Caxton recently announced it was withdrawing from magazine publishing and associated businesses in South Africa.
This decision, Caxton said, was needed because of the steady decline in advertising spend in the magazine media sector.
There has also been a continued decline in circulation revenues, which has reduced the viability of the magazine business in recent years.
Caxton is consulting with its employees and is looking to engage with other parties and publishers who would be interested in taking over any of its titles.
Caxton Magazines publishes 12 prominent magazines – Bona, Country Life, Essentials, Food & Home, Garden & Home, People, Rooi Rose, Vrouekeur, Woman & Home, and Your Family.
This news follows an announcement by Associated Media Publishing (AMP) that it shut its doors on 1 May.
AMP published Cosmopolitan, House & Leisure, Good Housekeeping, and Women on Wheels.
AMP CEO Julia Raphaely said they made every effort to continue operating, but the impact of the COVID-19 pandemic killed the company.
The major factors which negatively impacted the company were:
- The closure of printing and distribution channels.
- The global halt in advertising spend.
- The inability to host events in the foreseeable future.
Raphaely said these challenges made it impossible to continue trading, even after investing large amounts of personal money into the business.
How COVID-19 crushed the magazine industry
Caxton GM Anton Botes told eNCA they have seen a steady decline in circulation over the last 7-8 years.
They expected Caxton Magazines to survive for another 3-4 years, but the COVID-19 lockdown condensed the decline into a 2-month period.
Botes said the magazine industry is not classified as an essential service, which meant they could not get their magazines onto shelves.
“As a result of this, advertisers were pulling out and could not continue supporting us,” said Botes.
An aggravating factor was that many stores which were forced to close completely stopped their advertising.
Caxton Magazines currently employs around 250 people, whose jobs will be impacted by the closure of the business.
Botes said the current economic climate also makes it difficult to employ the affected staff in other divisions of Caxton.
“Most people will lose their jobs and where we can find homes for some of these brands hopefully some employees can be relocated there,” he said.
Caxton Magazines has received proposals from companies which are interested in acquiring their brands, however.
These proposals will be considered over the next week. “We will be delighted if those brands can continue somewhere else,” he said.
Moving to digital did not work
Botes said they have been working hard over the past four years to move their magazine brands to digital platforms.
“During lockdown, we have seen between 50% and 100% growth on some of our social media platforms,” he said.
The problem, however, is that advertisers and revenue did not follow this migration from print to digital.
“For every R10 we lose in print, it is hard to make up R1 in digital,” said Botes.
The digital model was therefore not sustainable, which is why magazine publishers worldwide are struggling to find the right solution.
“Right now, we just don’t see a viable business model for Caxton Magazines,” said Botes.