psmith, journalist

Regional newspapers are either in – or just exiting – an economic crisis. The rules have changed, the ad revenue is disappearing to free online alternatives, news habits have changed and the audience is getting older.

It shouldn’t be this hard, in theory: if the current thinking among intelligent journalists is that you need a niche, then what better niche than a town or city? Nothing unites people or defines them more than where they live. Imagine you had that relevance and you covered an industry or profession – that’s a recipe for success isn’t it?

That’s exactly what Crains Manchester Business did and it didn’t turn out all that well. Launched in 2008 as the first UK title in the Crain’s city-based business title empire (I covered it for PG), the weekly magazine closed last week, citing recessionary pressures. Crain head honcho Chris Crain says:

While we have been pleased with the support received from Crain’s Manchester Business readers from the beginning of the project, ultimately the limited support from key advertising sectors has made the project unsustainable

The idea was to cover the Greater Manchester business scene in print and online. Editor Steve Brauner, a nice guy who like me hails from the east of the city, told me that the Crain’s Chicago website makes some $5 million a year in revenue from selling data lists. The plan was to do the same inside the M60.

A year after it launched, I took a magnifying glass to to its figures for paidContent, and in March last year this is what publisher Arthur Porter told me:

[the mag] now has more than 1,250 print subscribers and got 52,475 unique users in the four weeks to January 11—50 percent up on the previous month (according to internal Omniture data). And he revealed that the mag has made advertising revenues of £320,000 in 2009 to date, including forward bookings. At this point last year it had made £12,000, though it was just three months old. Digital represents about 10 percent of total revenues, with a sponsorship deal for its 8,000 daily emails contributing a major share of that.

It was going in the right direction but £320k in 14 months is simply not enough to support expensive city centre office space – in Piccadilly Tower bang in the centre of town – an editorial staff of around 10 five and then four and publishing costs.

The supposed “five-year plan” for the title has been cut short by two years. Crain could have stood by the title longer and hoped for a profit. Its other titles work in the US and there are undoubtedly businesspeople in Manchester who are interesting in news about them.

Aside from the recession clamping down on Crain’s ability to invest in inprofitable titles, here’s two possible explanations for CMB’s demise…

1. Not enough digital investment: Specifially, what stage did those lists get to in Manchester? Where was the data offering? To what extent where editorial staff involved in putting together must-have data and how much was it used to drive subscriptions
2. Not relevant enough: Manchester is a big place. “Business” is a very fluid term. What was the audience for this title: every single company in Manchester and even the swathes of north Cheshire that CMB admittedly covered? Is that patch too big to attract the right kind of advertising (especially online) or build the community that can be successfullly monetised through real-life events andf add-on products?
3. Where’s the added value online? Crain’s magazine content, some of it very good with some exclusive interviews and clever analysis, was hidden behind a paywall. The only things non-subscribers could see was “commodity” stuff – the stories everyone else has got. For business publishers, this works: the FT, WSJ and countless B2B titles are not going to go back to free any time soon. But for a new title competing with national media, a free-to-air site would have been the marketing tonic it needed – viral, community sharing could have built visibility and credibility quicker and cheaper than any advertising campaign.

It’s easy to criticise and much harder to run magazines in the real world, so these thoughts lack the weight of experience. But Crain’s experience is surely a cautionary lesson for thebusinessdesk.com, the regional business news start-up which has expanded from its Leeds home to set-up regional sites covering Yorkshire, the north-west of England and the West Midlands, with some star names from the regional press on board.

But thebusinessdesk doesn’t have (a) a print product, nor the costs of running one nor (b) the resource-imbalance of promoting a print product at the expense of online.

p.s. Remember those plans for a Timeout Manchester edition?

Update: I should have linked to this earlier: Arthur Porter told How-Do last week he “could have saved” the title if it wasn’t for all that interference from Crain’s in the US. How-Do also reports that the losses from the CMS venture were between £3 million and £4 million – no soure is cited for that but it’s an entirely believable ballpark figure.

Update 2: Also from the pages of How-Do, it seems at least someone is not heeding the warning signs from Crain’s collapse…

Update 3: I’m indebted to from “An Insider” below who points out there were just 5 then 4 editorial staff on Crain’s not 10. The 10 figure comes from the company itself which at one point told me that was the number they were in the process of hiring. I also erroneously called City Tower Piccadilly Tower, which for a Mancunian is a bit shoddy.

Related articles by Zemanta

• Crain’s Manchester Business ends publication (newstatesman.com)
• Magazines are not “easy” newspapers (timholmes.blogspot.com)