9th ANNUAL CIRCULATION EXCELLENCE AWARD WINNERS

9th ANNUAL CIRCULATION EXCELLENCE AWARD WINNERS

2004 JUDGES

Consumer

Susan Allyn Consumer Marketing Director E-Map Metro

Jim Borth Senior Vice President Sporting News Magazine

Nicole Bowman Formerly, Consumer Marketing Director for Gruner + Jahr USA

Business-to-Business

Barry Green Vice President, Circulation Hearst Business Media

Maurice Persiani Vice President – Business Services McGraw-Hill

Joanne Wheatley Vice President, Circulation VNU Business Publications USA

This year, 23 magazines and their circulators were honored at the 9th Annual Circulation Excellence Awards ceremony, held during the annual Circulation Management Conference & Exposition.

These awards were created to honor the strategic goal- and results-driven contributions of circulators. Each year, entrants are asked to outline specific goals they had been working for during the prior year, and then demonstrate to the judges how effectively they met those goals.

The judges, who are all experienced circulation professionals, were asked to determine the number of awards to be presented within each category, or to forgo awards entirely, as they saw fit. They were all apparently very impressed because they chose to give multiple awards in several categories.

In the consumer category, there were several themes running through the strategic goals: increasing direct-to-publisher business, lowering reliance on subscription agents and cutting costs, primarily by more effective use of Web sites.

In the business-to-business category, strategic goals centered around improving the quality of circulation, achieving deeper market penetration and cutting costs.

The sponsor for this year’s awards was Synapse Group, the industry’s largest subscription agent. Richard Vogel, executive VP, jokingly said that it was a “peculiar honor” to sponsor the awards in light of “the seeming incongruity” that presents itself in light of magazines’ desire to reduce their dependence on subscription agents.

But Vogel was not daunted by this. “An ex-Time Inc.-er, Don Logan, is fond of saying “the best thing that ever happened to Time was Newsweek,” Vogel said. “And I firmly believe that the best thing for the circulation industry is to be constantly challenged…We should strive to raise the bar ourselves, through innovation, through source development, through improvements in the lifetime value formula…through all the things that the very gifted entrants this year are being honored for.” We couldn’t agree more.

Consumer Magazine Winners

NEW LAUNCH

GOLD

Teen Vogue Conde Nast

Teen Vogue launched in March 2003 with a rate base goal of 450,000, which it has raised twice since to 550,000. The magazine launched with a unique backpack size that would be teen-friendly, and had already been popularized in Europe by Glamour. The size was a challenge from a display point of view, resulting in development of a custom cardboard pre-pack that could be used as a standalone counter display. Luckily, CMG marketing was able to secure 35,000 checkout pockets fitted to the Teen Vogue size, so the pre-packs could be phased out.

Direct mail did its part too. The mailing in June 2003 had a 3% net, 49% pay-up and 21% cash with order.

Teen Vogue ended its launch year with a higher percentage of direct-to-publisher business vs. agent business than budgeted. Net revenue per paid sub was up 95% over the plan.

The judges congratulate the Teen Vogue team for “hitting every source absolutely.”

1 MILLION PLUS

GOLD

People Magazine Time Inc.

Despite being around for 30 years, People is still aggressively testing and still moving the needle.

The goals for People’s 2003 circ program were to deliver the rate base, despite industry pressures in retail and subscription sales. They also aimed to increase profits, and maintain relevance and brand health, which included an outreach to younger buyers and readers.

The judges said People did a “terrific” job shifting from agent to direct-to-publisher sources. In 2001 39% were direct sold; in 2003, 59% were direct sold. People’s direct mail success comes from innovative packages, aggressive list universe expansion and offer testing.

Newsstand efforts continued to pay huge dividends in 2004, with average sales up 103,000 units or nearly 8%. People wrote the book on what the judges called “guerilla marketing.” The magazine achieved display increases through aggressive “pocket blitzes” that sought to place racks at checkout lanes where positioning for magazines had been lost altogether.

SILVER

Essence Magazine Essence Communications Partners

Their overall goal was to increase newsstand sales and revenue, while maintaining circulation levels. The magazine also wanted to look for ways to reduce expenses without adversely affecting sub volume.

The judges were impressed with the rise in paid circulation and particularly with the unbelievably high 90% direct-to-publisher subscriptions, which were sold without premiums.

Newsstand sales were up 6% year-to-year, significantly outpacing the declining industry average – a success that has helped the magazine gain share of market among ethnic magazines.

It looks as though the circulation director retooled everything – the offer, the package – even producing some double digit lists.

Essence also made impressive strides with renewals, after doing significant price and offer testing, and a creative use of the two-for-one offer. Overall profitability ended up 15%. And all of this was accomplished while fulfilling its objective to maintain the average paid circulation at 1 million plus.

SILVER

Popular Science Magazine Time4Media

The focus for Popular Science has been set on increasing the overall profitability of subscriptions and maximizing price and response. The goals were to increase sub profitability by 10% over 2002 by increasing direct-to-publisher subs and increasing long-term renewal rates by 5%.

Marginal lists were targeted with a less expensive package, substituting the control jumbo package rather than replacing it, which has helped increase direct mail profitability by 38%.

In-house online percent of the file increased 104% vs. the prior year and gross income from this source increased 88%.

Topping off these gains, the judges were particularly impressed by the testimonial from the magazine editor, who indicated that editorial and circulation hadworked together to achieve overall success.

400,000 TO 999,999

GOLD

Runner’s World Rodale

The judges were blown away by Runner’s World having 52% of the file on continuous service, which resulted in increased renewal rates and decreases in the renewal expense base.

They also liked the magazine’s special events and their partnership with the largest mail order running shoe cataloger, which enabled them to send an issue with product shipments.

The rate base continues to grow while the net sub price has increased. An innovative 3-issue Bulk-to-Paid program has been the principle driver of rate base growth.

Holiday online gift subs are also working for Rodale. They increased 160% from 2002 to 2003, primarily due to fixed promotion positions on the home page.

SILVER

Lucky Magazine Advance Magazine Publications

Lucky’s circulation objectives were to maintain high direct request percentages, minimize use of agents, while continuing to grow the rate base. They also developed new sub sources with third party marketing partners, and improved newsstand sales in addition to their overall circulation economics.

The magazine budgeted an increase of 13% in net revenues and a decrease of 3% in overall expense.

The results speak for themselves. Lucky maintained 92% of subs sold by direct request while raising the rate base 100,000. Overall renewal rates also surged, up 15% in 2003.

They developed two impressive co-marketing relationships, the Lucky Breaks Premier Shopping Club and a very “Lucky” QVC alliance. The judges were very impressed by this partnership, where one of the Lucky editors appeared on QVC to talk about fashion. The QVC editions were promoted on air, as well as in their credit card statements and inside outgoing product shipments.

In the first five months, this program achieved 70% of the magazine’s annual subscription goal! Total circulation revenue exceeded budget by 20%.

CIRCULATION UP TO 400,000

GOLD

Chicago Magazine Eagle New Media

For a regional magazine that’s been around for a while, Chicago magazine has done a terrific job of moving every single number in the right direction.

Through aggressive merchandiser information programs and contests with their largest wholesaler, they decreased pre-return copies by 28%.

The July 2003 direct mail campaign expenses were down 23% while net response was up 22% compared to the January 2003 campaign. Cost per subscriber was reduced 36%.

What really impressed the judges was the reduced number of renewal attempts from 13 to 6 without decreasing response. Scheduling changes, new package design and new offers seemed to make the difference.

Circulation has grown 3% from the 2002 ABC statement to December 2003, while dependency on agency-acquired subs decreased 92%.

SILVER

Mother Jones The Foundation for National Progress

Mother Jones, an investigative journal founded in 1975, really knows its audience, and that audience is extremely loyal. The magazine uses straightforward messages, avoiding promotional offers that have dominated the market in recent years. Almost 9 out of 10 subscriptions come through direct mail/request, with no trial issues, premiums or sweeps, and their Internet-sold subs require a credit card to order.

Still, Mother Jones continues to show it knows how to grow circulation dramatically! Its rate base has grown 50% in the last five years. A creative breakthrough resulted in a 50% increase in direct mail response, allowing the magazine to increase mail volumes and profits at the same time.

Direct mail economics shifted from a loss to a profit through offer, list and package improvements.

Their Internet business grew too, with almost all orders sold on a continuous service, pay with order basis.

Mother Jones blew way past its budget on direct mail, Internet and gift – surpassing budget by 72% for new business and 44% over all.

BRONZE

Official U.S. Playstation Magazine Ziff Davis

For this magazine, circulation profitability has always played a crucial role. And the goal was to maintain that profitability. Sub revenue increased from $3.8 million to $4.5 million – an amazing 18% increase, and this was achieved while spending the same amount of acquisition dollars spent in 2002.

Some success is attributed to the use of blowvelopes – a BRE with detachable insert card. Although more expensive, it paid off with a 45% higher cash rate. The magazine also began converting to automatic renewal, which helped reduce costs by eliminating up to 7 renewal efforts, and the overall net auto renewal rates rose to 44%.

Also noteworthy, the magazine doubled its list rental revenue in 2003 – from $80,000 to $160,000.

The Official U.S. Playstation Magazine is the only Sony Computer Entertainment-licensed magazine in North America with an interactive DVD included with every issue. Plus, having readers who spend $9 an issue plays exceptionally well with advertisers who like an affluent audience.

BEST USE OF THE INTERNET

GOLD

Lucky Magazine Advance Magazine Publications

All the magazines are paying more attention to the Web as a source of subscriptions, but Lucky’s efforts were exceptional. Lucky had a 28% increase in net subs online. It has been very successful developing relationships with other online sites.

Just one of the many facets of their integrated online marketing includes “Lucky Breaks,” an editorial program developed with retailers to maximize exposure on the retailers Web sites by promoting the Lucky Breaks offer.

SILVER

Popular Science Magazine Time4Media

Since 2000, online has become an increasingly important direct-to-publisher source for Popular Science. The percentage of the file to come from online sources has increased from 0% in 2000, to over 5% of the DTP category in 2003. From 2002 to 2003, the size of the source has increased over 104%.

Most subscriptions are obtained through the Web site, via a unique, risk free, continuous service offer with a premium on payment if credit card is provided at time of order.

Online features include creating exit pop-up ads, built-in order forms, links from the end of every article to the subscriber page, and rotating banners and links from the Web site’s newsletter.

Barbara Venturelli, Consumer Marketing Director, accepted the award.

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