Zilch. Zero. Nix. Diddly squat. Sweet FA. While a fierce debate rages about the viability of free newspapers, a quiet insurgency has been infiltrating tube stations, travel points and offices around the country. Free magazines, thrust into your hand on the way to work. Decent magazines that don’t end up in the nearest bin. And absolutely free.
So, are freebie mags here to stay, or are they simply a desperate attempt to boost an industry paranoid about static or decaying circulations? Are freebies a mere dalliance – or a profit-generating masterstroke that plugs naturally into the way consumers access information in today’s world?
There’s nothing new about free magazines. Seasoned commuters will remember sidestepping the distributors of Girl About Town, Ms London, Midweek and Nine to Five during the Seventies and Eighties. These titles, all aimed at women, were little more than pages of recruitment ads hanging off articles about ‘How to be a Perfect PA’ plus the occasional spread of handout fashion pictures.
Today, there are three free magazines widely available in UK cities – Sport, Shortlist and the recently launched Stylist, handed out between Tuesday and Friday. Stand outside any central London tube station and you will no longer find the commuter playing dodge-the-distributor. They are more likely to negotiate the travelling swarm to demand their regular copy. And that’s because all three magazines are well-targeted packages, ideal for that depressing slice of the day when people are on their way to work – or too shattered at the end of the day to cope with anything too demanding. If we add to this list the Fly (ABC 108,906), the music magazine widely available in record shops, night clubs, coffee shops and clothes stores, the quality free magazine has now become a phenomenon that can’t be ignored.
They demonstrate editorial values – topical ideas, tight writing, smart design - that would give many paid-for titles a good run for their money – and they are a million miles from the dreary give-aways of the past. Two of them, Shortlist (ABC 513,148) and Stylist (ABC 410,674), are products of Shortlist Media, built from scratch three years ago by CEO Mike Soutar, whose jet-fuelled career has included editing Smash Hits, successfully rebranding FHM, launching Maxim in the US and, as editorial director of IPC Media, launching Nuts.
The cramped foyer at Shortlist Media’s Bloomsbury offices is dominated by a glass cabinet in which eighteen chunky awards compete for space – including Consumer Magazine of the Year, Editor of the Year, Columnist of the Year, Designer of the Year and Advertising Sales Team of the Year. It’s an impressive manifestation of editorial and publishing know-how, and a major reason why, from a position of scepticism and doubt, the magazine industry and advertisers now take freebie magazines seriously.
The burning question
But there’s no getting away from the leading question. With no cover price, and only one revenue stream, can freebies really thrive?
Mike Soutar is adamant that the right kind of free magazines can produce a sustainable business model. “In our first year of operation, we made a net loss of about £3 million,” he says. “In our second full calendar year, Shortlist will have made a profit. Not a massive profit. Nothing to retire on. But our growth has become quite extraordinary. Our revenues grew by 86% between year one and year two and they’re still growing now. We’ve learned that this is a business model that works when you do it at the right scale. Small and free is a really difficult business, but when you do something on a large scale and you’re delivering high quality information and entertainment to consumers for free, consumers value it and advertisers value it too.”
The distribution mix
There are two elements to Shortlist’s distribution system. As well as direct delivery to street-based merchandisers, the company has developed distribution partnerships and now drops off magazines in city centre workplaces, each of which gets, say, a bundle of 50 or 100 copies. These outlets include retailers like French Connection and city banks, and there are deals in place with gym chains where copies are placed in the men’s changing rooms. Soutar says that 50-55% of copies are distributed by hand, 45% delivered directly to specific centres. Now Stylist is benefiting from the same distribution mix.
One of the great benefits of free magazines is a super-efficient distribution system. As the Standard has discovered in London by focusing distribution on central London and ignoring the suburbs, free magazines concentrate their distribution efforts in the centres of large cities (Shortlist in eleven cities, Stylist in six, and Sport in London only) and waste is reduced almost to zero. In many areas, Shortlist and Stylist enjoy evening distribution as well – so that any copies undistributed in the morning will be handed out in the evening.
“The traditional paid-for supply chain is becoming more and more sclerotic,” says Mike Soutar. “Supermarkets are taking 40-45% of the total volume of magazines, and that means they’re cutting down on the range of titles they’re stocking, and they require a very high degree of availability. You can’t be in a supermarket if you’re going to sell out, which means wastage levels are constantly rising. At the same time, for cultural reasons, the number of small newsagents going out of business has never been higher, so it is almost impossible to do something that is different on the newsstands, and your level of wastage is enormous. An efficient magazine is selling only 65% of the copies it prints, whereas we distribute 96-97% of all the copies we print, which takes a whole lot of cost out of the business.”
The editorial mix
The free magazines combine this efficient distribution model with the best quality paper they can get away with – an improved newsprint that takes colour reasonably well – a lean back office operation, and editorial costs that are clearly tight. The magazines are packed with top ten lists and new product blurbs; there are no big exclusives, a noticeably restrained attitude to the overworked category of celebrity and few original photo-shoots. But all three magazines feel smartly designed with liberal use of well-used pictures. There are often creative tie-ups with advertisers, such as the issue of Sport in February that featured England rugby star Jonny Wilkinson as guest editor. The issue came perilously close to being an extended advertorial with Wilkinson, a brand ambassador for Gillette, sporting the Gillette logo on his shirt throughout the magazine, and the company taking a number of ads in the issue. But Wilkinson was more than a token presence - he added good editorial value throughout, giving his extended views of the six nations championship, and his opinions on a range of topical events.
Sport editor-in-chief Simon Caney says it’s important to see the freebies like Sport as magazines that can confidently be compared with paid-for titles in terms of quality. “It would be easy to knock together something pretty average and thrust it into people’s hands, but they wouldn’t come back for more next week. Sport has to work as a product people actively want.”
Caney says that Sport (ABC 306,435) is now enjoying week by week profitability, although last spring few people expected it to survive when its French owners, Sport Media & Strategie, collapsed. It was perhaps a measure of confidence in the magazine’s – and the market’s - viability that it was snapped up UTV Radio, owners of Talk Sport, and was soon back on the streets.
A confident Caney is uncompromising about the magazine’s target audience. “Our readers don’t want loads of statistics, they don’t want heavy going. Typically they pick up Sport on their way out of the tube rather than going into it, put it in their bag and read it on the way home or in their lunch hour. It’s a half hour to 45 minutes read. We don’t expect our readers to pore over the mag for hours like a thick glossy monthly. And that’s an important point of difference.”
Nipple free zone
Both Sport and Shortlist go out of their way not to be too blokey. There’s a zero nipple count in both magazines and the once-thriving men’s market, heavy losers in the last round of ABCs and many undergoing revamps, might look to the success of the two freebies for clues about where the men’s market is today. Simon Caney at Sport says: “We have one spread per week that has a relevant female sports star in a swimsuit or similar – like Australian water skier Lauryn Eagle – but that’s it.” And Mike Soutar, who, with his ex-Nuts editor-in-chief Phil Hilton knows a thing or two about the men’s market, says: “With Shortlist, we aimed to produce something men would be proud of rather than ashamed of.”
The key relationship for a freebie, of course, is with advertisers, and Soutar admits that the early days of Shortlist “were just like pushing water uphill with a fork. Advertisers weren’t sure, we had support from some places, we had no support from others; nobody was convinced, apart from us, that we were doing the right thing. It took between three and six months before I could sleep soundly at night.
“We had to overcome all sorts of scepticism. But ultimately what overcomes this is that we can’t hide what we do. It’s a very transparent thing. You get on the London tube system and you see consumers actively engaged with what we produce. You can’t fake that. Of course you will get people who will say it’s not the same value as something that’s paid for, but we hear that less and less.”
The advertising mix
Soutar reckons that 70% of the revenue for Shortlist and Stylist comes from straightforward display advertising. Most of the remainder comes from creative collaboration between advertisers or sponsors and the editorial team, the aim being to add to reader value. An intriguing Hugo Boss advertorial in a recent issue was a good example; readers were asked to get down to the Hugo Boss store in Sloane Street and, holding a page from the magazine against a special screen in-store, they could find out if they’d won a competition. With a business model that only works by generating the maximum possible advertising revenue, advertorials inevitably make up more pages than in a paid-for title.
But what do advertisers themselves think of the freebie mags?
Nick Crisp, an account director at TCS Media recalls the traditional view about free papers and magazines: “If someone made a conscious decision to purchase something, they were always thought to be prepared to spend more time with it, and the knock on effect was that the advertising would work harder,” he says. “It’s a natural conclusion that if you buy something you attach more value to it.
“But now a strong and successful brand like Metro commands a premium when it comes to buying space. On the other hand, London Lite and The London Paper, when they were still with us, were much weaker brands and had a much lower perceived value to advertisers. It’s all down to how well the brand communicates with its target reader.
“The magazines came out of nowhere and I must say that when I first saw them, I was deeply sceptical about their effectiveness. Sport has been with us for a while now and its content is generally good, although, like the rest in this market, it’s superficial, it’s full of bite-sized stuff. Shortlist, for instance, is overloaded with lists. Stylist looks good, and interestingly, it’s picking up the ads. For instance, L’Oreal said they would never advertise in free media, but they have broken that rule already and placed business in Stylist.
“With these magazines, it’s not so much about demographics, it’s more about the type of people who are consuming them. They’re people on the move, people in work, people who go out to be entertained.
“A few years ago I wouldn’t go near Metro, but now I have the evidence of my own eyes. People like it, people use it, and the stigma that used to be attached to frees isn’t there anymore. Media agencies used to be actively hostile to them. But now, generally, they’re on their side.”
Reader expectations
Another change of attitude over recent years is that people have become used to getting things for free. The internet has bred the idea among the generation born say, after 1980, that they don’t pay for basic news, information, or entertainment. And they are conditioned not to expect depth. A skim through the headlines, a dip into what’s new, some top line listings delivered in a crisp and easily absorbed way – they’re happy with that. And sometimes they don’t need any more. Add to that the emergence of good quality, free contract magazines like John Lewis’s Edition, and there’s an audience who see freebies as natural, even cool.
“These magazines work because the world is changing,” says Mike Soutar. “We launched off the back of a huge generational change in the way people consume media. We are dealing with a generation that has been brought up online, who expect high quality information and entertainment, but they don’t expect to pay for it. But they still value it. And the people that buy advertising are that generation too; and they are our readers as well.”
With this generation in mind, Mike Soutar says that the aim with Shortlist, was to create a magazine that would work on two different editorial levels. “First, it would be instantly accessible, inhale-able, on a commute. We knew that when people first came into contact with the magazine they needed value they could suck out straight away. But we wanted to make sure that there were more substantive pieces of journalism as well, so that there were reasons for people to hang on to it. Unlike Metro, which is a fantastic newspaper for fifteen minutes, and at that point it runs out of usefulness, our research shows that the average length of time people hold on to a copy of Shortlist is two and a half days. There’s enough in there for you to want to go back to for different levels of involvement. So it goes in the bag and isn’t left on the shelf behind the tube seats.”
Just as Sport and Shortlist re-assessed the men’s market, Stylist too is a different beast from the traditional women’s weeklies. Most noticeable, it’s low on soaps and the tacky end of celebrity, and a recent issue mixed two pages of Valentine’s ideas, a piece about women taking over in French boardrooms, four pages of military chic fashion, a lengthy feature on Winnie Mandela and a whole page devoted to one extraordinary Marni shoe (£460 a pair). “Research told us that what women were looking for was an intelligent weekly, which has meant that we have been unafraid to run longer features, and a magazine that would take their career aspirations seriously. I hope a feeling of real feminine empowerment comes through,” says Soutar.
Distribution-wise, Soutar says it has proved much easier to give a free magazine to women than men. In the early days of Sport and Shortlist, it wasn’t unusual to find men going out of their way to avoid the merchandisers, creating a mini exclusion zone around the man with the mags. “With women it was different”, says Soutar. “Partly because the market had moved on, and I think that women are less sceptical of free things, broadly speaking, and they love magazines.”
Can we expect more freebie magazines in the future? Mike Soutar doesn’t rule it out.
“I suspect there is a lower limit than there is for the paid-for sector - you wouldn’t be able to move in the streets for merchandisers. Now we have created a nationwide distribution network and a business model that works, so there is the opportunity to bolt on more products. My instinct tells me there are two really great opportunities, great propositions out there. And no, I’m not telling.”
So watch this space. Or rather, watch the entrance to your regular tube, bus or train station. With the one million copies a week barrier breached, it looks as if a new magazine battlefront is opening up right there in the street.
