Moving our focus out for an international perspective, Ian Watts dropped in on the Publishing Pandemic Roundtable—Bo Sacks, Gemma Peckham, Joe Berger, Samir Husni, Sherin Pierce, and me—to tell us that there are bright points of hope in a world market that is still facing the impact of the pandemic.
Ian is the Director of Pincot Consulting Ltd, from whence he provides international circulation services to Genera Solutions, America’s largest magazine exporter. I can’t remember when I met Ian; he’s been in our business a long time. He started out with WH Smith Wholesale in the UK in the 1970’s.
“That was a great academy for English circulation people, back in the day,” he tells us. “They did great training, hoping to invest in people they would then keep for life.” Those who left were picked up by publishers—in Ian’s case, Murdoch in the 1980’s, then SM Magazine Distribution, then Hachette, who owned an export company in the UK and COMAG UK. He’s been in international ever since.
Following a stint as International Sales Director of Comag UK, Ian went on his own. His specialty was taking kids’ product and making it international product. He launched some big success stories internationally, including Spice Girls magazines, and later Sudoku magazines. His job now is to liaise with the 70-80 markets around the world that receive American exports and get the best deals and service for Genera’s US publisher clients.
Ian: It’s a fascinating, exciting field. Every market around the world is an individual market with its own characteristics, facing the same issues that we face, but dealing with it individually. It’s very stimulating, learning about how these different markets manage.
Joe: Can you give us an idea as to how these various markets look for imported product?
Ian: Due to Covid responses It’s tough everywhere. International markets are going through a hard time for their own domestic publications; and it’s harder still for import. A lot of the import sale comes from travel locations, and of course travel has been decimated in most countries. There are exceptions. Some of the larger markets, for example Australia, continue to have domestic travel; but overall travel is down 90%, and outlets are closed in many airports. The sales we are currently getting are indicative of the market for import products consisting of people who live in the market, as opposed to travelers. They could be local-language speakers, or expatriates.
Joe: Do you see any bright spots?
Ian: There are certainly exceptions to this downturn. The strong, heavy-edit magazines, ones that look toward American politics, and to how we might fix the world, ones oriented toward business, are doing relatively well travel outlets notwithstanding. Examples are Foreign Affairs, Atlantic magazine and the New York Review of Books. US Business magazines are highly respected, for example Harvard Business Review.
Linda: New York Review of Books actually increased in sale in markets where sales of US products were dropping up to 50%.
Ian: We saw some new opportunities arise. In many countries throughout the world, we’ve seen a resurgence of domestic kids’ magazines, so we took a look at our portfolio. Now, for example, Thrasher magazine is performing strongly in Australia and across Europe.
Sherin: COVID aside, have you seen the political situation over the last four years causing a decline in US magazine sales? America used to be a shining star, but it seems that glow is tarnished. People used to buy magazines for US culture, lifestyle, aspiration. Do you see that as continuing?
Ian: With the loss of sales internationally, it’s difficult to pin down changes that might be due to politics.
Samir: For a majority of magazines, it’s pop culture that draws people. A Thrasher reader wants to know about skateboards, not about who is president of US. People really don’t give a hoot.
Ian: Yes, for example when you’re talking about surfing, who doesn’t want a magazine from California? And the coolest kid is always the one with a copy of the physical magazine in his hand. We’ve seen outstanding recent success with Esquire featuring BTS (the Korean pop phenomenon) on the cover. Samir: Esquire went to a second printing; and wholesalers had to pay in advance for the copies they ordered.
Ian: They printed tens of thousands copies of the US version in Korea for a sell-out.
Samir: Fascinating how they are working to get a younger audience without losing the older.
Ian: Harry Styles was an even bigger success. Selling over 90%--unheard of.
Samir: When was the last time you heard of something like that on a website or digital platform?
Ian: Fans are so devoted they seem to get info about this quicker than we do. Politics and digital technology aside, if you have a premium brand and a hot topic, magazines still deliver what the audience wants.
Joe: Stateside we see a trend to bookazines eating up a lot of mainline and checkouts. Do we see that in overseas markets?
Ian: Very much so. If you go into a WH Smith, most of the prime real estate is bookazines.
Sherin: Can you give us a picture of the import market in Europe?
Ian: Of course, in many markets, sales are predicated on the ability to read English. And then, we get back to the unique features of every market. In France, for example, they’ve had structural problems over the past years. Not only pandemic-related; they suffered the loss of their major distributor, NMPP, in 2020. NMPP was a coop owned by publishers to distribute magazines and newspapers, and it was preserved by law from 1947 under the Bichet law whose intent was to ensure that news be available throughout the country, and accessible to all. Since the 1950’s, NMPP never made money. It was repeatedly bailed out by the government. Reality hit this year. Another distributor was established and picked it up, but there was a hiatus. We stopped shipping, only restarting in September.
In Germany, they kept the train outlets open because Germans desperate for reading matter went into the stations to buy knowing that they are the go-to range stockists. In Italy, almost as a matter of principle, the news kiosks stayed open, but sales are badly down. Spain’s economy is driven by tourists from Northern Europe, and no one is arriving.
Throughout Europe we need the traveling public back.
The vaccine is rolling out fast in Britain, and Portugal and Cyprus have been the first to step forward to say they’ll allow British travelers in from May. The progress of the vaccine in continental Europe has been initially much slower, but the EU and country governments are beginning to get things moving.
Joe: What about Australia and New Zealand?
Ian: Still a good market. New Zealand is a small market, with only 6 million people, but it has the highest literacy rate in world. The NZ market was hit hard when Bauer closed its publications. But we’re seeing a bit of a resurgence as former Bauer employees set up “me too” titles to replace what was lost and creatin former Bauer title are relaunched by independent publishers. Also, they’ve been able to securely lock down those two islands, so they haven’t been hit as hard by COVID. The same thing is happening in Australia. The news agencies have always been considered essential retailers; they never closed and have even seen increases in some sectors, like crafts, kids and puzzles.
Their complaint is that there is less US product arriving. Some publishers decided to cut export, and others closed entirely, so not enough was being shipped. Despite this reduction in supplies, they are only 11% down—a good number. We’re going back and saying now’s the right time to get back into this market.
South Africa also had a distributor that exited last year, but fortunately in that market there still are choices, we found a new distributor, and despite hiatus issues sold through well. We’re finding the people there desperate for reading material.
Sherin: Do you see growth possibilities in South America and Africa?
Ian: The only market worth anything from a North American or British point of view is South Africa. They have a problem with the emigration of bright educated youngsters. But they have a good audience in the older sector and an emerging middle class. Zimbabwe had its moment but since the devaluation of their currency the market has disappeared. We have small representations in Uganda, and throughout east Africa. In those markets few people have the money to buy magazines at the prices we’re asking.
Samir: Will the increasing diversity that we’re seeing in American magazines help in Africa?
Ian: Perhaps it ought to; however, in some the South African market, the readers don’t necessarily self-identify by race; they see themselves as middle class, aspiring people. They may be more likely to buy a GQ than an Ebony.
Sherin: what about India’s enormous, well-educated, and upwardly mobile population?
Ian: Imports tend to be too expensive for India. Also, to some degree the population has bypassed print and gone straight to mobile.
Linda: There’ve been a few successful publishers who have the scale to print in India and sell at local prices.
Ian: We’ve been down that road. By the time you’ve negotiated your contracts, factored in freight and been paid in rupees, it really doesn’t pay off.
Samir: How is the Japanese market doing?
Ian: There are 1.25 million Japanese, with only a maximum count of 150 retailers taking English-language press. Yet they are innovative. They were the first country to start to sell single copies online. The distributor treats Amazon Japan as one of its retailers—and it is now the largest newsstand retailer in Japan. Our distributor even owns a bookstore https://bunkitsu.jp/ where customers pay an entry fee and we are told this is a great success.
With space under pressure at retail, Europe needs to go in that direction as well. Magazine Heaven has a large online store; and the UK’s largest, Newsstand.uk, was growing 20% annually before COVID. It’s an exciting development. The trick is going to be to have a brand that becomes known in the real world. WH Smith, for example, would be a powerful brand for an online store.