Over on one of the N scale forums there's been a lot of discussion about what's going on with the paper magazines and what that all means for the future of the hobby.
As the publisher of MRH, I track this closely and I have some insight that may help.
For years, the paper magazines have been declining in circulation. Looking at the two leading model railroading magazines, Model Railroader and Railroad Model Craftsman, you can see MR peaked about 1993 and RMC has been steadily dropping since 1980:
(Yes, RMC did not report any circulation numbers in 2002.) I don't think it's any coincidence that 1993 is when the internet first staring coming into its own and that's when the decline in paper magazines started and hasn't let up since.
All the paper train magazines are showing a similar decline, and the train magazines are not alone in this: newspapers and magazines have been steadily declining now for the last couple decades now that the internet has become prevalent.
In fact, when asked in a recent survey if people would rather lose TV or their internet connection, most said they'd give up TV before they'd get rid of their internet connection.
By contrast to the paper mags, below is the growth of MRH since we started in 2009. Since we have no physical magazine to measure (what's an online read count as?), we use unique monthly visitors to our web site to assess our audience size:
We're seeing our growth moderate some through 2011, and we're expecting a 15-20% growth for 2011.
So here's the deal - the paper magazines are dropping an average of 5% per year, while we're growing at least 15% per year - making for a difference of 20%. And our free-to-the-readers publishing model means our upper growth limit is essentially unbounded - eventually, we will be reaching every modeler on the planet who is online.
The other twist in all this is ad rates. The paper magazines continue to raise their rates about 2% per year, even with a shrinking readership. Meanwhile, we have held our rates flat since we started in 2009 and our audience is growing. Now you tell us which advertising venue seems to make the best long-term financial sense if you're a hobby business?
THE HEALTH OF THE HOBBY?
The decline in the paper magazines begs the question - is the hobby shrinking? We don't think so. We've seen some hobby vendor surveys that suggest the hobby is actually growing slowly ... and Reuters has been reporting that the sales of train sets at Christmas time have been on the rise since 2005.
Marketing 101 says the more heads in your market the larger the potential sales. Baby Boomers (born from 1946 - 1965) are a huge segment of the population, and the oldest of them are just now entering retirement. The Gen-Xers (born 1966 - 1985) are a much smaller group, so naturally you won't sell as many trains because there's just a lot less Gen-Xers to sell to.
The good news is the Millenials (born 1986 - 2005) are MORE NUMEROUS than the Baby Boomers! The greatest number of them reached trainset age (age 8-12) at around 2005 - and hey guess what, trainset sales increased!
Marketing 101 - the more heads, the larger your potential market. I'm also seeing more teens and 20-somethings at shows and joining modular groups, so I think the hobby has a good future ahead of it.
I'm hoping that MRH being a digital publication you can get instantly over the web for free will contribute to this increase in hobby interest.
THE FUTURE OF HOBBY PUBLISHING?
I believe the handwriting's on the wall for paper publications like newspapers and magazines. Amazon reported in May of 2011 that eBooks now outsell all their paper books, and the new Kindle Fire "color tablet lite" is sure to simply accelerate that trend.
Apple expects to sell at least 4x the number of iPads they've already sold in the next 18 months, not to mention there will be more tablet devices released in that time.
I think it's clear digital publications are the wave of the future, and the decline in the paper magazines' circulation is only going to accelerate in the next 2 years.
Meanwhile the readership trend for MRH looks to be up-up-up for the rest of this decade, if not beyond. And if we have anything to say about it, we're looking for the hobby to follow suit.