• by Larry Dobrow , March 31, 2004

Business-to-business publications continued to slump in January, with data released Wednesday by the Business Information Network (BIN) revealing a 4.6 percent drop in ad pages and a 2.4 percent decline in revenue against the year-ago period. IMS/The Auditor, which replaced TNS Media Intelligence/CMR as the supplier of BIN data, reported 42,367 ad pages and $461.4 million in revenue for the month.

While the numbers were uninspiring enough on their own, members of the AAAA's business-to-business media committee believe that the sustained market softness likely portends even darker times ahead. Among other things, they cite continued economic difficulties in many industries, the slow migration of ad dollars to the Web, and the perception that magazines offer less in the way of ROI than other mediums.

"We haven't done any [B-to-B] print in the last two years, and there's not much on the horizon," laments Quest Business Agency vice president Beth Palmer. "I recently looked through about 40 business publications, and the ad pages were just so scarce. We had a client who wanted to spend money on print, but when they saw how little was going on in these publications, they decided to do direct mail."

Gordon Hughes, president and chief executive officer of American Business Media (ABM), acknowledges that he is "concerned" about 2004 and about the continued meager spending by automotive and software companies. That said, he notes that the business suffered from difficult comparisons against January 2003--the first quarter of 2003 was B-to-B's strongest since the first quarter of 2000--and that second-quarter results should prove a better gauge of overall industry strength.

"The second quarter in '03 was pretty bad," he explains. "If we don't see some uptick this year, we're in for a pretty bumpy ride." Still, Hughes is sticking to his initial 2004 projections for B-to-B pubs: a 2 to 4 percent gain in revenue and a holding pattern in pages.

Hughes quickly shoots down the suggestion that the movement of ad dollars to the Internet should concern B-to-B publishers. "I look at the Internet as being us," he says, noting that ABM represents more Web sites (2,000) than publications (1,500). "The majority of our members are media companies, not print companies. Frankly, I don't care if somebody buys Waste Management online or the magazine, and I don't think Waste Management does, either."

Media execs are less optimistic. Roberts Communications media director Caroline Riby believes that magazines aren't exactly keen about the prospect of seeing dollars siphoned away by the Internet, and acknowledges that she has suggested that clients shift dollars away from print. "B-to-B is information-based--it's not reading for pleasure like consumer," she notes. "The Internet is much better for quick facts. It's the best place to reach people when they're actively involved in seeking information."

At the same time, Riby touts the virtues of B-to-B publications, noting their value to companies hoping to build awareness and strengthen their brands. "Even with all the new technologies, nothing can replace the convenience of being able to read a magazine wherever you go."

Martino & Binzer media director Melisa Cehajic, one of the few who has "seen some pickup" in B-to-B publications over the last few months, agrees: "Print is always going to work. What I'm seeing more of is a shift of dollars to industries that are doing well. We have a client that makes specialty fiber, and they've moved their dollars from telecom publications to military and government ones. That's a good sign for print--that they're not looking elsewhere."

As for the months ahead, Hughes doesn't deny that there may be a "Darwinian thing" going on among the B-to-B publications, and acknowledges that industries with four or five titles might see a few of the lesser ones fall by the wayside. He touts continuing education as a trend to watch. "The guys that own Railroad Age will teach others how to pull the horn and go 'toot-toot,'" he jokes. "When you think about who has the expertise to do continuing-education programs required in medicine and everywhere else, B-to-B [publications] should be on top of the list."

Services/direct response/classified (up 17.7 percent) was the only ad category that saw an increase in pages in January against 2003. Services (18.3 percent) and finance/business/advertising (0.6 percent) showed improvement in ad spending during the month.