Commentary

Meredith Sees 'Surprising' Rebound In Newsstand Sales, While Digital Shines

Meredith Corp.'s digital operations have been a bright spot for the publisher as advertisers seek ways to reach homebound consumers during the pandemic. With titles like People, Better Home & Gardens and Allrecipes that have a print and web presence, the media company reaches about 95% of U.S. women consumers.

One of the biggest surprises for Doug Olson, president of Meredith Magazines, has been the rebound in newsstand sales despite the 10% decline in shopping trips that help drive impulse purchases at grocery checkouts.

“Our sales in the last eight straight weeks have exceeded last year's sales at the newsstand when you look at our total portfolio," he said. "Our numbers are up a little bit compared to the prior year.”
The company hasn’t changed the frequency or production schedules for any of its titles, though special issues dedicated to topics like movie releases have been delayed as studios cope with shuttered theaters. Amid concerns about personal safety, celebrities also have been scarce.
“It's been challenging on the celebrity stuff because Hollywood was basically closed," Olson said. "It was harder to get celebrities to want to do covers for the magazines and big features in the middle of the pandemic and all the social-justice issues the country was facing. But they found ways to keep that audience focused.”
Meredith's share of total magazine media spending expanded to 36% last month from 31% in January, according to MediaRadar data cited by the publisher.
“There's been a lot of pressure on page rates and CPM and that type of thing, but we really worked closely with our advertisers to show them engagement matters and our consumers are engaged," Olson said. "We certainly had our fair share of pressure on rates, like we always do. But we really haven't had to go there because we've been able to show the consumer is willing to take some kind of action to suggest sales.”
With many homebound consumers looking for ideas on cooking meals, keeping their kids entertained and making changes to their living spaces, Meredith has seen higher web traffic and digital ad revenue as marketers ramped up spending.
In its most recently completed quarter, digital ad revenue rose 15% to $105 million, partly offsetting the 32% decline in print revenue to about $109 million from a year earlier. Digital and consumer-driven revenue rose 22% to $20.1 million, per its quarterly report, as web traffic climbed.
“Our traffic just last quarter was up 19%, and we expect that to continue to be strong," Catherine Levene, president and chief digital officer at Meredith Digital, said. "People are staying with our brands, and they're still finding so much relevant for them at this particular time.”
People  had its best quarter ever with web traffic rising 22%, while Allrecipes also saw record online visits, Levene said.

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The company has built out a database of 150 million online consumers and 40 million print consumers, collecting first-party data that is becoming more valuable as technology companies like Google and Apple implement stricter privacy measures. Google plans to end support for third-party cookie tracking in 2022, while next year, Apple is expected to change its software to notify customers when apps want to track them.
“There's multiple areas of our sites where you actually register in order to do certain things," Levene said. "With that registration, we're finding what content you're most interested in.”
Consumers are shopping online more frequently as they avoid stores, leading to 55% growth for Meredith's affiliate commerce business in the last quarter. The company saw a bigger lift as Amazon re-scheduled its yearly Prime Day shopping event to mid-October, bringing more shoppers into the market for early holiday deals.
“We had a huge Amazon Prime Day -- multiples stronger than last year," Levene said. "It was sort of an unofficial start of the holiday season, and it hasn't really slowed.”
Meredith had managed to bring back 25% of its workers to its Des Moines, Iowa, headquarters as the pandemic showed signs of being contained. But it's had to reverse that policy as the weather gets colder and cases spike in Midwestern states.
“With the cases in Iowa up significantly, we have dialed that back to just essential people," Olson said. "Yesterday, I was one of maybe 30 people in an office that holds 1,200 people.”
 
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