The publication industry is struggling. The recession and growth of the web is shrinking advertising revenues and increasing fears about the future of printed publications. On-line advertising such as craigslist continues to undermine the newspaper business. Similarly, we can ask what will happen to the trade magazines?
The best way to analyze this question is to understand how trade magazines make money. Manufacturers pay trade magazines to persuade buyers to consider manufacturer's products. Historically this has been very attractive to manufacturers as there were few other options (direct sales, channel sales and trade shows). Advertising and sponsorship of trade magazines was one of the most economical and inexpensive ways of reaching buyers.
Here's what I think is/will happen:
- The Internet provides many more options for manufacturers to reach buyers
- Increased alternatives (greater supply) will drop prices paid by manufacturers
- Lower prices will force some trade magazines out of business
- Remaining magazines will become larger and more global
- Magazines will offer less original content and limited social networking
More Options for Manufacturers
Today, manufacturers can reach dealers/end users by issuing their own on-line Press Release, getting search results from Google, advertising on Google, and placing targeted ads on networks liked LinkedIn. This provides dramatically more options than a decade ago.
This shift has made manufacturers less dependent on trade magazine coverage/advertising and more open to use low cost alternatives.
One recent example is the emergence of
LinkedIn ads. For 2 cents per view, you can target ads to security executives only (or other targeted niches). Plus, you can start with as little as $25 USD. In the past, the only way you could do that would be to use a trade magazine.
Another example is Google ads/Google search results. Let's say you are a wireless video surveillance company. You can pay for ads or optimize your search results so that your listing comes up for people searching for specific wireless related phrases (e.g. "mesh video surveillance", etc.). This is something that's not possible with general display ads.
Greater Supply Decreases Prices
Like in any market, the more suppliers, the lower prices will be. In the old days, trade magazines really only had to compete with other trade magazines. Today, trade magazines compete with Google, LinkedIn, doing your own press releases, etc. This is similar to the problem newspapers face with Craigslist.
Forcing Trade Magazines Out of Business
Because competition was constrained in the past, trade magazines really only competed with each other and then only within their own geographical regions. Now, with new competitors and lower prices on the web, total trade magazine revenues will decline. Becaue of this, some magazines will be forced out of the market.
Remaining Magazines Larger
I expect the remaining trade magazines to become larger. The global reach of the Internet will make that much easier as it eliminates the cost constraints of mailing publications and finding new subscribers around the world. Additionally, trade magazines will need to become larger to offset declining ad sales.
Instead of the few dozen security magazines currently, I would expect to see a fraction of them remain but of much larger size and global coverage.
Magazine Offer Less Original Content and Limited Social Networking
The three big trends in online content are:
- Lots of posts with short comments and links
- Investigative Reporting / unique analysis
- Social networking
Of these, I think the first approach (lots of short posts) is most likely to be adopted by security trade magazines. The reason for this is that it is inexpensive to produce and can generate high traffic. While none of the trade magazines do this currently, it's a natural and proven way to generate traffic (examples include business publications like
Business Insider to gossip mags like
Perez Hilton). As generating revenue from the web becomes more critical, expect to see this more widely adopted.
Investigative reporting certainly drives traffic but the expense in its production will make it hard to justify. Finally, social networking will become more important but it will be difficult for magazines to build up a membership base. I expect that LinkedIn groups will become the social networking hub for most business segments including security [for examples, see the
Security Industry group and the
IP Video Market Info group].
Conclusion
While I think trade magazines will continue to play a valuable role in helping manufacturers market their products, the emergence of various alternatives will force consolidation and changes among security trade magazines.
