ACP: what's fun got to do with it?

By DITA DE BONI

Returns on investment may look rosy, but fun has become a casualty of heavy cost-cutting at the country's largest magazine publisher

ACP New Zealand managing director Bruce Cotterill has been given a pat on the back by visiting Australian chief executive John Alexander, who said the local division had outperformed its Australian parent with a dose of determined cost-cutting.

Speaking to the Magazine Publishers Association of New Zealand, Mr Alexander warned that other publishers would have to take a similar path as print media costs rose and returns on investment shrank.

"Fun does not come into it so much any more," he said. "[Magazines] are a business. They've gone from family-owned operations to global conglomerates and have come under pressure to lift their financial performance. The question for print media now is where to best allocate capital within the organisation."

ACP has slashed staff numbers over the past year to boost returns in a flat magazine market.

Top-rung editorial staff have been particularly vulnerable. One editor, for example, now edits both the company's home titles, Home & Entertaining and Your Home & Garden, and another looks after three of its women's titles, She, Cleo and Fashion Quarterly.

The result has been a glowing financial performance for the New Zealand division, despite a flat market and a smaller market share than the Australian business. ACP does not reveal comparative earnings for its divisions.

Mr Alexander said the company was "not afraid to close" publications. While 30 magazines had been acquired or established in the past three years, 20 had closed in the same time.

And, he said, despite cut-throat competition on magazine stands, the next six months would reveal further growth plans for the local division in "media-related areas" - which could include new titles.

Mr Alexander said the industry on both sides of the Tasman faced the problems of lacklustre markets, greater competition for advertisers and the "struggle to hold readership."

Editors would be required to keep a close eye on expenditure to avoid disappearing into the publication netherworld, he said.

Websites linked to magazines - once considered compulsory - had not always produced promised yields and "while some sites are fantastic, most are showing a lousy return."

The answer for magazines, he said, was to offer "strategic information and go for increased specialisation in terms of staff."

Mr Alexander has been at the helm of ACP since 1999, during which time he has overseen a $20 million turnaround in the company's fortunes.

Before joining ACP, he held a number of newspaper roles with Fairfax, where he was editor-in-chief of both the Sydney Morning Herald and the Australian Financial Review.

ACP has a stable of 25 local magazines and will launch its newest title, About Kids, at the end of the month. The new title follows the success of one of the company's most popular magazines, Little Treasures, which achieved a 17.4 per cent leap in readership recently, when the fortunes of other ACP titles - including the third-biggest-selling New Zealand magazine, Woman's Day - were flagging.

The company holds around a third of the New Zealand magazine market, and 43 per cent of the Australian market, recently moving aggressively into niche and trade publications.

The company had a public spat with one of its staff, former Woman's Day editor Wendyl Nissen, last year, after she criticised ACP for tightening budgets.

Ms Nissen now heads Australia's Family Circle magazine, owned by Murdoch Magazines.