The declining magazine industry, like the rest of the world, seems to think that the iPhone App Store — and the forthcoming Apple tablet — will be able to help soften its downfall. (Condé Nast was supposedly scheduled to see a tablet last week!) But so far, it seems to be a slow start.
After a few days of sales, neither the January issue of GQ (featuring a near-naked Rihanna), nor the January issue of Esquire are in Apple’s list of the top 100 best-selling paid apps in the App Store. (Each costs $2.99.) Nor is either in Apple’s list of the highest-grossing apps, which sorts by revenue generated (versus strictly unit sales).
This suggests that sales are modest. More supporting evidence: Just three reviews for the Esquire app, including one from the developer explaining that an update to fix crashes is on the way, and one (positive) review for the GQ app.
Surprising? No. To crack the top-100 list of paid apps, you need to sell more than 1,000 units a day — maybe closer to 1,500 by now, based on iPhone app maker Tap Tap Tap’s sales charts for one of its apps. (We assume most of its “worldwide” sales are in the U.S.)
But most magazines don’t sell 1,000 copies a day. This time last year, Esquire was only selling about 17,500 newsstand issues per month, and GQ about 39,000 newsstand issues per month, according to a WWD article. Assume those numbers are flat to down this year. So even if the iPhone were to suddenly gobble up a huge percentage of newsstand sales — which it won’t — it’s not hard to see why the magazines aren’t showing up in iTunes bestseller lists.
For now, magazine companies are probably most interested in figuring out formatting, pricing, the production process, ads, and other challenges.
But eventually, they’re going to want to sell a bunch of apps to make money off e-reader gadgets — ideally, incremental to print sales. So let’s run down a few of the immediate issues: The apps are too expensive, aren’t getting any promotion from Apple, and probably beg for a bigger screen.
Pricing. Most “trinket” apps cost $0.99 or are free. The apps that can fetch $2.99 are either relatively useful utiities or relatively decent games (Battleship, Where’s Waldo, Tetris, Bejeweled). Magazines — which are typically read once, throw away — will have a hard time fetching more than $0.99 on the App Store in high volume (even, apparently, with near-naked Rihanna pics).
There are plenty of pricing options we expect the publishers to experiment with — perhaps a ~$10-15/year subscription, similar to print. Or even free iPhone apps with paid print subscriptions, so publishers don’t have to share more revenue with Apple and can continue to own the billing relationship with customers.
But $2.99 one-off apps won’t do much to boost circulation or revenue.
Promotion. Unless we missed it, neither magazine is in Apple’s featured “new” section on the App Store. This is where Apple puts new, notable apps, and it’s one of a few places on the App Store that can drive sales. (The top-25 apps listing is the biggest. GQ‘s month-old December issue made it to the “what’s hot” listing.)
Buying a magazine — at least our experience with buying print magazines — falls into two categories: Either a planned purchase, in a reduced-cost subscription, or an impulse purchase at a grocery store checkout counter or airport bookstore. If Apple is going to pitch itself as an ally for publishing companies, it should try to help with both of those. (Assuming that people will think of buying iPhone magazines the same way they do print; that could be a flawed assumption.)
We assume subscription offerings are on the way. But the grocery store impulse-purchase rack still needs some thought.
Perhaps there are plans for a heavily promoted “magazines” section once the tablet rolls out, the sort of supermarket endcap near the register. But it’s clear that just being on the App Store — and getting a bit of press coverage for being there — isn’t driving absurd sales.
Screen size. While we love reading books on our iPhone, magazines — which we enjoy offline as much for their photos as for their text — probably need a bigger screen. The small iPhone screen is good for text, but not great for admiring photos.
So if this Apple tablet is real, perhaps that will be better suited for magazines. And we imagine Apple has a plan to take media companies’ money for that device, as well.