The Association of German Magazine Publishers held its Publishers' Summit last week in Berlin. In an interview, Philipp Welte, a management board member of family-run Hubert Burda Media, one of the country's largest media companies, made no secret of his annoyance at those bemoaning the state of the industry.
Mr. Welte, is weekly Focus magazine still the journalistic flagship of the Burda publishing house?
From a journalistic point of view it is one of our most important titles in a very strong portfolio – and still our biggest advertising medium. Focus is a byword for high journalistic quality.
But the turnover of editors-in-chief there is very high. Ulrich Reitz is the fifth in the last four years. What’s going wrong?
Nothing at all, but the job is anything but trivial. Focus was launched more than 20 years ago as a news magazine and was very successful becasue of its strong news flow. That was embodied by the famous quote of the first editor-in-chief, Helmut Markwort: “Facts, facts, facts.”
This core brand is rapidly disappearing in the digital age. A news item as such simply doesn’t have enough shelf life. What we need in the future, therefore, are substantial stories which reach and reassure readers in their living environment. To do this, Focus goes in a different direction to our competitors, for example Der Spiegel, which is at pains to reassure its readers of its more left-leaning liberal view of the world.
From 2015, Focus will be on the news stands on Saturdays instead of Mondays, like Der Spiegel. That will require more than just a different kind of story – you’ll be encroaching on the territory of Sunday newspapers.
Competition at the weekend is completely different, much tougher than on Mondays. And it serves other interests, because the reader above all wants to be entertained at the weekend. From January, there will be Focus and Der Spiegel on Saturdays and on Sundays the big Sunday newspapers. It will be crowded. Not an easy job, but an exciting one.
Gruner + Jahr, Europe’s second largest publisher, recently announced that Brigitte, the fortnightly women’s magazine, would be produced in future without any copy editors. Would that be conceivable in your company?
It’s up to everyone to find their own way, but it wouldn’t work for us. We will all have to get used to working differently. There are more than 1,000 journalists working just for Burda’s publishing business in Germany today, and they are our guarantors of high quality content, as the foundation of our business concept. We have to maintain this foundation.
In general these days, though, our industry seems to quite like the morose body language it has adopted. The reason is the simple realization of reality: Digitalization has been tantamount to a banishment from paradise.
The paradise of high advertising revenues?
Until not too long ago, publishers lived on two powerful revenue streams – advertising and newspaper sales. Publishing houses grew up in a world where there was a shortage of information, a shortage of entertainment and a shortage of advertising opportunities. It was wonderful: If advertising and newspaper sales streams were the Tigris and Euphrates respectively, we lived in Mesopotamia with returns on revenue of 30 to 40 percent.
Those days are long gone – some five or six years ago – but average returns on revenue are still double-digit. Yet still many of us are acting as if the demise of our industry is imminent. We are even talking down our own products. Realizing our own potential mortality – itself an engine of the market economy – is obviously something completely new for publishing houses. Unfortunately, many are reacting with panic rather than systematic reorientation.
Circulation, revenues, profits – those figures are in decline everywhere.
Many of us have always understood our magazines primarily as advertising media, but they are not. They are primarily made for readers, for human beings, who are enthusiastic about our magazines and their content. Burda is doing so well because in Germany alone we sell 340 million magazines annually.
That is the foundation on which we stand: People love our magazines. And that is also the strength of our entire industry – we sell over 2.5 billion magazines annually in Germany. This fundamental strength does not disappear simply because the advertising market is in the throes of a profound transformation. But we are acting as if it was all about to end.