Online sub sourcing no panacea, says Capell

It's a classic case of good news, bad news:

• More magazines are selling more subscriptions online than ever before, but the phenomenon seems to have peaked;
• Most subs come through the publishers own websites, but in order for online sourcing to grow, more reliance will have to be put on other people's sites, where payup is a problem

This, according to a story in MediaWeek, quoting circulation guru Dan Capell, editor of Capell's Circulation Report (available only by subscription).

“Most people think we’ve hit the peak,” said Capell, who has been surveying 100 to 150 magazine circ directors per year over the past decade. “The quality of orders has not been great. The pay-up rate and renewal rate have not been up to par.” For the past three years, internet subs have stayed around 10 per cent of new orders up from 7 per cent five years ago.

Some publishers are besting the average, said the story. For instance, Hearst magazines get nearly 15 per cent of their subs through online sources. Rodale expects to get a 500,000 new (net paid) subs from online sources this year—representing 10 percent of all new subs—and is setting its sights on hitting 18 percent by the end of 2008.

In the end, selling magazines online is subject to the challenges of selling them anywhere. New, popular magazines are relatively easy to sell, no matter where, said Chip Block, a veteran publishing and circulation exec, who added that for “mature magazines with big rate bases, it’s tough to sell subscriptions or single copy through any source.”