Internet Marketing: MOVING PAST THE Test Phase

By Harvey, Mary | Folio: the Magazine for Magazine Management, September 15, 1999 | Go to article overview

Internet Marketing: MOVING PAST THE Test Phase


Harvey, Mary, Folio: the Magazine for Magazine Management


IN THE PUSH TO DIVERSIFY NEW BUSINESS SOURCES, CIRCULATORS TAKE THEIR WEB- AND E-MAIL-BASED EFFORTS TO THE NEXT LEVEL.

The Internet is starting to pay off For years, circulators have stuffed test dollars into the new medium in the hope of building a much needed supplier of new business. And now, circulators say, they are seeing enough volume to justify their expenses and expectations.

Although less than half of all Americans are operating in Cyberspace, approximately 88 percent of all publishers are now taking subscription orders via the Web, according to one recent study. And while e-mail marketing still has some way to go before it morphs into a profitable direct marketing medium, more and more publishers are rolling out prospecting programs.

Obviously, every quirk has not yet been wrenched from the Net. "We're still tying to find out what the right mix is and what kind of services people really want from the Internet," says Prevention consumer marketing manager Frank Dragotta. "But the Internet is evolving toward direct response marketing, and that's what circulation does."

Net-generated volume is still relatively modest for most. "Nobody's really moving the ratebase needle with online subs," says Hearst Magazines' Internet marketing manager David Berger. And Dan Capell, editor of "Capell's Circulation Report," estimates that of the 116.6 16.6 million new subscriptions reported by Audit Bureau of Circulations members in 1998, fewer than 5 percent were collected via the Internet.

But for many, the Internet's possibilities now seem limitless. "Our goal here is to use the Web to take paper and postage out of subscriptions sales and service," says John Griffin, president of Rodale's magazine division. Griffin estimates that Rodale will sell roughly 200,000 subs via the Web this year, but would like to see 100 percent of all new business coming in electronically. "Doing all renewals, bills and subscriptions on the Web could potentially have the biggest single impact on a magazine's bottom line," says Griffin. "It would provide tremendous economies for us and allow us to give better service."

Ahead of the pack

Not surprisingly, some Internet- and computer-focused titles that were quick to embrace the Net as a source have had the most Cyberspace success thus far:

* Ziff-Davis Inc.'s 650,000-circulation Yahoo! Internet Life, which began taking sub orders via the Web when it launched in early 1996, has seen gross Web orders in the high six figures every year, says senior circulation director Steve Sutton.

* In any given month, the 116,000circulation Red Herring receives some 10,000 Web orders through a variety of Internet sources, says June Sargent, vice president of circulation. Roughly 30 percent of these originate from the magazine's site, with the rest coming from buttons or banners on affiliated sites such as Yahoo! And Ziff-Davis' ZDNet. While 20 to 25 percent of all new orders in 1998 came from the Internet, Sargent says, this number is expected to surpass 40 percent this year.

Titles whose audiences tend to be younger, and therefore more techno-savvy, also have an advantage online.

* The average age of ESPN's readers is 28 to 29, but the average age of visitors to the four-year-old ESPN Web site is 24 to 25, says Tom Slater, circulation director of ESPN. And in early 1998, that younger Web audience helped generate between 25,000 and 50,000 sub orders before the magazine even launched. To date, the Disney-Hearst-ESPN title, with 720,000 subscribers and a ratebase that's jumped from 350,000 to 700,000, has taken in more than 100,000 gross orders via the Web, Slater says.

* The CosmoGirl! Web site was also already up and running when the new Cosmopolitan spin-off for teen girls hit the newsstands in June. And according to Lindsay Valk, Hearst Magazines senior vice president, director of circulation marketing, the CosmoGiri! …

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