IS YOUR WEB SITE Stealing YOUR READERS?

Some smaller niche titles are taking precautions to avoid cannibalization of their print products on the Web. But overall, the Net is boosting rather than eclipsing subscription sales.

Why buy the magazine if you get the Web site for free? As more and more Americans get connected, the fear that content-rich Web sites might eclipse a magazine's paid reader base has been raised anew. Most industry observers say the concerns still hold no significant weight, but some titles have taken steps to ensure their sites are used to build brand awareness and subscribers, and not simply to give away the product.

Thomas Masterson, Business Week's vice president of consumer marketing and circulation, offeres what's been a mantra among industry leaders: a strong, content-rich Web site is more likely to bring new readers to the magazine than to cannibalize subscriptions.

"Our site has been a great source of new readers, which is something we've been tracking since Business Week Online was launched," says Masterson. "It's allowed us a new avenue to market our content to potential readers of the magazine, and by providing quite a bit of original content for the site that doesn't appear in the magazine, we're able to also market the site to existing readers of the magazine."

Michael Rogers, vice president and general manager of Newsweek Interactive and an editor of Newsweek, says if anything is being cannibalized by rich-content magazine Web sites, it's public libraries.

"Being able to read a magazine without paying for it is not new, and being able to read a magazine's archives without paying for them is not new, says Rogers. "Both have always been possible in the periodicals section of your local library.

"What the new technology has done is taken that ability and brought it directly and conveniently into millions of homes, and it's been a wonderful thing for the industry," he adds. "But just as no one worried about public libraries causing people to stop subscribing to magazines, I don't think that should be a major concern with the Web. Its effect has been overwhelmingly positive in opening up new revenue streams for publications, and bringing new readers into the fold."

Perhaps not surprisingly, the tendency of sites to build subscription sales rather than knock them down has been particularly evident among those titles serving the business and technology sectors that appeal most to online users.

At Forbes.com, for example, content from three separate Forbes titles--Forbes, Forbes ASAP and Forbes FYI--is combined with original Web-only content to introduce both new and existing readers to all three magazines.

Bruce Rogers, vice president of marketing for Forbes, says at least half of new subscribers to all three titles have come either from Web enrollments or email marketing within the past two years.

"Interest in investment and markets has grown exponentially over the past 10 years, and the Web has become the major way of getting that information to consumers. That's where our new readers for the print titles are all coming from," says Rogers. "It's been a major boon to us and to our ability to publish ASAP and FYI without needing to do very much else to build awareness of them."

However, the use of the Web to build print brands hasn't been limited to New Economy titles or A-list consumer magazines. For Reason, a 30-year-old, non-profit, 50,000-circulation political opinion title based in Los Angeles, the Web has helped earn the magazine respect and name-recognition it didn't have before the advent of the Web.

"In the print world, we've always been seen as a marginal little magazine with a tiny cult following, but according to the tracking surveys of groups like DoubleClick, we're in the Top 10 most clicked/trafficked political sites on the Web," says Reason founder and chairman Robert Poole. "That's allowed us to place our editors on the Sunday morning opinion shows and other venues like that with more regularity," he says.

"Unfortunately, no, it hasn't meant a major spike in subscriptions yet. But it has meant more people are paying attention to us and so, even if putting all our content on the Web means we aren't necessarily getting every subscriber we possibly could, the benefits have far outweighed any minor drawbacks."

Print Persists

Still, some industry observers are surprised that widespread subscription cannibalization hasn't taken root.

"I have to admit, five years ago I expected at this point you'd see a lot more subscribers giving up paying for print versions of magazines in favor of the Web," says Bill Glavin, chairman of the Magazine Studies department at Syracuse University's Newhouse School (named after Advance Publications chairman S.I. Newhouse).

"It's difficult to understand why there hasn't been more of it, and whether it's due more to just different audiences between print and the Web, or whether there's still something important about the tactile look and feel of a publication," says Glavin.

Tom Burke, director of Conde Nast's consumer marketing database agrees. "If you want to read an in-depth article, it's easier in a magazine than it is with a bunch of screens on the Web," he says. "People still don't look at the Web as a replacement for a magazine."

Nonetheless, Glavin thinks subscription cannibalization, even if it were happening, wouldn't necessarily be the crushing blow many in the industry seem to fear.

"In the end, even if you're losing subscribers to your Web site, you still have their attention, and you save on the costs of print and distribution while still bringing advertisers to them--and that remains the bread and butter of this industry," he says. "No one wants to see magazines completely replaced by the Web, and that's not going to happen, but even if there were, at some point, a migration from print to online, publishers should still fear losing their audience to competitors a lot more than losing their audience to the Web."

But in rare instances, the migration of subscribers from print to online has spurred a decision to move away from offering a free, content-rich site. Take Isomedia's Shadis, a 5,000-circulation title specializing in historical role-playing.

Marcelo Figueroa, director of marketing and advertising for Shadis, says the magazine initially launched a free site in 1995. The site catalogued all of its print content, but quickly found itself deluged with cancellations from subscribers who discovered the site and decided they no longer wanted to pay the $25 annual subscription fee.

"We're not big enough to be able to afford to lose a single subscriber, and so it became something we had to be concerned about," says Figueroa.

But rather than ditching the Web altogether, or switching to a pay-site, Shadis joined MagWeb, a consortium that bundles online content from 75 small publications, all focused on role-playing games like Dungeons & Dragons. Visitors to MagWeb.com are asked to pay an annual fee of $60, or alternatively, $20 a month, for secure access to articles from any of the MagWeb participants. Subscriber fees are then shared among all participants, with a commission going to the MagWeb hosting service, Coalition Web, based in Lambertville, New Jersey.

The MagWeb model is one Figueroa says could apply to other titles in small niche markets. "The big guys can count on readers still wanting to subscribe even if they can get the same content online, but many of the smaller books find that a lot harder to keep going," he says. "This is a nice compromise, where you still have a Web presence and can use it to market yourself and introduce people to your site, but you aren't totally giving away the farm."

Some publications have gone the extra mile to view their Web and print products as two separate animals, with unique audiences and unique means of presenting content. At Red Herring, although content of the print publication and the RedHerring.com site does overlap, the editorial focus of each product is starkly different.

"Each medium helps determine what its focus should be, and for our Web site, that focus is providing the most timely news for investors and people who are in the industry, while the magazine is focused more on trends-type news and analysis," said June Sargent, consumer marketing director for Red Herring. "There's content from the magazine on the Web site, and vice versa, but the audiences for each are not very often the same people. We see that with those who subscribe to our e-mail newsletters or fill out other marketing surveys. Usually, the ones who respond to the Web site are folks we don't know. We don't have them as current or former subscribers to the magazine. And so instead of losing readership, we now have new people to market to."

Fine-tuning The Overlap

Yet other titles take pains to safeguard against cannibalization. At Spin.com, one of the more popular Web sites among the 14- to 25-year old demographic coveted by advertisers, only a handful of stories from the print version are posted on the Web each month.

"We have a large overlap in that our [print] subscribers also visit our Web site, though there are many who visit the site who never subscribe," says Adrienne D'Amato, a spokesperson for Spin/Vibe Ventures. "They seem to appreciate the original content we produce for the site, and we're certainly happy with the business our site does. But if we posted all of the magazine's content to the site, would they still buy the magazine? It's hard to say, but this is the MP3 generation, so I think it would be a legitimate concern.

One way magazines avoid cannibalization is by limiting site archives to current subscribers. "We want people to visit our site, but we also want them to subscribe to the magazine, and of course to patronize the advertisers from both," says Business Week's Masterson. "So by offering our Web archives only to subscribers, we continue to maintain a greater incentive to become a subscriber. It's not meant to be a penalty for Web suffers who don't subscribe, but it does cost time, money and space to maintain an archive, and we look at it as a reward to our subscribers who've shown loyalty to us by providing them this service."

Tracking Readers

Another frequent safeguard has been the use of various sorts of e-mail registration systems to both track who is using the site, and to build the amount of information they have about existing or potential readers.

"One of the most popular features of our site is our message boards and interactive communities, and we ask users to register with an e-mail address before they log in," said Bill Stutzman, director of Entertainment Weekly's EW.com.

"The way things have evolved, having that e-mail address means we've obtained consumer information, which has real value," Stutzman says. "In the end, then, if that means that some of our users find they prefer our site to the print version, we still can say we haven't really lost anything at all in the exchange."

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