At a time when news and articles are available at the click of a button, the closure of a store selling print magazines might seem like a natural part of the digital transition.

But what if these stores serve a greater economic purpose than simply selling print publications?

This question caught my attention after I read an article in The Guardian discussing plans to close up to 150 stores in Britain that previously operated under the name WH Smith before being rebranded as TG Jones.

For the writer, the problem is not just losing a place to buy magazines. It is also the disappearance of a space where readers could discover new interests simply by browsing the shelves.

For me, there is another economic aspect worth discussing:

What happens to a product’s revenue when the place that helped customers discover it disappears?

A store is more than just a point of sale

When you walk into a store to buy a particular magazine, you might notice another one you didn’t know existed, browse through it, and perhaps decide to buy it.

This simple process represents an important marketing opportunity for the publisher.

Having the magazine on the shelf makes it visible to people who were not already looking for it, without the publisher having to convince each person individually to visit its website.

I see the store as serving two purposes: selling the product and introducing it to customers.

When points of sale disappear, publishing companies may lose not only direct sales but also the opportunity to reach new customers.

That makes the decision to close stores more complicated than simply cutting rent and operating expenses.

Is print really a dying industry?

It is easy to assume that print magazines no longer sell because digital content has become so widespread.

But the figures cited in the article paint a more varied picture.

BBC Gardeners' World magazine recorded an average monthly circulation of around 164,807 copies, while Country Living recorded around 107,596 copies.

These figures do not mean that every print magazine is financially successful, but they do point to continued demand for some specialist publications.

This raises an important question: if there is still an audience willing to buy magazines, why are the places that sell them in decline?

In some cases, the problem may lie with the economics of the retail stores themselves, rather than a lack of demand for every product they carry.

Publishers and store owners operate according to different financial models, and what is best for one may not be best for the other.

Cutting costs may shift the problem to someone else

When a retailer closes a branch, it may eliminate expenses such as rent, wages, utilities, and operating costs.

From a management perspective, the decision may be justified if the branch is consistently losing money and there is no realistic opportunity to improve its performance.

But the impact does not stop with the company that owns the store.

A publisher that relies on that branch to distribute its magazines may lose some of its reach with readers.

The publisher then has to look for alternative channels, such as direct subscriptions, online stores, or distribution through other outlets.

That may entail additional spending on marketing, shipping, subscription management, and customer service.

In other words, one company’s cost-cutting can increase costs for another company in the same value chain.

Switching to subscriptions is not a cost-free solution

Direct subscriptions may seem like an ideal alternative for print magazines because they give publishers a direct relationship with readers and more predictable revenue, as long as subscribers stay.

But this model comes with different challenges.

Someone might buy a magazine in a store on a whim, while a subscription requires a decision in advance and a financial commitment for a set period.

The publisher also needs to attract subscribers, retain them, and persuade them to renew.

This is where the concept of Customer Acquisition Cost (CAC) comes in.

If a magazine relies on digital advertising to attract readers, the cost of acquiring a new subscriber may rise, especially as competition for consumers’ attention increases.

It is also important to consider the customer’s value over the entire subscription period, not just the amount they pay the first time.

That is why I believe the success of a shift to subscriptions depends on a publisher’s ability to build an ongoing relationship with readers, not just offer a digital edition or a delivery service.

Can algorithms replace magazine shelves?

One intriguing idea in The Guardian article is that browsing at random can help people discover content outside their usual interests.

Digital platforms, by contrast, rely to varying degrees on algorithms that recommend content similar to what users have preferred in the past.

This also raises a business question.

Algorithms may help publishing companies reach the right audience efficiently, but they do not necessarily ensure that they will discover a new audience that was not already looking for that kind of content.

In my view, the economic value of browsing in stores is that it gives products a chance to attract customers who are not part of their usual audience.

That opportunity may be difficult to measure, but it could be important to the growth of specialist magazines.

What does an accountant see?

When an accountant sees plans to close 150 stores, they do not look only at the expected savings on rent and wages.

They also start asking other questions:

How much revenue will the company lose after the closures? Which costs can actually be avoided? Are there costs associated with terminating contracts or restructuring?

For publishing companies, different questions arise:

How will the cost of distributing each copy change? Will the cost of acquiring a reader rise? What contribution margin do store sales generate compared with direct subscriptions?

In my view, this case shows that decisions should not be evaluated solely by how much cost has been cut.

A company may save money in one area but, in turn, lose a source of revenue or an opportunity to reach new customers.

Moving to digital distribution may reduce printing and physical distribution costs, but it adds technology and marketing costs that need to be assessed.

So I do not think the real question is whether print magazines will disappear in the face of digital content. It is how publishing companies can develop a business model that preserves the value of their content and makes it financially viable to reach readers.

A product may be good, and people may want to buy it, but that is not enough if customers cannot discover it or access it.

So perhaps the most important question is not:

Do people still buy print magazines?

But rather:

If the places that introduce people to these magazines disappear, where will their new customers come from?