Playboy Enterprises Competition
Now Viewing Playboy Enterprises's competition in: Magazine Publishers
Call Preparation Questions
Customers, Marketing, Pricing, Competition
Who is the company's target audience? - Audience is often defined in demographic terms (such as 18-to-35-year-old males).
Does the company conduct market research to identify its readership? - A well-defined readership is more attractive to advertisers.
Has the magazine tried to expand to overseas markets? - Most big or popular magazine publishers enter foreign markets under license deals or via a joint venture with suitable local partners.
What types of advertisers buy space in the company's magazines? - The largest advertisers in consumer magazines are car, computer, financial services, and drug companies.
How does the company find new subscribers? - Advertising, direct mail, and point-of-sale promotion are the main marketing tools.
Does the magazine's marketing strategy include capitalizing on a brand or celebrity name? - Magazine publishing companies are partnering with brand names and celebrities to draw more readers and mitigate the rising cost of increasing circulation. This new trend could lead to the demise of the small to midsize publishers of consumer magazines, which can't afford to attract brand names and celebrities.
How important is telemarketing to the magazine's marketing strategy? - The FTC has proposed several amendments to telemarketing laws, which limits magazine sales and marketing strategies.
How much of a discount off the cover price does the company give distributors? - The standard has been 40 percent, but some distributors are demanding more.
What percentage of the company's newsstand copies is returned? - The industry average is over 60 percent.
Does the company pay large retailers for favorable display space? - This practice has become more common in recent years.
Competitive Landscape
Demand for magazines is driven largely by growth in consumer income. The profitability of individual companies depends highly on marketing expertise. Small companies can compete by specializing in niche topics and markets, while larger companies benefit from a wide selection of magazine titles to offer advertisers. Large companies also have economies of scale in production and distribution. The industry is labor-intensive: average annual revenue per worker is $120,000.
Business Challenges
CRITICAL ISSUES
Dependence on Advertising - Advertising accounts for the bulk of magazine publisher revenue. More than 85 percent of total ad spending is by 12 industries, making magazine publishers susceptible to downturns in those particular industries. Ad spending is measured by the number of pages sold (“ad pages”).
Paid Circulation Slows - Total industry circulation revenue has slowly declined in the past decade and circulation has been flat. The annual paid circulation for magazines covered by Audit Bureau of Circulations has been virtually flat for 10 years, at 365 million copies. Magazines aren't a growth industry, although the value of magazines as an advertising medium has increased. Circulation is defined by subscription and single-copy (newsstand) sales.
Industries Where Playboy Enterprises Competes
- Leisure
- Entertainment
- Adult Entertainment(primary)
- Entertainment
- Media
- Internet Content Providers
- Publishing
