Denominational publishers at crossroads

Christian Century, May 22, 2002 by Bill Cessato

EACH TIME a nondenominational church opens its doors or a Methodist family switches to a Lutheran congregation, signs of receding denominational loyalty mount. The trend is getting some of the blame for once-proud denominational publishing houses witnessing their financial statements tumble into the red.

While many independent publishers have cashed in on religion's renewed appeal, some denominational houses have lost out--in part because of declining brand loyalty. "As we're seeing a trend in the church, we're seeing the same trend in the publishing arena," said Bill Anderson, president of CBA, a Christian trade organization dominated by evangelical publishers and retailers.

On the boom side, according to a recent Association of American Publishers estimate, net sales in religious works climbed to $1.31 billion in 2001 from $1.25 billion in 2000--a 4.7 percent increase that far outpaced the overall industry's 0.1 percent growth. Religious book sales--not including Bibles, testaments, hymnals and prayer books--jumped 53 percent between 1992 and 2001.

Bob Fryling, publisher of the evangelical and independent Inter-Varsity Press, said his company's 30 percent growth since the mid-'90s is harder to replicate for denominational publishers. "I think we have a flexibility of being able to attract people with a wide breadth of perspective and input," Fryling said. "For a denomination, it may be a little more limited to people who are associated with that denomination or its positions."

That limitation has inflicted financial pain on some publishers. Augsburg Fortress Publishers--the publishing arm of the Evangelical Lutheran Church in America--cut 52 employees last year. In 2001 the publisher had a net loss of $7.17 million--much higher than the projected net loss of $3.8 million--according to audited figures reported in late April to the Augsburg Fortress board of directors in Chicago. Marvin L. Roloff, president and CEO, blames part of the financial woes on reduced curriculum sales. "[Congregations] are not afraid to look at somebody else's catalog that comes in the mail," said Roloff. "In our own denomination, there's been a [20 percent] decline in the number of children."

Wanda McNeill, pastor of Lutheran Church of the Reformation in Washington, D.C., says her congregation uses materials from both Augsburg Fortress and independent Christian publishers. "I think Augsburg Fortress is just like a rock," she said. "I know they are going to have good stuff. But I think it's that new stuff that's going to make a teacher excited about teaching and the kids more excited about learning."

Augsburg Fortress's dilemma isn't unique. Denominational publishers nationwide are feeling financial pressure. Congregational Ministries Publishing, founded in 1996, produces curriculum for the Presbyterian Church (U.S.A.). "It was understood that the curriculum publishing department would be self-supporting from its sales," said publisher Sandra Moak Sorem. "And that has not been the case."

Last year the house ran into specific financial trouble with its "Covenant People" curriculum line. In August, it quit developing the series when midyear sales fell behind projected sales by $427,000. Starting in 2003, said Sorem, the church will give the house an annual stipend of $750,000 to help implement a new, easier-to-use curriculum. "I hope that it'll be wildly popular with Presbyterians," said Sorem, who indicated that market research, in spite of the past slump, showed that members still want their own denominational curriculum.

For some, drumming up that internal support remains key to improving business. "A denominational house will live or die within a decade based upon how its current curriculum is being used by its churches and how the next one coming along will be received," said Jack Scott, a vice president at Mennonite Publishing House. During recent years, the company--which carries a $4.5 million debt and has lost 29 staff members through layoffs and attrition--noticed a decline in curriculum, magazine and periodical sales and an increase in company expenses. "Not every denominational house is going to be able to finance curriculum out of today's sales," said Scott.

Unlike the policy of the past, MPH has started to receive funding through church contributions. In addition, the Mennonite Church USA and the Mennonite Church Canada recently loaned the house $2.4 million to pay down debt to outside creditors. "For the house to continue, there's going to need to be greater participation on the part of the denomination," said Scott. "The denomination has decided it very much wants to continue to have publishing, so we are past the `if' stage."

But for others, reaching the outside market has become central. "The more denominationally specific the resource or the more dependent on volume to be viable," says Cyrus N. White, president and publisher of the Indianapolis-based Christian Board of Publication, "that's where we've had the most financial trouble."