Business titles are being forced to broaden their focus in an age defined by little good news and even smaller ad budgets.As a year of bad economic times and big business scandals draws to a close, everyone's hoping there's some good news around the corner. And not just the PR folks. Loss of advertisers and ad pages has forced business magazines to shrink staff, if not shut down altogether. That in turn - along with the decline in technology's fortunes and the rise of business scandals - has provided publications with an opportunity to rethink how they approach covering the business world. In short, it's been a return to basics, as there's little chance of hiding how bad this economy has been for the business magazines. The Publishers Information Bureau (PIB) measures the magazine industry's ad revenue on a monthly basis. For the year to date, January to September 2002, magazines tracked by PIB saw ad pages drop 7% from the same period last year, from 170,998 to 159,635 (revenue rose, but only by 1.5%). Some major business magazines, however, did even worse. For example, BusinessWeek's ad pages shrank 20%, from 2,822 to 2,251, while its ad dollars fell 18%, from $295 million to $241 million. It's a similar story at Forbes, where ad pages fell from 2,706 to 2,257 (17%) and ad dollars from $220 million to $185 million (16%), and at Fortune, which went from 2,888 to 2,310 ad pages (down 20%) and $240 million to $204 million in revenue (down 15%). Magazine-industry market correction Samir Husni, professor of journalism at the University of Mississippi, and known in the industry as Mr. Magazine, views all this as a magazine-industry market correction. "We have very short memories in this business," says Husni. "Everything is just back to normal now. Companies were overloaded with employees," he says, wondering whether many of the "e-biz" books could have continued to keep 300-odd editorial staffers on their payrolls indefinitely. Back in 2000, for the first time ever, technology overtook automotive as the top category for magazine ad buys - though it lasted only six months. The decline precipitated the closure of numerous titles. "We were all blinded by new technology and the new economy," Husni explains. "We thought we were looking at a light at the end of a tunnel, and instead we were looking at an oncoming train." That runaway train obliterated business titles such as Upside, The Industry Standard, and Forbes ASAP, and the dominos keep falling. Mutual Funds closed just this month, hot on the heels of another title, Business Ethics. "The term just became an oxymoron," says Husni, adding mention of other titles that have reoriented (Fast Company and Wired) or merged (eCompany Now and Business 2.0), or are just plain struggling (Red Herring). Rebecca McPheters, founder of McPheters & Co., a publishing-industry consultancy, says even September 11 affected readership of business magazines. "I think people shifted their focus away from business and toward other elements of their lives." However, McPheters and others still manage to be somewhat optimistic about the future. She thinks this year's fourth quarter will be "a bit better," as ad budgets for print magazines get stronger and buyers start to earmark funds for next year. It's a view shared by Alan Jurmain, executive director of media services at advertising agency Lowe Worldwide. "Hopefully, we should see things turn around a bit," he says. "What I want to believe is that there is a growing group of companies emerging that have good results." In addition to their own economic struggles, journalists at these business magazines are dealing with a new editorial atmosphere, one in which they must both cover the scandals and yet find something positive to write about. (They sense their readers are tiring of all the bad news.) Rik Kirkland, managing editor of Fortune, outlines the problem that journalists and PR executives have in common: "There is no one single meta-story at the moment. We live in a period of continued coping with the aftershocks of the bubble. The market is difficult to predict; the economic data is mixed. The question is, can business spending come back before consumer spending runs out of gas?" While some PR executives complain that journalists are overly focused on the stock market, financial results, and executive compensation, this may actually be truer of newspapers, wires, and websites. Editors at the monthly business magazines say they are consciously looking for stories that run counter to the prevailing no-news-is-good-news winds. Karen Dillon, deputy editor of Inc, the monthly aimed at budding entrepreneurs, says, "We're especially interested in 'how-I-did-it' stories about turnarounds. Our readers are entrepreneurs; they're used to dealing with difficult situations. We've had one year of depressing news. I think next year we'll be looking for more hopeful stories." Showing the softer side of business Editors like Kirkland are well aware that readers only have so much appetite for doom and gloom. His response is to offer a mix of articles that range from serious investigations to the light-hearted and fun side of business. Decidedly non-market-driven stories about Oprah Winfrey and the Rolling Stones have graced Fortune's cover in recent months. "It's very important, as you cover bad news, to also look for people who are up and coming," says Kirkland. "Give me good-news stories too. We should end the year by looking back at things that went right." When asked how the changing environment has altered Dow Jones/Hearst-owned Smart Money, editor Peter Finch says, "We've broadened our coverage to include alternatives to stocks. We are recognizing that readers are very concerned about volatility, and we're looking at ways to help them through that." Come January, the magazine is also boosting coverage of mutual funds and bonds, and will add a new car column called Driving Force. Finch adds that readers remain interested in health and real-estate stories. "Our health and wealth edition in July on new medical technologies, biotechnology, and health insurance generated a lot of interest." Business 2.0 is another title that has had to broaden its focus. The November issue looks at the art of making business decisions on a hunch. Still, editor Josh Quittner says his magazine hasn't abandoned its tech-oriented stance, despite the bad times. He says he feels Business 2.0 is offering struggling new-economy era executives alternative business models that work, just as Fortune was the magazine during the Great Depression because it offered solutions to successful people looking for a way out of that economic disaster. "You do have to tell the hard stories, but you have to have the innovative pieces as well," Quittner adds. While some PR execs say they're reluctant to give access to their senior executives because of the negative journalistic environment, Quittner says there's been little evidence of companies closing their doors to his magazine. "The difficulty of getting to the CEO has been lessened because we're the only game in town," he says, referring to the disappearance of many of Business 2.0's competitors. However, the ad decline in the tech market has clearly affected the magazine. Quittner says he feels the title is just the right size now: "Any smaller, and I wouldn't be happy." BusinessWeek, meanwhile, is giving additional prominence to its personal-finance department, as advertisers prefer sections that offer a more neutral news environment. To PR execs who say that negative business coverage is impacting the recovery of the markets, Kirkland responds, "No one's going to party like it's 1999, but at Fortune we like to say we're brutal optimists. We believe in the market, capitalism, US business and society: We're optimistic in the long run." But he adds that PR execs can't expect journalists to put a positive spin on things. "We're not going to gloss over the problems. Our job is to describe the world the way it is. It can't be rebuilt by just saying things are OK. People have to behave differently first."
Business circulation Average monthly paid circulation of the top business magazines, from January to June 2002 BusinessWeek 977,128 Forbes 921,410 Fortune (North America) 875,520 Mutual Funds (now defunct) 842,779 Smart Money 822,436 Fast Company 770,672 Inc 680,394 Business 2.0 557,093 Entrepreneur 543,885 Worth 509,010 Black Enterprise 457,836 Bloomberg Personal Finance 410,303 The Economist (North America) 403,131 Better Investing 357,933 Barron's 299,673 Harvard Business Review 243,345 Fortune (Asia-Pacific) 87,995 Source: Audit Bureau of Circulations