Supermarket Cover-Up Dents Cosmo Sales

Folio: The Magazine for Magazine Management, May, 2000 by Susan Thea Posnock

Checkout units are off by 10 to 30 percent, say sources.

Sex sells, but Cosmopolitan's infamously risqu[acute{e}] coverlines may be doing the magazine more harm than good. Back in January, The Kroger Co., the nation's largest supermarket chain with 2,300 stores, put Cosmopolitan under wraps at the checkout after shoppers complained that the display of lines like "Hot Sex Tips" weren't appropriate for all reading audiences.

Representatives from the magazine and from Hearst are unwilling to comment on the shields that are covering the front pages of their issues, except to say that there has been no impact on sales. However, sources close to the situation say that, in stores where the title's coverlines are blocked, sales have decreased by 10 to 30 percent--not good news for a title that derives 70 percent of its circulation from single-copy sales. According to reports, Cosmo sells about 1.2 million copies at checkout counters every month.

"Because the magazine product is so impulsive, whenever you cover up the story lines it has a negative impact on sales," says an executive who asked not to be identified. "We see it currently in Kroger's with Cosmopolitan."

Historically, titles--whether tabloids or adult magazines like Playboy--have experienced significant drop-offs in sales when they were bidden. "Every new magazine issue is a new entity. If people don't know what's inside the magazine, it's difficult for them to determine whether they want to purchase it," says the source.

Cosmopolitan isn't the only title to be covered up, but it's the only one that has been specifically targeted by Kroger's, which operates stores in 31 states. Kroger's spokesman Gary Rhodes says there is no corporate-wide initiative to put the blinders on other magazines, but that each of the 20 different retail divisions within the company makes its own merchandising decisions about what to carry or not to carry in the stores. "I'm not aware of any other titles that are being covered," he says.

A smaller chain, Genuardi's Family Markets, has also sent blinders to its 33 stores in Pennsylvania, leaving it up to the individual store managers to decide what covers to hide at checkout. Among the titles that have reportedly been covered by individual stores are Glamour, File, Marie Claire, Cosmopolitan, Red-book, Self and Mademoiselle.

And if groups like New York-based Morality in Media get their way, any magazine with sexually provocative cover-lines will soon be next. The group, which launched a campaign that provoked Kroger's use of the blinders, is now considering an expansion of its crusade to include drug stores and convenience stores.

John Fennell, executive vice president and COO of Hachette, says that while none of his titles have been affected, he believes the magazine industry must keep a close eye on retailers. "We all have teams of salespeople who call on the wholesaler and the retailer, and it's on that level that the sales force has to impress upon the retailer the need to display the product as printed," he says. "We pay for the right to do this--it's not like the supermarket puts us in there for free."

At this point, Redbook vice president and publisher Jayne Jamison says she isn't concerned about the checkout cover-up. "Our newsstand sales are very strong, so the fact that one small chain has done this hasn't affected our overall sell-through," she says. "It's not really a big issue."

Fennell says he would consider it censorship if any of Hachette's magazines were put behind blinders. "I know many chains have talked about doing it, but as far as doing it to any Hachette product, we have not been affected," he says.

Were this to occur, Fennell says he would be concerned. "A big part of our sale is the cover images and the coverlines. So if it goes to the power of an individual or to a chain to decide and censor a magazine by putting a cover on it, it would affect sale," he says.

                           FOLIO: M&A SCORECARD
                              MARCH 7-APRIL 7
                     A review of selected mergers and
                  acquisitions in the magazine industry.
                    Acquisitions of Magazines and
                             Other Properties
BUYER            SELLER            PROPERTIES
PlanetOut        Libertion         The Advocate, Out, HIV Plus
San Francisco    Publications Inc.
                 Los Angeles
Pfingsten        Mortgage          Mortgage Originator
Publishing       Publishing Group
Cleveland        San Diego
Chris Meigher,   Meigher           Quest
Quest Media LLC  Communications
New York City    New York City
Cahners Business Bolger            Casual Living
Information      Publications
New York City    Minneapolis
                         Acquisitions of Companies
BUYER            SELLER           KEY ASSET
Tribune Co.      Times Mirror Co. 19 consumer magazines includ-
Chicago          Los Angeles      ing Outdoor Life, Yachting and
                                  Popular Science, plus large
                                  newspapers such as Los Ange-
                                  les Times and Newsday
Cahners Business CMD Group        17 regional construction
Information      Atlanta          magazines
New York City