e-commerce ELLE OF A BUSINESS


The Elle Shop in Japan, launched nearly five years ago, is growing rapidly, accounting for half of the Elle brand’s sales and 20 per cent of Hearst Fujingaho revenue and sales, according to Nicolas Floquet, managing director and COO.


“I can also mention that for a publisher, an ecommerce project can have benefits beyond the mere sale of products under our media brand. In our case, a significant share of our Elle print circulation is achieved from our ecommerce site and also joint-promotion Elle Shop/Elle magazine subscription is a good success.


“Ecommerce business also enables us to strengthen the relationship with fashion brands who are also important advertisers for the magazine.”


producing content. There is no one whose job is selling other people’s goods or their own content in new ways.


CLIFF CONNEIGHTON Senior vice president Hybris software, USA


M and ecommerce are being flagged up as exciting additional revenue streams. Do you agree? We just call it commerce – and it just means selling stuff. Magazines have two kinds of product to sell – they usually use the word “ecommerce” to mean selling their advertisers’ products or other outside products. But equally exciting is the opportunity to do a broader job selling their own products. Both represent huge additional revenue streams. A magazine’s product is its content. In the


print world, production and distribution cost realities means the product must be bundled into a weekly or monthly package that is the same for thousand or millions of readers. In the digital world, those restrictive realities are gone – a magazine can profitably sell one article at a time, or bundle articles into any number of topic-specific mini-zines, or sell collections of articles from back-issues. Economies of scale are not necessary. If one discards the model of a stack of paper stapled together once a month and distributed through the mail, the new revenue possibilities are endless.


Are there examples of successful ventures? I am not aware of anyone who has really exploited the possibilities – yet. I have spoken to several magazine presidents and CEOs who “get it” but they say their biggest obstacle is calcified organisational inertia. There are people in charge of selling ads, selling subscriptions, and


fipp.com


Are strong brands the key to success? In commerce, the most important brand a magazine needs to leverage is its own. I can’t think of any industry that “owns” their brand and an audience more than magazines. If your passion is fashion, or celebrities, or model trains, or gardening, your magazine that specialises in that topic is often the centre of that world for you. The reader has given you permission to not only convey content on the subject, but also products on that subject. Where better to buy gardening tools than from the same magazine that tells you how to use them? Accept that permission – give the readers what they want.


Retail is a risky business with low margins. How do publishers best deal with this? Magazines must avoid the logistics of retail – distribution, stock and customer service. Your job is to make the connection between what the reader desires and what the market offers. The magazine should own the ecommerce engine to control and deliver the product information and recommendations, present the offers, cross-sells, up-sells, take the order and payment, then pass the order off to someone else to fulfill and worry about logistics. There are many companies eager to do that, from manufacturers to distributors or even other retailers.


There is some formidable online competition. What can publishers offer that they can’t? That’s easy – context and content. Amazon is successful because it provides a great customer experience – they make it easy to find the product you want, order it, and it arrives on time. And they provide good product information. A magazine can easily beat all that. Want to buy the thing you just read about? Click here. You just beat Amazon on customer experience and information.


What advice would you give any publisher looking to test the waters? Pick a category (don’t try everything at once). Find a trusted provider who can deliver the product on time. Pick a commerce platform that gives you the flexibility you need to try different things and adapt your strategy over time. And get started. All the same holds true whether you are selling your own goods or others.


Is there a key strategy to employ? Just start, and be prepared to adjust as you learn.


How do you see ecommerce evolving for publishers? Selling your own content and related goods will replace advertising as the primary revenue source. It must. Here’s why: The amount of content available on the


web, written and video, which competes directly with magazines is exploding. Over 50 million new websites are launched every year, and a new picture is uploaded to Instagram every second. And most of this seeks to be supported by advertising. Meanwhile, the total spending by advertisers across all media is flat.


And new media is seeing all the growth


– YouTube generated about US$4bn in advertising revenue in 2012, more than all the titles combined of Time Inc. and a growth rate of 60 per cent over the year before. People are willing to pay for content that they are passionate about, that they find compelling, and they can’t get for free elsewhere. Paid content is inevitable.


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Over 50 million new websites are launched every year, and a new picture is uploaded to Instagram every second. Most of this seeks to be supported by advertising.


issue 82_2014 | Magazine World |17


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