Magazine ad sales strong
Elle launch is a sign that the printed word is becoming sexy again

The recent launch announcement of a Canadian edition of Elle magazine puts another nail in the coffin of those whose predicted that the rise of the Net would lead to the decline of printed publications.

Magazine industry advertising revenues are up 8.1 per cent this year as of August 2000 according to LNA Canada Inc., a company that tracks industry trends. Although circulation numbers among the largest Canadian magazines remain flat, the market is being broadened by 20 to 30 new magazines titles that are being launched each year including, Elle Canada.

The new magazine, which is to debut in Spring 2001, will be produced by Transcontinental Publications Inc., in partnership with Hachette Filipacchi Magazines, which together already produce a Quebec version of Elle. According to industry experts the publication has a considerable chance of success. This is because the fashion industry, which spends tens of millions of dollars a year in advertising, does not have enough highly targeted vehicles to get its message out.

Due to the regulations of Bill C-55, Elle U.S. is severely restricted as to the amount of advertising that it can sell to Canadian companies. But the new Canadian version will have more than 80 per cent original content, giving publishers the right to sell unlimited Canadian advertising.

Why the continued strength of Magazines? "The printed word is becoming sexy again," said Gary Garland, president of Magazines Canada, an industry association. "E-mail, and online counter-culture e-zines, -- which allow teens to set up their own publications on the Net - are getting people reading again. These are creating a wonderful feeder system for printed magazines."

Magazines have considerable inherent strengths that make them the ideal vehicle for advertisers looking to target their message to people with specific interests. "There is a magazine for every interest and hobby, said Garland. "And due to technology and better targeting the product is improving constantly." Magazine readers are also highly coveted by advertisers since they tend be employed, with higher education and incomes than the Canadian average and thus have more money to spend.

Magazine's high printed quality, which is due to the fact that they are often produced on coated paper and printed in four color process, gives magazines a big advantage over newspapers when it comes to advertising for items with high visual appeal such as fashion products, automobiles, cosmetics and jewelry. For this reason, and to lower distribution costs many newspapers such as the National Post with Saturday Night, are now publishing their own magazines and distributing them for free to their subscribers.

The high rates that Canada Post charges magazine publishers means that many are favoring store sales as opposed to mail distribution, and this is having an effect on the type of magazines which are being launched. "In contrast to those that subscribe, people who buy magazines in a kiosk, are more likely to want to be entertained," said Pierre Delagrave, president of Cossette Média. "They will therefore favor titles with human interest stories, and celebrity profiles.

The niche element inherent in many publications means that unlike mass media spending, magazine advertising often targets only readers that marketers want to reach. But some industry professionals such as Jacques Dorion, president of Carat Canada, which consults major corporations on how to spend their ad dollars, feel that there are still not enough targeted publications.

"High barriers to entry into the Canadian adverting market, and the fact that there are only two big players in the industry (Transcontinental and Rogers Media), mean that publishers have not been very innovative," said Dorion whose opinion can swing millions of dollars of advertising from one medium to another. "The publishers send me a fax from time to time, but it's not what I call aggressive marketing."

According to Dorion there are some big holes in the Canadian advertising industry's publication lineup. Notably absent is a good vehicle that reaches a large segment of Canadian men. "The American magazine industry is much stronger, and is seeing incredible success," said Dorion. "There is a far broader range of titles, and the larger print runs and bigger markets mean lower costs."

It is likely that the recent surge in magazine ad spending is less an indication of the industry's overall health, and more a sign of the strength of the Canadian economy in general and the advertising sector in particular. But one thing is clear: the printed magazine is going to be around for a long time.


Chart caption: Magazine ad revenues continue to rise in spite of the advent of the Net.

Photo caption: Between 20-30 new magazine titles are put out each year including a Canadian edition of Elle, which will debut in Spring 2001.


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