Internet Erodes Print Profits

[banner1]While the age-old axiom that “sex sells” is as true today as it ever was, most adult magazine publishers are finding their once fat (and easily obtained) profit margins eroding in the face of stiff competition from the abundant variety, accessibility, and perceived anonymity of Internet porn.

While powerhouse publisher and eternal men’s favorite Playboy celebrates their 50th anniversary, time honored brand and longtime competitor Penthouse has filed for bankruptcy. Unlike Penthouse, Playboy, which has successfully diversified its brand into video, cable, and online venues, is enjoying an increase in online sales, despite an ongoing decline in magazine subscriptions - indicating a successful adoption of new technologies into their distribution and marketing channels - despite their often lackluster early attempts.

Although the past decade’s stratospheric rise in Internet porn seems an obvious culprit in the declining success of traditional men’s magazines, the problem facing the industry may be more complex and deep seated than that.

Playboy, and more explicit rival Hustler, both saw substantial declines in subscriptions, but nowhere near the approximately 50% drop that Penthouse has experienced over the past several years. Pricing may play an important role in the equation, with some men’s magazines being as costly as a trial membership to a quality adult site, where a broadband surfer can download a lifetime’s worth of porn over the course of a weekend.

It’s not all doom and gloom for the print porn industry, however, as some adult magazine publishers are benefiting, despite the decline of others. Smaller, niche publications are still enjoying continued advertising revenues and increasing subscription sales, both online and off. Specialty, or “niche” publishing, it appears, is the secret to success these days, regardless of the medium being employed.

Even more generalized publications can mitigate profit erosion and indeed benefit from new technology if they are able to grasp its significance, and the best ways to use it. Print has inherent benefits over electronic content, and vice versa. Using the strengths of one to leverage the strengths of the other, rather than trying to duplicate content using mismatched media is the lesson to be learned.

For instance, print publications can effectively use online outlets to promote their magazines and videos in a highly targeted and extremely flexible way, while offering their traditional subscriber base access to ‘bonus’ material online. Such a synergistic approach may ultimately prove more profitable than simply mirroring their offline content on a branded Website.

While the problems facing today’s print magazine publishers are not limited to the adult sector of the market, the solutions which will emerge and the lessons which will be learned will bolster the success of all content publishers, whatever the medium. The bottom line: print is by no means dead, even if its been a bit bruised.

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