Why Newspaper Magazines Fail, But "WSJ." Will Succeed

(MoneyWatch) 
If Rupert Murdoch thinks print publications aren't a good business, he's doing a pretty good job of misleading the rest of us. After all, his Wall Street Journal has just announced the debut of a glossy lifestyle magazine today.

It's called WSJ., and according to the company, it will launch on Friday, September 5, inside The Wall Street Journal Asia and The Wall Street Journal Europe; and then on Saturday, September 6, in the U.S. Weekend Edition of the Journal.

The magazine, which has a global circulation of 960,000, (800,000 U.S., and 160,000 overseas) will will focus on cars, fashion, property, philanthropy, personalities and travel. At first it will be a quarterly, but next year it is scheduled to become a monthly.

The 104-page premiere issue of WSJ. in the U.S. (80 pages in the Europe and Asia editions) is launching with 51 advertisers, over 37 percent of which (19) represent new accounts. This, of course, is the key reason newspapers create magazines -- to attract more advertising accounts than their traditional newsprint products can get on their own.

Throughout the newspaper business generally, however, the ad sales teams have been slow to develop the contacts or skills to book new advertisers. This requires a completely different approach from selling newspaper ads, which are almost always local, consistent, and heavily geared toward retail "sales."

Magazines present several opportunities that may seem alien to newspaper business plans. First, the publisher can, if it desires, target certain zip codes (i.e., demographic groups) for the magazine, which typically is pitched to appeal to upscale consumers (as opposed to Target shoppers.)

Fashion drives a lot of the advertising in these magazines. Women can often outnumber men as readers. (By contrast, men always form the majority of news readers.) Most importantly, national and regional advertisers will buy space in glossy magazines that they would never purchase in a newsprint product -- and at far higher page rates.

For all of these, and other, reasons, most newspaper companies fail miserably when they launch magazine inserts. Not so Murdoch's venture. His company has the sales force in place and the distribution power to succeed, and that is exactly what it will do.