What will be the five main challenges for the magazine industry in 2019?
I think the first challenge will clearly be around print revenue. In most markets, this will continue to decline, although there are signs that this is happening at a slower rate. In turn, this will create pressures on costs – which is probably the second challenge, how do we make traditional print operations even more efficient. I am fairly sure you will sure more merger and acquisition activity in 2019, even after the frantic deal-making of the past few years. Our third challenge is in advertising, where digital advertising, which has long delivered lower revenues per consumer than print, is now also facing a crisis of trust among marketers. We must continue to diversify our revenue base in 2019 to avoid dependence on advertising for our survival. Finally, I think there will continue to be challenges for publishers in attracting and retaining staff – the jobs market is ever-more competitive, particularly for young, digitally-savvy talent.
How should we tackle the challenges?
I think there are probably three major things publishers need to do. The first is to collaborate more. In areas such as challenging the power of big digital platforms and tackling digital ad fraud, the industry is far more effective if it operates with a single voice. Supporting organisations such as FIPP, your local publishing association or other international bodies is a very effective way of ensuring our voices are heard ‘as one’. The second is to continue our commitment to continuous learning. The media industry will change at an even faster pace in 2019 than it did in 2018. The only way you can keep up with this rate of change is to make both a personal and an organisational commitment to learning, Conferences, white papers, new stories, podcasts and videos – all of these provide a wealth of information from the industry that you must consider and absorb. The final aspect is around identifying new opportunities for your business though networking. Companies are becoming increasingly inter-connected, both in terms of their technology usage and their general business relationships. If you operate in isolation, the chances are you will be left behind. Committing yourself to regularly meeting new people and considering new ideas from third parties is an essential part of meeting the challenge of today’s media industry.
What are the five biggest opportunities for magazines in 2019?
Well, I can give you 11 opportunities! Our colleagues at Innovation Media Consulting, with whom we produce our annual Innovation in Magazine Media Report, have identified 11 new business models that publishers must pursue to successfully diversify their revenue. I won’t steal their thunder by telling you all of them, you’ll have to check out one of their regular presentations at industry events. But I do think that the biggest opportunity is in paid content. Our inaugural Digital Subscriptions Snapshot, published earlier this year, revealed a huge range of news publishers making significant revenue from charging consumers directly for their content. There is a real sense that consumers are increasingly aware of the value of journalism and are prepared to pay for it. The opportunity for magazine publishers is to move into this space too and I think you will see a large number of companies trying this next year. But before you dive into this space, you must be sure that you are producing high-quality, unique content that is valued by your audience, otherwise you will struggle to convince significant numbers of consumers to pay for it.
What new trends will have impact on the magazine business in 2019?
I guess the three biggest areas we’ll be watching 2019 are : i) voice; ii) AI; and, iii) blockchain. Of these, voice is the furthest advanced. There are over 50 million smart speakers now in circulation globally, mainly Amazon Echo and Google Home devices. The continued growth of these is going to make development of voice products essential for publishes in 2019. Usage of AI is mainly confined to other industries at present, particularly the growing self-driving car market. In publishing, we can expect greater use of AI in marketing, particularly around paywalls, as well the increased automation of routine tasks such as basic journalism and translation. Finally there is blockchain. This has been much-hyped and there’s no doubt that the first applications will be in the banking industry. However, there is a lot of potential usage for a permanent, unalterable record of transactions and ownership in our industry too and media companies would be wise to monitor developments closely.
This is only a very brief summary of some of the challenges and opportunities that our industry faces in 2019 – we will be discussing these and more at our two major events next year, the Digital Innovators’ Summit (Berlin, 25-26 March) and the FIPP World Media Congress (Las Vegas, 12-14 November), I look forward to seeing you there!
See you in 2019!
James Hewes President and CEO FIPP – the network for global media