There are six reasons why any magazine that has a subscription circulation of some size should immediately produce a branded app for the magazine which is for sale in iTunes.
- A branded app for a consumer magazine that goes into iTunes and sells subscriptions at a ‘normal’ rate will generate additional revenues equivalent to 5%-15% of the current print subscription revenues. Not having your magazine in iTunes is for the standard UK consumer magazine as perverse as not having your magazine in WH Smith.
- Apple charges a 30% commission, but it is contingent on success and any consumer-oriented magazine will find additional revenues through iTunes and these revenues are almost entirely non-substitutional. Very, very few iPad app subscriptions will be bought at the expense of a print cancellation. The substitution effect is the other way round. If you have a consumer magazine that is not in iTunes and your competitor is in iTunes, then there is every likelihood that your competitor magazine will be the one bought by the growing proportion of your audience that is splashing out on iPads. Month by month.
- The deal is also completely non-exclusive. There is no reason not to sell through Apple iTunes when you can also sell through the web, or sell via Amazon. There is no point in doing a deal with iTunes or an iOS developer that ties your hands in any way (for the record, all Exact Editions deals are entirely non-exclusive).
- Some iTunes apps are a heck of a lot of work, but there are also solutions such as the Exact Editions platform where the production of the digital edition, and the app, is entirely non-disruptive. There is no need to employ additional staff or design multiple digital variants of the core offering. We can leave for another day, the thorny question of whether it is a good idea to produce 3, 4, 6 different digital versions of the same magazine. Such extravagant and time-consuming solutions have been remarkably attractive to some magazine publishers. But they certainly are not necessary.
- The revenues from iTunes newsstand are already interesting for magazine publishers and the good news is that they are steadily getting better. It seems quite likely that they will grow in line with the iPad user base, which is still growing at over 50% pa. About what other magazine market segment can this be said?
- The success of the iTunes newsstand is in large part down to the efficiency and ease of purchase in the iTunes subscriptions. Especially the low-cost, automatic renewals for which most subscribers are willing to sign up. Renewals through this service are excellent and a publisher who starts now will be better off in a year’s time than a publisher who starts his subscription drive in 6 months. The simple fact is that subscriptions have momentum and they take time to build up. This is the best possible reason to start your magazines iTunes subs now, rather than in November.
Tally ho! Any consumer magazine publisher who wants to increase his/her subscription revenues by 10% or more in the second half of 2006, should sign up to the Exact Editions free trial service here.