Wal-Mart Purges 1,000 Magazines

DAN ALAIMO

BENTONVILLE, Ark. — Wal-Mart Stores here has cut 1,000 titles from the list of magazines stores can carry, a spokeswoman confirmed.

While the percentage of titles this represents could not be verified, one industry source said the titles represented about half of “authorized” titles stores can carry. Not all authorized titles are merchandised in stores. Therefore, the pulled titles represented 5% of copies going into the stores and 3% of sales to consumers.

Wal-Mart spokeswoman Tara Raddohl would only confirm that the 1,000 titles initially reported in the New York Post was “close to accurate.” “This number includes national and regional publications and a number of titles that, while still accounted for in the sales system, were no longer being printed,” she said.

“As a retailer, we are constantly evaluating our merchandise offerings and adjusting based on customer demand and the availability of retail space. We made a decision to fine-tune our magazine offerings to best fit our customers' needs,” Raddohl said.

Among the better-known titles being purged: Better Homes & Gardens, Ladies Home Journal, The New Yorker, The Economist, BusinessWeek, Forbes and Fortune, according to media reports. Celebrity titles, such as the tabloid weeklies, will continue to be stocked. Wal-Mart represents between 15% and 20% of total retail magazine sales, various sources reported.

“I don't know if it [the 1,000 titles] is a big number, but I think it represents a serious step,” said Bill Bishop, president of the Willard Bishop consultancy in Barrington, Ill., who follows the retail magazine business. It will have a negative impact on smaller publications, but probably benefit those titles that continue to be carried as there will be more space for them, he said.

“Wal-Mart is concluding that there is a greater value in increasing the efficiency and productivity of the magazine section by virtue of rationalizing assortment than there is in becoming a magazine destination where they would have full variety, and people would know them as a place where they would have a high likelihood of finding what they are looking for,” Bishop said. How it will affect the localized selections of specific stores is unclear.

For other retailers, such as major supermarket chains, Wal-Mart's move will “probably trigger an assessment of their magazine merchandising philosophy,” he said.

“Wal-Mart believes that they can improve the revenue and profitability of the magazine category by having fewer titles and giving more display space to the titles that remain,” said an industry source. “This is not a fully tested theory, but many feel it is a reasonable expectation. It is important to note that they are not planning on reducing the amount of space devoted to magazines.”

If the theory is correct, this policy will have a modestly positive effect on overall sales and revenue for the category, the source said. “It is unlikely to have any negative affect on the category as a whole. Naturally, however, the individual titles that are on the cut list will be impacted.”

As to the effect on other chains, “a lot of retailers watch Wal-Mart closely. Therefore if the strategy is successful, it will likely have an influence on how other retailers manage the category,” the industry source said.
Additional reporting by Wendy Toth