magazines, b2b, commercial radio, television’. Yet a press release today uses the description ‘Emap plc, the B2B and consumer media group’ even though the release is about a music TV deal. So is B2B the way it wants to go?

Win some, lose some

Vogue magazine has lost a trademark dispute over a perfume of the same name (Press Gazette). The patent office has backed United Toiletries & Cosmetics, which has been selling perfume called Vogue since 1982, against an attempt by Conde Nast to stop UTC using the name.

IPC went to court in 1996 to prevent Valucci Designs filing a UK trade mark for the word ‘Loaded’ covering clothing. In that case, the publisher won, with a ruling that said allowing Valucci the rights to the name would prevent IPC selling promotional Loaded T-shirts and might limit and damage the magazine brand.

The Loaded name has since been licensed for beer and sister title Nuts has lent its ‘credibility’ to pub entertainment games, a personal greetings cards service, books and calendars. In the US, Maxim has set its name to steak houses and nightclubs.

Reading such cases is interesting not only to get a feel for how the law thinks, but also for what the cases reveal about the parties. Vogue has to prove it is a famous magazine and Loaded had it prove it was a well-known, successful title - and it quoted its turnover for three years as evidence (where else could you get those figures!).

Lest anyone think that magazine brands and brand extension are not big money-spinners for publishers, let me just say one word: Playboy.