Bo Sacks: The Profit Prophet: The Great Numbers Game
Numbers are very important in our industry. Next to content itself, I think you could make a strong case that numbers are our business. They are ubiquitous to everything we do and create: How many pages are you printing this month? What is your circulation? What is your ad/edit ratio? And, of course, there are a host of other very meaningful and important industry numbers.
But I would like to make the case that not all numbers are equal. Some numbers are saturated in fat—overstated, over-reported, oft-repeated and usually misunderstood. And this happens at least on a quarterly basis. Putting numbers into perspective is very important, and understanding which numbers are meaningful and worth paying attention to is equally noteworthy.
The real purpose of the numbers game should be to give executives an objective perspective on their company's position in the capitalistic universe called publishing. This is an important game that we have all agreed to play, and we actually keep score. The higher the profitability score, the more we can feed our families' needs and wants. In this league, publishers are in competition with other teams. It is the advertiser who plays the role of the umpire calling the balls and strikes, while the readers sit in the stands enjoying the game.
We all pay a lot of attention to the Publishers Information Bureau (PIB) numbers released on a regular basis. The last figures were actually horrific. But when clearly viewed in context with the national economy, they were not that out of line with the rest of the country. The latest figures, reporting on year-to-date ad sales for January through July, showed a 7.4-percent decline in ad pages. But what the heck does that aggregated industry number really mean to you?
In my opinion, not very much. How can it? It's an average of all titles bunched together to create a number meaningless to any individual magazine. As an industry, it might have some trending significance, but not to a single magazine.