The Spanish Market

We’re only a few weeks into the new year, it’s cold and wet outside and a lot of publishers are still reflecting on their UK sales over the Christmas period. Funny as it may seem, now is the time to look forward and consider supplies and marketing campaigns to boost sales in key summer export markets. The Spanish market should be central to this strategy and offers UK publishers an excellent opportunity to increase sales.

It is, of course, pretty normal to see English-speaking territories like the USA, Canada and Australia ranking in the top five export markets for UK publishers. It is surprising, however, to see that Spain is, for many publishers, the number one non-English speaking export market. Surprising when you consider the general level of English comprehension in Spain is perceived not to be as high as it is in Scandinavia, say, or in Holland and if you consider the maturity of the Spanish magazine market. There are Spanish language titles covering practically every category and sub-category, meaning that locals can choose a Spanish language title instead of having to buy an English language equivalent in their choice subject.

But, it is not quite so remarkable when you consider that Spain is a key tourist destination for British holiday makers. It stands to reason that the number of potential readers makes this market a serious consideration for exporting product - during the summer months particularly. It is important not to forget that the number of ex-pats living in this market throughout the year is also growing and the pockets of ‘immigrants’ are relatively easy to target. The ‘Brits abroad’, generally, are very important customers for UK publishers in Spain and the backbone of their sales.

With sales in the UK being flat at best, publishers would do well to capitalise on the opportunities offered to them in the European holiday hotspots frequented by British tourists. Sales in Spain benefit particularly from the influx of British holidaymakers between April and October.

The Market

Spain has a population of 44 million people, with a third of the population living in or around the cities of Madrid and Barcelona. The unofficial number of UK ex-patriots living in Spain is around 750,000 (only around 400,000 are officially registered), with a high percentage of these ‘immigrants’ living in the regions around Malaga and Alicante.

This is not to suggest that only ex-patriots are buying English magazines in Spain, but they are an important group to consider. More important are the UK tourists and business travellers that visit Spain. In 2008, Spain hosted 57 million visitors from around the world, of which 30% came from the UK. Drilling down further, over six million British tourists visited Spain between July and September, concentrating mainly around Malaga, Alicante and the Balearic Islands. This is a sizeable group that is relatively easy to target by supplying outlets in major airports and outlets in areas that receive most tourists such as Madrid, Barcelona, the Costa del Sol and the Costa Brava. Granted, Spanish people do buy English language magazines in great numbers and publishers will disregard their Spanish readership at their peril, but publishers must identify and target the ex-patriot and the tourist ‘communities’ as a priority, as they are hugely important to UK magazine sales in Spain.

The Economy

Spain, like the rest of the world, is being hit by the economic crisis. With unemployment currently at around 11% and economic growth at less than 1% in 2008, the Spanish economy is in a state of inertia (at best) and magazine sales are in decline. Indeed, statistics show that since 2001, prices have increased by 25% and that magazine sales in Spain have dropped by 10%.

Spain is reliant on a healthy tourist industry – particularly on the influx of British holiday makers – as are sales of UK magazines in Spain. However, the outlook for 2009 is not bright. Forecasters warn that the number of tourists from Britain will decline as result of the economic downturn and the strength of the Euro against Sterling. The likelihood is that magazine sales will be affected negatively as a result. With the increased number of flights by budget airlines from the UK to Spain over the past few years, a lot has also been made of the ‘wrong kind of tourist’, too. It has been remarked that the budget travellers are staying for a shorter duration and are spending less whilst they are visiting.

Distribution

There are approximately 2,500 imported and 4,000 domestic magazines distributed in Spain. Publishers from the UK are spoilt for choice when it comes to choosing a distributor in Spain. The UK press is currently split between three distributors. Realistically, however, publishers can choose from a total of six distributors.

The Spanish distribution system is similar to that of the UK, although wholesale distribution is not confined to geographical areas in Spain and you can find up to four wholesalers serving the same retailer. Copies are trucked (or flown) from the UK to the Spanish distributor’s central warehouse, where they are broken down and distributed to the local wholesalers throughout the country. There are 100 wholesalers operating in 55 regions in Spain. A local title would be distributed to around 60 wholesalers, whereas an imported title might go to 30 as a maximum. The wholesalers then forward copies on to the retailers located in their service area.

Retail

There are approximately 27,000 retail outlets selling magazines in Spain and this figure is on the decline. Indeed, in 2001 there were over 31,000 retailers. In 2006, in conjunction with a new law which banned smoking in public places and cigarette advertising, the government passed a law banning the sale of tobacco products in kiosks and newsstands. Many outlets were forced to close once this major revenue stream had been cut off. Press sales have suffered from the closures and also because people buying cigarettes (who might have impulsively purchased a magazine or newspaper) have no reason to go to these outlets anymore.

Only 1,500 retailers regularly sell international press (including airport stores, bookshops, kiosks, supermarkets and tourist shops). This figure doubles in the peak summer months when campsites and seasonal shops also place orders. Most of the retailers are independently owned shops and kiosks and will represent the majority of an international title’s sales. However, there are a few recognisable chains, such as RELAY, VIPS and BDP, which, considering their small number are also important sellers of international press. The RELAY stores are located at airports and underground train stations, whereas VIPS and BDP stores can be found in shopping malls and in metropolitan areas.

Competitive Advantage

The rewards for exporting to the Spanish market can be great but the product has to be right. Because of the strength of competition in Spain from domestic titles and other English language imports, UK publishers have to consider a number of things (including pricing, promotions and added value such as covermounts and supplements) very carefully to enhance their product, just as they do in the UK.

* Price: The average price of a UK monthly publication in Spain is between €7.00 and €9.00, which equates to £6.50 - £7.50 for a magazine. It is true that imported titles are considered to be premium products and therefore people do expect to pay a higher price for them, however, competition is strong and there is a limit to what the cost-conscious British tourist is willing to pay. It is important for UK publishers to seek information and advice from their export distributor with regard to pricing their product competitively in export markets. UK magazines can gain readership from other imported titles by simply funding a lower, more competitive price - giving up some remit to enable the local distributor to lower the local price. Highlighting the low price with a sticker will help the magazine to catch readers’ attention.

* Promotions: Different promotions are available in the main chains and in independent stores and can be region specific. However, promotions need to be chosen carefully. Again, it is advisable to consult your export distributor, who can provide you with a full range of promotions available and recommend the most appropriate one. The main promotions during the summer months get booked up quite early, so it is best to plan far in advance. Sales during the promotion need to be monitored closely to gauge whether the exercise is cost effective.

* Added Value: Publishers are also advised to include supplements and covermounts on export copies as well as on UK copies to make their magazine more attractive to the reader. Consumers are price-conscious and, rather than being brand-loyal, want the best value for their money. Summer themed covermounts like flip-flops, sarongs and sunglasses work very well indeed.

* Local language: Publishers may also consider translating their titles into Spanish so that they can reach a much larger readership. There is a large element of risk (and also great reward) involved here and publishers should, again, seek information, advice and recommendations from their export distributor.

Time Sensitivity

Time sensitivity for monthly titles is not a huge issue as most UK titles are on sale across Spain within ten days of the UK on sale date having been road freighted through France. However, major UK weekly publications aim to be on sale in Spain the same week as they are in the UK. The copies are flown to various hubs across Spain in order to achieve this and to maximise their sales in the tourist / ex-pat areas.

It is interesting to see that some UK newspapers have been printing locally in Spain for a while now to provide the ex-pat and tourist markets with ‘Day A’ distribution of their newspaper (ie. same day distribution). Sales have risen enormously as a result.

Conclusion

In summary, UK publishers should look at Spain as a potentially strong market for overseas sales... but, realistically, only during the summer season. During the winter, opportunities to sell large numbers are limited to the main cities like Madrid and Barcelona, despite the English speaking population and the tourists heading for ‘winter sun’ in the Canary Islands. To maximise sales, publishers should price their titles competitively and make them as attractive as possible to the consumer. Finally, publishers should always consult their export distributor for information and advice on distribution to overseas markets, be it in Spain or anywhere else.