Auto Magazines filed Bankruptcy

It's the latest rage!

 

The same problem seem to apply to Radio stations, how often has your local radio station with out 6 yacky DJs in the morning, grown or been bought out , and you get the same top ten songs every hour, and more ads than music. I can sopt a clear chanel station any where in the US, the format sounds the same as the Mpls area station, just plug in 6 different yacky DJs.

 

I WAS a magazine junkie but you know what? NONE of those websites are in my favorites. That is how badly they have done it.

 

Man, as a print LUBBER, I HATE that the "can't take it into the schitter" is most guys argument.
haha

 

What has happened with Source Interlink is that Citibank and JP Morgan have converted the dept into equity taking the company private and the BK will probably last 30-45 days during a restructure. Hopefully through this they will eliminate the redundant titles and improve the magazine quality and ethics and offer a reasonable ROI for the advertisers. And as one who has advertised in print media for over 30 years I can tell you that it is track able to some extent, I have followed sales increases and spikes related to ads for years. Can the cost overcome the return? Absolutely, but there still is considerable value to print advertising to be had if you play it smart.

 

Maybe that's why they are printing them on toilet paper!


"Lord I apologize- But that's funny right there!"- as stolen from Larry the Cable Guy

 

All i gotta say is..I havent bought a Magazine..since I joined the HAMB..
they can do the math

 

I think this is natures big enema that will wash out the crap stuff and leave behind those that have stuck to the core values of what they do.

The top needs to be trimmed and now is the chance to weed out the weak sucks and reset the compass on this wayward ship. No more mutiple mags of the same crap would be great. I think with the right people and goals, print and the net can co-exist and actually help each other out.

Next thing to get the big flush should be T.V. Car Shows. Bull Run, really?

 

the guys running the ads are getting ad money from parts companies used in the ad,thats been done for years

 

Those are big businesses run by successfull business people.
Bankrupcy to a corporation is just a way to save a buck or two, face it if I owe a million and all at once don't have to pay the interest on the debt then all I owe is a million. Not a million+.

Sometimes to stay in bussiness you have to give the appearance of going out of business.

That said Ryan is right you can't depend on your sponsors to keep you afloat and stay true to your readers. If you don't stay true to your readers you won't stay afloat.

 

ANOTHER CLASSIC BUSINESS MODEL
Yes, the publishing business is like other industries we know. A "primary" company is owned by a parent company who is in turn owned by an even larger parent company and so on up the line... The "primary" company, who actually makes a product, may actually make "profit" to keep the doors open and pay the employees. You know, the "classic business model". Now comes the predatory parent company and they demand even larger numbers to fit in their portfolio and increase stock value, (Wall Street again),etc. So if the numbers are not great enough, the "parents" slam the operation and sell off the pieces and/or move production off shore. Our recent and classic example is Vise Grip (owned by Irwin Tool and Irwin Tool owned by the "Rubbermaid" group) going to China. The employees are flushed, the local economies depressed BUT corporate makes good. Boss probably even got a bonus?

And by the way! How many of the 300+ Vise Grip employees in small town Nebraska who got flushed this fall now have jobs? How many are unemployed? How many have moved away? And how many are just pissed!
I wonder......

 

OK, I'm an old guy and I love the printed word. There was an editorial I read this morning by Leonard Pitts... If you find this whole topic interesting, you'll find this a good read..
.http://www.miamiherald.com/living/columnists/leonard-pitts/story/1022778.html

 

Too bad..

Seems to me, these people have fucked up a meduim I deeply cared about.

Unless its just that my tastes have changed.

But I doubt it...

I still get excited if I find an old issue that I didn't have in my collection yet.

 

Thats nuts. I was in Walgreens the other day browsing the mags as my gal was shopping and they had printed out little signs that said they would no longer be stocking most of our favorite magazines due to print issues. This explains it all. WOW

 

I think we are living in a time of economic Darwinism. This thread could be about several industries right now, and many of the more salient points would be valid. Print media is not going away anymore than automobile manufacturing is. But they (and a lot of other industries) are going to look a lot different than they did a few short years ago.

 

It needs a Magic Slate right now... a big Reset button.
They sell subscriptions for less than it costs to mail the magazine to the reader. They're eating part of the postage, and all of the printing/shipping/handling for every single subscriber.
The theory is that they leverage large subscriber bases to charge their advertisers more, being able to say "See, we put your ad in front of X-many people each." At some point, the backs of the advertisers are breaking. The downturn in the economy screwed everybody. When people aren't buying product, that trickles up to producers not buying ads.
I have several friends (and over ten years in the industry; tech ed, managing ed, editor, freelancer and 3 years in marketing for YearOne) and advertising absolutely makes a difference. Your individual company's advertising strategy needs to fit you. I know two guys that stopped going to shows: one didn't get any business from it, the other figured out all he did was delivered parts to people to save them shipping. Another company cut back on going to shows, and everyone thought they went out of business.
Which is another point: I hadn't thought of PAW in a looooong time. I don't see their ads any more, and they dropped completely out of my mind. I've been shopping for parts and buying stuff more than I ever used to, and I've been doing it at Jegs and Summit.
I know guys that have told me when they stop advertising in mags, their phone stops ringing.

I used to work for Dobbs Publishing: their internet presence was perfect; the site promoted their core product--magazines. Showed what was in the current issue without giving the whole thing away, and on every page there was a button that said "Click here to subscribe." And then they sold a subscription for a reasonable price that was profitable. When we got bought by Petersen (then Emap, then KIII,) they were convinced the Internet was the cutting edge and everything was going that way. They had VPs and publishers there whose job was to make the internet site profitable, and they worked very hard to make the internet the focus of the business, using the print magazines to support it. Results were predictable, but only if you weren't one of the executives fighting to make money out of electrons rather than tangible goods.

Since then, the company has been bought and sold several times--and every time a new buyer comes in, they cut cut cut to try and make things profitable to get a quicker return on their investment. Then they sell, make a profit because the books look good, and the next guy (who paid too much), cuts cuts cuts expenses to get a quicker return on their investment. Three or four cycles of this, and you get where they are now. But it's not limited to Source; look at Chrysler--same thing happened there.

Since they owe me money for stories, I made it a point of calling their "Bat Line" yesterday to get some answers. What they said (and what's on their site) is this:
Business as usual. They have the money to continue paying vendors, suppliers, payroll, etc. No checks have been frozen (but I still pulled the cash from the last check out of my bank), and they will continue sending checks out.
The plan is to emerge from this as a private company, shedding $1Billion in debt. I don't know who they owe $1B to, but all common stock is now canceled. Someone is going to take it in the shorts.

Though nobody asked me how to fix it, I think a big portion of their plan to be successful should include getting rid of the blogs and dedicated web-only content, and convert it to an online archive of old tech stories. Tease current issues and drive people to the news stand to pick it up. Have a "Subscribe Now" button on every page.
Get back to their core business of producing a magazine, and stop spending/wasting resources trying to get money from electrons. Use the web to SUPPORT what makes their money. Here in the South, they call that "You dance with who brung ya."

And stop selling year-long subscriptions for 87 cents an issue. Bleeding to death by a million cuts is no way to go through life.

Do that, and they'll be able to bring their ad rates down to something a little more reasonable again, and companies will be able to afford to be in the magazines again, whether it be big like PAW, or small like "Sam's Only Camaro Widget."

-Brad

 

I repeat............

 

From a trul reliable source- This is being done to restructure their debt. Many employees (writers) Are being laid off but re hired as freelancers- a paycheck - but no bennies.

They should survive- its just to get rid of bad debt that happened over the years.
Cross your fingers guys.

 

It's all good, Ryan, I think it's just different approaches. I happen to agree with most of what you say, I guess that sometimes it's just in the delivery.....

 

Take it to the web! Nobody reads hardcopy anyway. They just look at the pics.

 

I've read this whole thread and I must agree with Ryan in being excited about the possibilities of better magazines. For years, the car magazines I buy have been crap but publishers were making a lot of money so they didn't bother to make them any better. Why would they? I've recycled most of the magazines I got over the last 20 years. Not many were worth saving.

Now this publisher is filing for bankruptcy to become a private company. The shareholders are getting screwed but this seems like another attempt to continue to make a lot of money by producing crap magazines. Sure there may be a few less titles in the immediate future but I don't anticipate the magazines getting any better just like I don't anticipate the banking industry straightening itself out. It hasn't been painful enough for them yet. No industry is going to change by itself without desperation entering the picture. Just look at the US auto industry.

What I am hoping for is that the great writers, photographers, and publishers will move out from under the corporate umbrellas and start their own magazines. With digital printing and other modern developments you don't need as much of an investment to print a magazine. I buy Rolls and Pleats and Magneto when I see them and they are always worth the money.

Like all the specialized cable channels we have now, instead of the few networks, I see many more independent and unique magazines in the future and less of the gigantic, monolithic magazines that try to appeal to everyone and no one. That has me excited.

 

Agreed! Same with newspapers and any business, really.
We'll all ride this out and come out better and leaner. Just like exersizing a fat bloated economy.

 

I agree in the fact that this will definitely thin the herd and leave those with a strong readership following to pickup where the rest have failed. It's going to be interesting to see what publications with look like in let's say 2-3 years from now. I work in publishing and because our titles are a niche market we are not seeing the same trends that others are following.

 

Ryan, I hope you're right about R&C. I've seen it come and go too many times already.

 

A prime example are the Yellow Pages-huge cost for returns. At our vet hospital,we track where our new clients come from and we got really few from local Yellow Pages and even fewer from outlying regions. We've cut the number of books we're in and cut our big ads down to just our name and doctors. What does work for us is referrals by existing clients-we initially did gift certificates to area businesses.Now we give gift cards to our kennel and store. Word of mouth is always best.

 

This is straight from the horse's mouth to their advertisers. Note what I have highlighted.

April 28, 2009
Dear Valued Advertiser,

As a valuable member of our team and partner in our business, I felt it was vital that you hear from me personally about an important Company announcement.

On Tuesday, we announced that we had reached a very favorable agreement with our lenders to privatize the company and cancel nearly $1 billion of our existing debt. The agreement follows proactive management actions taken over the last six months to right-size our operations - saving more than $50 million a year in expense. This is great news for Source and our business partners.

I can assure you that this will have absolutely no impact on you achieving your advertising goals with us. Our products that you advertise within will remain the same. The editorial and sales people you interact with will remain unchanged as will the remainder of our employees.

The processes for placing ads will remain the same as will pricing. Publishing dates, newsstand and subscription circulation can continue to be counted on with no disruption to our customers.

During the reorganization, our daily operations will continue as usual, and all aspects of the business will go on as before the filing. I and the rest of the management team are committed to the long-term future of Source Interlink.

It is business as usual!

On behalf of our entire management team, I'd like to thank you for your continued support. Be assured that we will do all we can to keep you fully informed of developments relating to our reorganization process. If you have any questions, please call (800) 497-5587.

Sincerely,

Greg Mays
Chairman and Chief Executive Officer


Steve Parr
President, Source Interlink Media

 

I'd like to preface my comments by noting that I'm just an Injection molding/engineering manufacturer, so I don't know a lot about the inside workings of advertisers and magazines. OK
To me, and it would seem plenty of others, the idea of taking money from an advertiser and having a glowing review/install/test of that advertisers product seems to be a huge conflict of interest. The conflict is that instead of serving the reader, who should be the top interest, the magazine is serving the advertisers. This is completely backward.

Add to this the fact that anyone with a pulse is smart enough to realize that the 'review' of a part might just be a little slanted and you've turned people off completely.

For me, this is exactly why places like the HAMB are so valuable. There is very little corporate BS to deal with. People will call you out if you are full of BS. If a product is not good, they will tell you. Sometimes you find the opinions split about 50/50,on a product or service, other times opinions about a product or service are overwhelmingly one way or the other. Either way, these are real people giving real world 'reviews' that haven't been swayed by the almighty dollar.

It is time for magazines to innovate in order to survive. It's a fact of life in every facet of industry. I should know, as I'm part of a small but thriving manufacturing company in MICHIGAN of all places. Everyone around is too busy decrying manufacturing as being dead instead of finding a way to make it work. These magazines will need to find a way to make it work.

There are magazines that I like and even the titles that pull the BS 'reviews' often have some good content. They just have to regain trust and offer a product that people want.

SO that's a dumb manufacturing guy's take on it.

Scott

 

Yeah, but do people really believe them? It's damage control. Where was their loyalty to advertisers that spent money for years? When their advertisers ran into hard times and had to pull ads in order to save their companies, then the editors were ordered you can not use, mention or feature parts from company X because they pulled their ads.

After the restructure the same people are still going to be in charge. Will things really get better?

 

Chin up Mikey! I remember when you were eating Mac N Cheese before, things will get better!