There should be enough here for an item. Also if you want to mention this Iv’e sent emails to anne parsons at Zenith Media, Paul Leeds @ starcom worldwide and Samy Maysom @mpplus and did not get a response. If you think I’ve missed something you saw let me know…

Misha

An anon tipper writes:

Your ABC story is on the money but you are attacking it too weakly. This important issue will disappear this way.

I suggest you do the following. Ask the senior executives of Fairfax/News/ACP etc to reveal what precentage of their ABC numbers come from:
a) full rate newstand sales
b) discounted sales from special offers
c) sales where the product is given out at some kind of event where the entry price includes a copy of the paper
d) sales to students
e) sales to teachers/educational establishments f) any other
sponsorship
type arrangement where the product is provided as extra value to the attendees/delegates.

Not only is this a rort that everyone knows about – most of these companies – most notably the newspaper companies spend hours and hours dreaming up new ways of including sales in any work they do.

Ultimately the real numbers will make a further mockery of the Morgan readership methodology as well which also over inflates advertising rates.

Keep going Crikey – you’re not there yet!

Another tipper writes:

Strike a light finally someone has come clean on the matter of readership and circulation which are two different areas. Like one magazine or paper might be read by the purchaser and another couple of people.The circulation reflects what went out the door. Ask any truthful newsagent and they will tell you that they are over supplied with magazines and newspapers. If you would like to take an early morning trip around the suburban newsagents and check out the amount of copy (newspaper) that is being sent back then you would come to the conclusion that not all is well and confirm that there is a great over supply.

The magazine publishers toss what ever they can at the newsagents like forty copies of Who the agent would be only selling half of the amount. They say that the 1st Fleet Yard at Villawood which handles the distribution of Gotch, ACP and RDS etc has at some times taken a quarter of the yard of palletized magazines. One newsagent told be that a major supermarket chain open up in his country town and received ten bulk of Who along with an abundance of other weekly magazines. The supermarket manager fronted up to the newsagent and want to know how many copiers of these magazines would he (the newsagent) expect to sell. They figured it out that between them they had enough copies to supply the town folk and the next adjoining town.

The British Prime Minister Benjamin Disraeli once said.There are small lies, big lies and then there are those bloody big lies called statistic.

I forgot to mention the Bulletin magazine, they cant even given them away and Madison what a flop. Get hold of the Newsagent news from Network and have a read of the crap they expect you to believe.

Thanks for a great site that like to air the truth

Regards Harry

A subscriber writes:

I wondered why the Herald Sun was giving everyone a blue plastic bag containing that day’s issue last Saturday at Phillip Island (Round of World Superbike Championship)

and Jack Waterford sent us this:

Actually you can use this any way you like – it’s a column I wrote about nine months ago

Jack waterford

Addendum column in Panorama – Canberra Times Saturday magazine

28.8.1904

By Jack Waterford

THE AMERICAN newspaper industry is gripped by circulation scandals, and I should not be greatly surprised if the backwash hits Australia. Four major newspapers have admitted cooking their claims of paid circulation. New York’s Newsday

was exaggerating by 40,000 copies a day on weekdays and 60,000 on Sundays – between six and 10 per cent of its actual circulation. The Chicago Sun-Times

invented about 78,000 fake sales a day – about 25 per cent of its claimed newsstand sales. The Dallas Morning News

has admitted padding by about five per cent on Sundays and 1.5 per cent on weekdays, and a Spanish-language paper, Hoy

, has admitted overstatement of about 20 per cent.

This is not mere bragging, or seeking to overstate one’s influence. Circulation figures are used to justify advertising rates. As Edward Wasserman from Washington and Lee University put it, newspapers rent out their audiences to advertisers. “The bigger the audience, the higher the rent.” If claims about the size of the audience are fraudulent, advertisers have some right to consider that they have been dudded. There are already lawsuits from advertisers in train, and most expect that there will be more revelations before the dust settles.

In theory, American newspaper circulations are audited, as in Australia, by an independent body known as the Audit Bureau of Circulations. The ABC is not complicit in the circulation frauds, but its systems have seemed extremely susceptible to false claims and not well adapted to detecting them. In any event, some critics have suggested that they allow as legitimate so many “fuzzy” sales, that the scandal is not so much what is illegal as what is legal.

Ever wonder, for example, why there is often a copy of the Australian

readily available on your airline seat or at any number of hotels or conventions? The chances are very high that each copy seen about is rated as paid circulation for the newspaper, even though you have picked it up, if you did, without payment. The bundles of newspapers not even picked up by day’s end will probably also rate as paid circulation.

Why? Probably because there is a paper trail showing that the airline, or the convention host, did actually pay, and at market price for these newspapers. If Qantas wants to bulk-buy and distribute them free to its patrons, why should they not count as paid circulation.

What that particular paper-trail will not disclose is that there is also another set of transactions not disclosed as part of the circulation reporting. This will show that the “payments” for the newspapers were recorded elsewhere as a credit, whether of cash or advertising, and that no real money changed hands. Some people think that as much as a third of the Australian’s

claimed circulation of 134,000 comes from such tricks.

All newspapers, including The Canberra Times

, offer discounts for regular subscribers, and as incentives to begin taking a subscription. Nothing wrong with that, why should not steady readers be rewarded? But the nature of some offers by some newspapers to some groups invite the question of whether they are simply padding their figures rather than genuinely making sales.

Old ABC rules had it that newspapers discounted by more than 50 per cent could not count as “paid” circulation. The figure is now much lower, and, for some newspapers, such discounted sales have become an increasingly important proportion of total sales. And some make special offers to particular groups – teachers or university students, say – where the effective return to the publisher is less than 10c a copy (in some cases possibly even at a loss) – but which can claimed as not having been too greatly discounted because they have long maintained a special price for such groups.

ABC rules always allow publishers to not count for circulation audit purposes public holidays and days immediately before and after, and sometimes bad weather, production problems or even unusual events, though, of course, unusual events likely to increase sales – a major bushfire, September 11, or the death of Princess Diana are always included.

I did say “of course” but, actually, long term managers sometimes shudder at circulation-boosting special events. They want a steady upward trend in circulations. But they know that if, say, something like a major bushfire dramatically improves sales from the average over a six-months’ period last year, then this year will b e a headache for the circulation manager. Unless, of course, he goes out and lights another bushfire or arranges for some dramatic event.

I was once deeply proud of my role in organising special features in The Canberra Times

– including the names of 70,000 Vietnam War veterans – which boosted circulation by some 40,000 copies (say an average of 250 a day over a six month audit period) over the weekend in which thousands of people came to Canberra for the opening of the Vietnam Memorial.

It was good at the time. But a year later, there was no such event in town in the least bit capable of matching such a feat, and the average circulations for that period, though up on the “real” average of the year before, could not match this one-off.

Although the ABC also audits the more respectable “free” newspapers, there is a special cachet to the word paid. Some advertisers fear that a proportion of newspapers delivered free will be thrown unread into the bin. Where, however, someone has paid for the product, one can assume that it is being read.

The problem on some newspapers is that the marginal cost of getting extra sales – with promotion, advertising, the run-on cost of newspapers and so on – exceeds the actual circulation revenue obtained. That does not mean that it is not profitable to have a higher circulation even at no increase in circulation revenue – because some of that cost might be recouped in extra advertising. On most Australian newspapers advertising revenue is at least 50 per cent greater than circulation revenue; on some it exceeds circulation revenue four to one. That explains by some newspapers are prepared to effectively give away their product to some classes of buyers.

But the bigger the rorts, the more cynical many advertisers become. That’s one reason why many advertisers pay much more attention these days to readership figures rather than claims of paid circulation. Readership figures are based on surveys of the population and, generally, exceed circulation claims by between 200 and 320 per cent: a newspaper brought into the home might be read by three or four people.

The methodology of readership surveys is somewhat contentious – trends, for example, often do not follow circulation trends and, the variations from one survey to another are often puzzling. In principle, however, they ought to be a more accurate guide to newspaper penetration and overcome the problem of dodgy circulation claims.

The latest figures from Roy Morgan Research, for example, say that 119,000 people aged 14 or more reads a typical weekday Canberra Times

; that 174,000 14 plusers read The Canberra Times on a Saturday and 105,000 read the Sunday Times.

Of course the more sophisticated advertisers are interested not only in the net figures. They are interested in just who these readers are. What is the age range – how many young people am I reaching assuming, say, that I am selling CDs, for example. How many men, how many women? What is their average income, or the average income of some of the subsets of customers. Are they of AB, C, D, E or FG socio-economic status? Do they have kids? How old? Do they consume other media – listen to TV or radio for example?

These and many other questions are tracked in the same surveys. An advertiser seeking to sell, say, a common line of grocery items will be looking for a different ideal profile than a person selling fur coats.

Peter Fray

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