Mexico, we are told by the experts, should most appropriately be compared to Spain from a publishing perspective, rather than strictly a country of 100 million.  When looked at from the standpoint of literacy, per capita consumption of magazines and books, heavy television viewing, and education, Spain seems an appropriate model.  And Spains a pretty good magazine market.

Mexico, feeling the draft from other developing nations, particularly China, seems absolutely rabid about the education of its children.  In some respects technology is moving faster than book distribution.  Within a few years every Mexican school is expected to have wireless Internet service.  This development will drastically improve the reception of information from outside but will also permit the developments of communities, especially in indigenous areas where customs, languages and social mores are being lost.

In this regard Mexico might be similar to China, Thailand, and other Asian countries where wireless technologies are being adopted at a fast clip, often faster than in the US or Europe.  Obviously, these developments have enormous consequences for newspapers and magazines, as panelists at the recent FIPP conference in New York suggested.  Technology is increasingly providing consumers with a variety of screens to view content.  And this is hardly restricted to the developed world.  Inexpensive (and often crude) wireless technologies have given this prerogative to everyone and can be found in some form in most parts of the world.  Perhaps this is appropriate technology at its best.

In China, there is a certain disconnect between a relatively small consumer magazine industry and a very robust Internet business.  A similar disconnect exists between Mexicos wireless dreams and the consumer magazine market.   Camara Nacional de la Industria Editorial Mexicana (CANIEM), an association which represents both books and magazines, has about 60 magazines members, of which half are substantially dependent on advertising.  Editorial Televisa, NOTMUSA, and a few others control between 50-60% of the advertising and circulation markets.  Televisa has increased its dominant position by recently acquiring Editorial Cinco, which publishes twenty titles in Mexico.  The anticipated sale of Grupo Editorial Expansion is evidence of further consolidation and is the rare instance in which an outside investor entered the market with a clear exit strategy. 

Mexico indexes high for television viewing and that is where most of the advertising goes.   Magazines get approximately 5-6% of the total ad spend or about $300 million USD.    CANIEM has been very active of late, forming its own industry coalition to better sell the category.   The organization has also conducted reader engagement research, a significant advance over the usual industry statistics.  The emphasis is on myths vs. reality.   This research emphasizes that Mexico, contrary to usual perceptions, is a nation of magazine readers with 66% reading 2-3 magazines a month.  Importantly, the study also describes the emotional and psychological connection the reader has to the magazine.  As other research has shown, the CANIEM effort demonstrates that magazines readers do far less multitasking than consumers of other media.  Mexican magazine buyers consider magazines the medium that provides superior information.  And magazine buyers powerfully influence product sales.

Much good has come to Mexico in the last five years.  Inflation has cooled.  Investment is up.  National debt has been reduced significantly.  And the magazine industry has grown in sophistication.  Televisa seems to have reinvented itself and has emerged even stronger.  Readers Digest Selecciones remains the gold standard in direct response marketing and customer acquisition.  Conde Nast Mexico has shown good growth. Expansion has nicely positioned itself for the expected sale under the direction of John Reuter.   Grupo Medios, Impresiones Areas, and Mexico Desconocido have established themselves and the latter is already testing the US Hispanic market with its travel title.  Grupo Editorial Bauer Mexico has quickly found an audience for In Touch and other titles.  NOMUSA has enjoyed impressive circulation gains. 

Mexico is developing a sector of well-run, competitive magazines that collectively are forming a strong presence in the middle of the market.  The country faces challenges.  There is talk of testing cover mounts and secondary distribution at popular dollar stores.  And companies lack price leverage in a market with a dominant players.

But in terms of business practices, entrepreneurship, customer acquisition and research, Mexico has come a long way and deserves further attention from international publishers.

CANIEM hopes to next conduct advertising accountability/ROI research.

Charles McCullagh

Vice President/International

June 30, 2005

cmccullagh@magazine.org