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					CASE STUDY
Computeractive
VNU are growing the overseas (and UK) circulation of Computeractive by offering the magazine in e-book, as well
as printed, format. Amongst a range of benefits digital publishing offers publishers the option of fast, inexpensive
and efficient delivery – especially appropriate to overseas subscribers.

Background and objectives
VNU launched Computeractive in the U.K. 1998 into a highly crowded but rather “tecchie” market targeting home
and small business PC users. The magazine was unique in that it spoke to readers in words they understood – in
fact each issue carries a “jargon buster” helping to cut through the language which is only understood by
professionals and “anoraks”. The magazine was also unique in that it carried no cover mount and sold for 99p per
copy. It was an immediate success and quickly became the market leader - where it has remained ever since.

The first edition (Dutch) of Computeractive was published locally by VNU in the Netherlands, also in 1998. In
2001 the first licensee was appointed with the right to publish the magazine in Indonesia.

As one of the world’s leading information and media companies it was natural that in 2003 VNU should be one of
the first publishers to explore the opportunities offered by digital publishing (e-books) and to ensure that they were
financially viable. As a company they’re committed to having each of their brands be leaders in their respective
markets and are dedicated to innovation in business-to-business information services, aiming to reflect and
capitalize on evolving market conditions and customer needs.

Electronic circulation offers many advantages for both UK and international distribution. Internationally it bypasses
many of the current barriers to export – production and distribution costs are low. Delivery is fast, efficient,
controllable and totally appropriate for readers of a PC magazine. English speaking people anywhere in the world
can subscribe at a rate which may be less than that of a local publication.

For UK subscribers delivery is direct and immediate - whatever their post code. A further advantage is that
storage of back issues (at home or in the workplace) is “clutter free” - offering easy access to articles and product
reviews previously published.

Digital publishing is especially attractive to producers of controlled circulation titles – overheads can be
significantly reduced whilst at the same time maintaining a tight control over their circulation base. This
inexpensive, efficient and convenient method of publishing opens the door for publishers to tightly target
audiences which (due to their size and geographic distribution) were previously cost prohibitive. Within this it also
offers a relatively inexpensive opportunity to develop and launch a special edition or one shot publication.

Development of the digital product
Having made the decision to investigate e-publishing, the first step was for VNU to find a partner. After talking
with a number of companies they teamed up with the US specialist Zinio who currently (April 05) offer 60 UK titles
as e-books (including all VNU titles). The size and brand awareness of VNU in Europe and the USA helped
considerably in their initial negotiations.

Working closely together VNU and Zinio tested the feasibility of producing and delivering a range of titles to private
and corporate addresses. It was crucial to get the technology right, especially the download time - which can be
slow. This is of special significance to non broadband subscribers where there is the added cost implication. For
corporate subscribers there is the further deterrent of “firewalls” which can deny access. This has now been
overcome by Zinio who have developed within their own function-rich software a bespoke distribution system
including a “corporate” edition.

e-books cost little to produce as the basis is the PDF that has already been created prior to printing the newsstand
version. Distribution costs are also minimal thus offering huge cover price flexibility.

One of the biggest issues facing UK publishers of e-books is that of the circulation audit. The two leading audit
bodies in the UK, the ABC and BPA Worldwide, both audit e-books but treat them in a very different way.
Although accepted as part of an ABC submission, publishers are not allowed to include e-subscriptions in their
headline circulation figure. This is a major deterrent to the growth and development of electronic publishing in the
UK. BPA on the other hand do allow e-book subscriptions within their headline circulation but few UK publishers
currently subscribe to a BPA audit, and where they do operate it’s predominantly within the business-to-business
arena.



Computeractive                                        Page1/4                                     June 2005
For this reason it’s important that a balance between print and electronic subscription is maintained, as a fall in UK
print subscriptions would detrimentally affect advertising revenue. Conversely in the USA (where this issue doesn’t
exist) Ziff Davis has successfully switched subscribers to e-books and currently has over 150,000 e-subscribers to
PC Magazine (probably the highest sales of any e-book in the USA). IDG also are aggressively promoting the
electronic version of PC World.

International subscriptions and promotions
The printed version of Computeractive has few overseas subscribers (277) and averages 656 single copy sales.
However, the e-book has already attracted 500 subscribers. The low production costs allow VNU to test different
pricing levels and packages, it’s possible that overseas subscribers to the e-book might pay less than UK
subscribers to the printed version.

From a range of options the subscriber will have a choice as to which package or “bundle” to buy. Alternatives
might include any combination of the printed and/or digital magazine + the option to receive delivery of premium
content, sms virus alerts etc.

It’s necessary to see an example of an e-book in order to fully understand the qualities it has to offer and there is a
huge educational job to be done amongst potential subscribers and advertisers, for this reason “sampling” is key.
Subscriptions to the digital Computeractive are promoted via the magazine’s own website, within the magazine
and also via standalone promotions. Their distributor Zinio offers free downloads of back issues and VNU and
Zinio together are offering e-mail samplers. These “sample issues” will be emailed to names from the VNU
database of 1.5million names along with pricing tests. VNU in the UK will also co-operate with their overseas
colleagues as part of the overall promotion. They also partner with websites that attract high traffic from potential
overseas subscribers.

Currently Computeractive has adopted a slow roll out, taking care not to jeopardise the existing UK print circulation
base. For the electronic magazine the focus is more on international rather than domestic subscriptions. Most
people are still unfamiliar with the concept of e-books and certain readers will never accept this option especially
the older ones.

Magazine content
The electronic version of Computeractive is exactly the same as the printed magazine. Each issue carries a wide
range of new product reviews including computer hardware, software, cameras, mobile phones etc. There are
reader “IT problem pages”, and “how to” features covering a broad range of activities from PC trouble shooting to
buying and selling on e-Bay. For subscribers the experience of reading the e-book is more like reading a printed
magazine than a “flat” PDF. They have the flexibility to “turn the pages” – to quickly identify the articles they wish
to prioritise and to link directly to other web based information sources.

Advertising
Advertisers are primarily buying the UK circulation of the printed magazine – they see any overseas readership as
“the icing on the cake”. However, with the help of the team at Computeractive, several have been quick to adopt
the wider creative opportunities that the e-book offers. For example in a recent edition “electronic” readers could
not only read the Orange print ad. but also view their current TV commercial. Hewlett Packard and Intel have also
exploited the multi media opportunities of electronic delivery - using rich text ads, film and click throughs to their
websites. This instant access to the advertisers’ web pages is especially attractive whenever there’s a direct
response element to their communication.

Competition
Computeractive sees its competition as everything from PC Advisor to the Sunday Times – these days computers
are such a part of everyone’s daily life that information can be sourced from a wide range of media. However, in
the category of specialist magazines Computeractive is by far the market leader selling over 100,000 copies more
than its nearest rivals PC Advisor” and PC Plus.

Staff
According to Zinio one of the biggest deterrents to the growth of electronic publishing is that no-one specifically
within a publishing house has responsibility for developing or researching the potential of digital publishing and e-
books. However within VNU the publishing teams drive e-books by identifying topics, frequency etc. The
circulation department (especially the data and electronic communications team) manage the distribution, set the
books up, and analyse performance.



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Aims and achievements:
     Through Zinio VNU Business Media Europe offer subscription to electronic magazines in 4 languages
        out of 7 countries. In the UK electronic versions of all their titles are available
     At the end of 2005 the uptake of e-books will be evaluated – analysing response to different promotions,
        varying subscription levels and overall costs. VNU will then assess future development opportunities
        and the budgeting requirements to drive forward their e-books.
     It is important that the issue with ABC is resolved and that e subscriptions are accepted as a valid
        element of headline circulation figures.
     Access to broadband is a key factor in “take up” and therefore circulation growth potential. In future it’s
        estimated that 90% of the electronic circulation will be UK based.

Development into other product areas:
VNU believe that e-books will continue to flourish, particularly in business-to-business, and will become a vital part
of all magazine publishing strategies in the future. They offer such a wide range of business solutions which are
not solely restricted to circulation. For example publishing in digital formal allows fast and efficient vouching,
archiving, internal circulation (local and international) and sampling.

VNU have adopted a media neutral approach to publishing and are exploring a wide range of delivery methods
and products linked to their titles, these include PDA and “mobile” editions of their titles.




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FACT FILE: Computeractive
Launch Date                            Computeractive magazine - UK 1998
                                       e-book - 2003
Publishing Company                     VNU Business Publications
Frequency                              Fortnightly
Circulation audited (UK & Overseas)    236,026 ABC Jan – December 2004, print
                                       500 copies e-book
Reader Profile                         Home and business small pc users – people for whom their
                                       computer is a tool rather than a focus
Editorial Profile                      Computeractive is the only plain English computer magazine
Format                                 A4 saddle stitched
Ad:Ed ratio                            70:30
Website/content                        www.computeractive.co.uk a very busy, lively site containing
                                       constantly updated news stories, product reviews, reader polls,
                                       competitions, jargon buster, software downloads, “Webstore” for
                                       purchase of back issues, related products i.e. DVDs, computer
                                       consumables etc. and subscriptions, price guide for a range of
                                       products from digital cameras to TVs
Other associated                       Computeractive is available to subscribers in printed format, digital
products/services/events               format, extracts can be viewed on their website and downloaded in a
                                       mini format for PDAs, subscribers can also receive e-mail
                                       newsletters.
Also published in                      Netherlands (1998), Italy (1999), Spain (2000)
e-book subscriber profile (500 subs)   UK          50%
                                       Ireland 15%
                                       USA         17%
                                       Australia 4%
                                       Saudi        3%
                                       Cyprus       3%
                                       Spain         3%
                                       South Africa 3%
                                       Singapore 2%

Circulation Profile UK Edition Print   UK                              Export
Circulation ABC Jan – Dec 2004         235,046                         980

Method of circulation (printed)        News trade 54%                  News trade 67%
                                       Subscription 46%                Subscription 28%
                                                                       Multiple copy subs 1%
                                                                       Free           4%
Cover Price: Single copy               UK £1.35
            Annual subscription        £25.77                          £65 - £100




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