Interactive Magazines and Newspapers To Reach $3 Billion in Subscription Sales
By Anna Johnson on August 26th, 2010Interactive magazines and newspapers are expected to attract $3 billion in subscription revenues by 2014, according to research from Oliver Wyman.
After accounting for the potential cannibalization of print subscriptions, Oliver Wyman says the publishing industry could realize $1.3 billion in incremental subscription sales from interactive periodicals.
Oliver Wyman’s research – which it conducted for Next Issue Media (the digital publishing consortium of Conde Nast, Hearst, Meredith, News Corporation and Time, Inc.) – attempted to quantify expected demand across nearly 230 periodical titles, surveying 1,800 U.S. consumers based on the likely formats and features of emerging interactive periodicals.
Since the study focused only on subscription sales – not advertising, commerce, single copy sales or other potential revenue streams – interactive periodicals are likely to generate considerably more in overall revenues.
Among the other findings of the study were that:
- Among device-owning subscribers, the overall subscription renewal rate is expected to rise from today’s 55 percent industry average to 64 percent.
- 30 percent of renewing subscribers are likely to choose a bundled print and interactive edition, at an average 33 percent premium to the stand-alone price of either.
- Automatic renewals will eliminate the traditional ‘bill-me later’ model and decrease churn from an average of 45 percent today to 25 percent.
- Uptake by device-owning non-subscribers will triple from 5 percent to 15 percent with the introduction of interactive editions in online stores, even where the price is the same as today’s print editions.
