ALA Executive Board
EBD # 12.442019-2020TO:ALA Executive BoardRE:ALA Publishing ACTION REQUESTED/INFORMATION/REPORT: This September 1, 2019-January 31, 2020 report highlights ALA Publishing’s FY20 year-to-date results, offering some specifics by business unit. The specifics include key indicators, highlights, opportunities, and challenges as we look to long-term growth. ACTION REQUESTED BY: Mary Mackay, AED PublishingCONTACT PERSON: Mary Mackay, 312-280-1532, mmackay@DRAFT OF MOTION: None requested DATE: March 19, 2020BACKGROUND: Progress and challenges in the ALA Publishing department and its six business units in FY20 YTD, and how we are positioned for the remaining months in FY20—including perceived opportunities and concerns given the uncertainties facing all businesses in the months ahead. AVAILABILITY: No restrictionsATTACHMENTS: NoneALA Publishing FY20 Performance Summary: September 2019 – January 2020FY20 performance report as of 1/31/20$ and % Variance Actual/BudgetFY20 full-year budgetTotal Revenues$4,330,168($119,170)-3%$11,000,669Total Expenses -Overhead$3,307,092($84,515)-3%$8,492,703Overhead$1,139,427$34,1433%$2,901,967ALA Publishing has been tracking within 3% of budget in both revenue and expense overall so far in FY20, with gains in some units offsetting shortfalls in others. Some accounting processes are still being revised following the recent move to EXL, leading to some delays in posting, and we’re confident that the February report will improve the 3% under in revenue/over in expenses (e.g., $40,000+ of Booklist advertising that would have booked in January will now appear in the February close, and some expense overcharges will be reversed). Given the current ALA financial concerns and the requirements of the FY21 budget, we are looking deeply into how to shift work processes and resources to stay focused on investing where we can grow net revenue while moving more into harvest mode where appropriate. The potential for net revenue is greatest in the areas where competition is also fiercest--advertising sales and sponsorships, subscriptions, and digital opportunities. The new business plans for FY21-23 were presented to the ALA Publishing committee at Midwinter, with each unit focusing on one over-arching goal related to the 5-year plan and net revenue. The FY21-23 plans outline long-term goals, informed by national statistics on key indicators such as print advertising, professional book publishing, and association publishing trends, and ALA strategic directions. Two proposals are being submitted to the Endowment Trustees requesting funding to help develop or shore up new publishing business, one related to repurposing Booklist content and one to support instructors using our textbooks.Increasing average order size and securing more bulk, bundled, and package sales as we work with decision-makers at higher levels and in larger entities remains critical to growth and net revenue. The FY20 experimentation with GovSpend, a platform that identifies where government money is being spent, which organizations are buying what products, when, and from whom, is proving productive. This business intelligence is allowing us to better understand the competitive landscape and providing concrete leads for ALA Editions/ Neal-Schuman, Booklist, ALA Graphics, and eLearning Solutions, with some successful sales and a cross-unit relationship with the military showing high potential. As the unit managers address paths to increasing revenue, we share the general ALA challenge regarding how data on our members, customers, and prospects are gathered, shared, analyzed, and best used. ALA Publishing has strong content and the ALA brand behind us; more granular data and expertise in analyzing and applying it would help us better strategize getting information to the right prospects at the right times. Until the COVID-19 outbreak, we were projecting meeting department-wide goals for FY20, but ALA Publishing now faces the same uncertainties as all other businesses. As of March 19th, we are experiencing significantly reduced product sales, advertisers canceling insertion orders, customers addressing priorities other than their own professional development, and uncertainty around Annual Conference events, so predictions for the rest of FY20 seem unreliable at this particular moment. What are we doing to mitigate this? We are listening closely to our customers, advertisers, and sponsors to learn what we can do to serve and support them and stay relevant and close to them so that they will be ready to spend money with us once things are on better track again. Examples of specific efforts: Booklist Online opened up free to non-subscribers until further notice; ALA Editions/ ALA Neal-Schuman has made e-Books in the EBSCO database unlimited use after a single use purchase until June 30th to allow students to continue to learn using our materials; and American Libraries is partnering with eLearning Solutions to offer free webinars on managing strategies and stress during the pandemic and other related topics. We and our advertisers and sponsors are learning together about digital opportunities such as taking interactive virtual conference sessions, and are engaged in productive conversations about using our digital products (webinars, e-newsletters, podcasts, digital downloads etc.) to help them extend their reach in the virtual realm. The staff is being highly creative in the face of such business uncertainties, and it seems clear that we will emerge from this difficult time with some new possibilities and streamlined workflows. The strong prospects for FY20 for ALA Editions/ Neal-Schuman are so far playing out as projected, with revenue for book titles $157k (14%) ahead of budget as of the end of January and some important new titles still due for publication in FY20, including new editions of Foundations of Library and Information Science, Marketing with Social Media, and Developing and Maintaining Practical Archives. AASL Standards sales, hard to project once they’re in place in many school districts, are running $11,800 below goal YTD. Books supporting use and application of the standards are selling strongly, however.In a continuing trend from FY19, the print advertising market faces industry-wide pressure and Booklist continues to find new digital strategies such as the launch of a new revenue-generating podcast series named The Shelf Care Interview, which has booked over $40,000 so far in FY20. Booklist and American Libraries partnered to offer a joint advertising/sponsored-content proposal to Gale; by leveraging and combining resources, the combined publications expand scale and offer a compelling advertising option that gives advertisers much wider reach than our competitors. This is part of the ongoing effort to partner strategically across ALA to expand scope and scale, and leverage the unique competitive advantages of being part of ALA.American Libraries advertising is shored up this fiscal year by online ad sales on with triple the FY20 budget already secured for that site. The staff continues to explore more digital bundle offerings including new products such as online billboard ads and sponsored bonus episodes of the podcast. They are also seeing some success with custom content. ALA Publishing eLearning Solutions is making significant progress toward closing a Q1 gap in revenue. The RDA Orientation Series for the new 3R project launching across FY20 and FY21 generated over $33,000 in revenue, and more than $10,000 was earned for bulk orders during January with additional bulk orders rolling into February. Moving into the new building should provide better opportunities to look at consolidating efforts across ALA in this area.ALA Graphics continues to investigate new models and ways of working given the steep decline in poster sales, likely to continue. Licensing is proving promising, with some new opportunities under negotiation, and licensing revenue likely to exceed budget significantly for FY20. The unit is working on securing a bulk order from military libraries in FY20, and has trimmed expenses including by shifting to a less frequent, smaller catalog and launching a small store within to avoid expenses associated with creating and maintaining inventory of non-paper products. ................
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