Why EGM Died, Part one
By Shoe
In case you didn’t read it from me last time: EGM closed up shop because Ziff Davis Media was too busy managing a massive debt to manage its magazines properly. As far as I can tell, that’s why other magazines can still survive in this economy but ours couldn’t. But really, ZDM didn’t get any help whatsoever from the nature of the magazine business itself. Here are the other major contributors to EGM’s death….
1. Distribution: The magazine business is a horribly inefficent one. We’d have to overprint every issue by hundreds of thousands of copies in order to make a certain amount of sales at newsstands, because so many copies get lost in the distribution process. A 40% sell-through may sound horribly wasteful to you (it is), but that’s considered a sales success to us. 50%? Horray! Now…think of what our financials looked like when 60%+ of the copies we paid to have printed (roughly $1 per issue) get thrown out.
The printer prints the magazines, then they go to a variety of distributors, shippers, and wholesalers to get moved all around the country. I won’t get into details of this process, but let’s just say we might as well have used the Pony Express with crippled horses. And funny enough, a lot of copies never make it to the stores — they stay on the trucks somewhere because the entire distribution system is archaic. Every person you’ll ever talk to who deals with the circulation business will tell you how much they hate this setup, but no one can do anything about it because it’s an established network that really has no reason to change (there’s no money in fixing it).
And with the copies that make it to the stores, some of them never make it to the actual shelves, because very few retailers care about magazines (they’re not high-income items). And if they’re lucky enough to make it out of the back store room, there’s no consisent system to how they’re displayed on newsstands. That hot copy of EGM’s Street Fighter IV world-exclusive could be hidden behind Hot Women on Hot Rods Magazine or the latest Crazy-Ass Crosswords!…and no one would ever know.
How many times have you walked into a store and couldn’t find the newest issue of your favorite magazine, but a three-month-old copy is still sitting on the shelf? Again, it’s because no one cares about magazines. A lazy sales clerk may see “EGM” there and not know that particular issue’s expired and is supposed to be replaced. So then that outdated issue doesn’t sell, our newer issues don’t get a chance to sell, and we lose circulation and revenue.
Actually, some sales clerks do care about magazines…enough to keep them for themselves. I used to work at EB Games, and I know how this works. A new shipment of magazines would come in, and we’d rip them open to read for ourselves or to take home…before a customer can even see them. Periodicals weren’t in the system as real inventory, so no one would ever know if they ever got sold or not. So for the employees there, these were all free magazines. Why not take a few? So now here’s Ziff Davis Media…paid for 10 issues to be printed and shipped to my particular EB Game store, and maybe five of them will actually make it to the shelf after the employees raided the box. If three of them get bought, that’s 30% efficiency right there.
So to all the people who are wondering if our upcoming business is magazine-related: hell no.
2. Advertising: Of course, a lot of advertising dollars are moving away from print and onto the Internet…that’s a pretty obvious way EGM got hit hard (you’ve seen how thin the issues have gotten over the past few years). Magazine ads deliver vague, immeasurable impressions. Yes, you can offer circulation numbers, and third-party services study how many eyeballs hit each issue, but they’re not the same as a banner advertisement, where you can literally count every person who’s on that page or who has clicked through that ad. Traditional magazine ads just aren’t important these days when advertisers can grab your attention with “smash this baby monkey’s brains in with this sledgehammer and win a free yacht!” banners.
3. The Internet: And you also know how the Internet as a content source is making it difficult for magazines to thrive. We’ve heard it a billion times from our readers: Why pay for an issue or a subscription when the web has so much more stuff to read/watch/listen to…for free? That hurt us as well, despite our best efforts to evolve and stay relevant and different in this new information age.
4. Ourselves: ZDM’s own editorial policies didn’t help the bottom line. Editorial coverage wasn’t for sale. Covers weren’t for sale. Scores weren’t for sale. Game companies that we’d cover couldn’t sponsor editorial sections. And if the editors somehow pissed off an advertiser, screw it…let them stay pissed. No make-up coverage for them. (Crispin writing a make-nice Contra preview to make up for something that I wrote that pissed Konami off was to appease their PR team, not their media buyers, and that was a long time ago, when we were baby-faced newbies and before Ziff came into the picture.)
Don’t read into that the wrong way: With regards to how advertising worked with editorial, we loved working in the environment that ZDM and my old bosses set up, and I was happy that corporate almost always had my back when it came to keeping church separate from state. Those policies served us well, and we’ll continue to abide by them in future endeavors. Ultimately and unfortunately, however, that didn’t translate into extra profits for EGM.
But we wouldn’t have had it any other way.
RIP EGM…1989-2009.
Read: Why EGM died, part two
P.S. Thank you to the following new people for their recent donations toward our upcoming project (for now, we’ll call it “Project P,” whose naming origins is absolutely ridiculous…but that’s another story for another day). They’re coming in from all over! The U.K., Mexico, and even that strange foreign land known only as “Canada”….
- Stephen Kleckner
- Dexter S. (again!)
- Jeff V.
- Kevin D.
- Luz G./Alfredo G.
- Jarrod H. (who sent us his EGM subscription renewal money…which is ironic and sad for us at the same time. We hope we can live up to that!)
- Shuing-Jeh C.
- S. Ross S.
- Alison H.
- Colin W.
- Thomas W.
- Aaron W.
- Dave S.
- Matthew R.
- Ron B.
- Mike C.
- Shane M.
- Tony T.
