BtoB Media Business - December 2007 - (Page 9)

CONSTRUCTION* 2007 YTD pages: 34,235.0 2006 YTD pages: 34,146.6 % change: +0.26% *Includes engineering trade titles ELECTRONIC ENGINEERING 2007 YTD pages: 19,421.3 2006 YTD pages: 20,810.1 % change: -6.67% Bright spots: China is a hot market not only for development but also for consumption of electronics. Revenue growth is coming from online and custom integrated media as well as events. Challenges: Growth in the once-hot semiconductor sector has slowed to a crawl. Online success is giving some advertisers the impression that print is no longer necessary. FINANCIAL SERVICES 2007 YTD pages: 10,747.5 2006 YTD pages: 10,729.6 % change: +0.17% Bright spots: Regardless of market turmoil, industry players will continue to rely on b-to-b media companies to position their message in a changing market. Challenges: Bottom-line losses may shrink ad budgets, forcing advertisers to be more selective about where they place their dollars. Bright spots: Transportation projects should see growth, with a renewed emphasis on infrastructure maintenance and upgrades. Green construction practices continue to show significant growth. Challenges: The downturn in singlefamily construction continues. The credit crunch that emerged in mid-2007 continues to be a major concern in residential and is being watched carefully by commercial and infrastructure as well. T he rough ride continues for the U.S. housing market, with singlefamily housing starts plunging 25% this year and bringing overall construction starts down an estimated 8%, the largest percentage drop since 1990, according to McGraw-Hill Construction. Next year, the industry will face several challenges, including tighter lending conditions and higher building materials prices, and the overall level of construction starts is projected to decline another 2% to $614 billion, the company said. Such market forces affect the construction audience’s information needs, and publishers are responding accordingly. Reed Business Information, for instance, will change the format and frequency of Housing Giants next year. The print magazine, which currently publishes six times a year, will change to an online-only format and publish 21 times in 2008, said Julian Francis, VP-publishing director of RBI’s Building & Construction Group. “In a two-month period this year, you had essentially an absolute credit crunch in the marketplace,” he said. “As a trade magazine, we need to be flexible enough to deal with this type of rapidly changing environment. We have to be able to go in and talk to the biggest builders in the country and report about how this is impacting their business. If we’re only doing that every other month, the issue has come and gone, and they’ve dealt with it.” The “green” construction movement will continue to present opportunities for publishers. “The incredible growth of green and sustainable construction practices is putting a lot of demand on sustainable building design and materials, and that will only increase,” said Norbert W. Young Jr., president of McGraw-Hill Construction. —Mary E. Morrison T he nearly 7% decrease in print advertising pages in the electronic engineering category is no surprise, said Alan Robinson, group publisher of Reed Business Information’s EDN, Electronic Business and Electronic News. “Advertisers are spreading their marketing money around different types of media, primarily online,” he said. Although advertising is migrating online, “dollars taken out of print don’t necessarily come back on the Web,” Robinson said. In addition, with a lot more ways for marketers to spend money online, the lost print revenue doesn’t necessarily come back to the brand that lost the print pages. Robinson said his main priority is to stem marketers’ growing impression that print advertising is no longer essential. “We did a readership study this year and our guys are going around with the results” that dispute this, he said. “Today’s electronic design problems are more complex, and designers turn to peers and trade journals when they first try to solve these problems. Print is strong at this stage—and this is when [product] decisions are made. Our challenge is to educate media buyers about this.” Paul Miller, president of the CMP Electronics Group, said the downward trend in print advertising is not as much of an issue for his group. “Print is only 20% of our revenue stream,” he said. “We’ve been growing online and making online acquisitions, and we’ve also gotten into information services.” Events represent another strong and growing business segment, he added. “The main driver in electronic engineering is semiconductors,” Miller said. “While this segment has enjoyed growth of 30% a year in the past, it’s maturing. In 2008, we’re looking at 7% growth in semiconductors globally. That would be positive in a lot of other businesses.” —M.G. E motions ranging from trepidation to outright panic roiled the financial markets this year, but the media companies that serve the industry’s players aren’t pulling in their own horns next year. Kevin Worth, CEO of The Deal LLC, expects growth across the board in 2008, led by the company’s digital segment and live events. But he admits the upheaval in the credit markets has caused the industry to rethink its assumptions, and that means some uncertainty for media companies, at least until the first quarter. Until then, Worth is trying to keep a little more “wiggle room” in The Deal’s editorial calendar. “It can play one of two ways,” Worth said. “The banks and financial service companies could batten down the hatches or, if they’re thinking ahead, they can realize it’s an opportunity to [reassure people] that their brand is as strong as ever. It really depends on how they react.” Calling 2007 a “sideways year,” David Smith, publisher of Financial Advisor Magazine, said next year should be solid because the company has been expanding its platform to hedge against print advertising fluctuations. That has included more events catering to industry niches in addition to its big-picture symposiums. Sensing untapped reader and advertiser bases, parent company Charter Financial Publishing Network this year launched Private Wealth. Unlike Financial Advisor, which is more of a horizontal play, Private Wealth is a vertical aimed at those who serve super-affluent clients, a space that Smith calls “rarified air.” “We feel like we’re very well-hedged,” Smith said. “Ultimately, financial services firms are going to have to stay in front of advisers, even in a rough market. When the markets turn bad, it’s like an airplane crash. They stop advertising to consumers, but that doesn’t mean they stop advertising within the trade.” —Mary Ellen Podmolik mediabusinessonline.com | December 2007 | Media Business | 9 http://mediabusinessonline.com

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BtoB Media Business - December 2007 Contents Upfront Vertical Outlook Resource Guide Sales & Marketing M&A Events Production Online Circulation People Benchmarks Endnote

BtoB Media Business - December 2007

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