« November 2014 | Home | January 2015 »

Issue for December 2014

The Advertiser: Friend or Foe?

Posted on Tuesday, December 30, 2014 at 12:26 AM

A strategic look at the emerging future of the publisher-advertiser relationship.

By William Dunkerley

For many it may sound like heresy to ask if an advertiser can be a publisher's foe. After all, so many magazines depend heavily on advertising revenue. Advertisers can be our best paying customers. They provide the funds that support our budgets and allow us to stay afloat. What's not to like about an advertiser?

Publishers and advertisers are in a symbiotic relationship. We provide them with access to our audiences, they pay us for that service, and in return they advance their sales or other business objectives. This is a time-tested, age-old formula. Advertising Age magazine credits Benjamin Franklin for printing the first American magazine ad. That was back in 1742.

Times Are A-Changin'

More recent developments, however, are taxing the viability of that symbiotic relationship. I'll describe those developments in a moment. But first, here's the impact: Many advertisers are actively pursuing plans to cut the publisher out of the equation to various extents.

You've probably heard about "content marketing." It is the overall term applied to this activity. Wikipedia defines it as "any marketing that involves the creation and sharing of media and publishing content in order to acquire and retain customers. This information can be presented in a variety of formats, including news, video, white papers, ebooks, infographics, case studies, how-to guides, question and answer articles, photos, etc."

There's nothing new about advertisers engaging in these kinds of activities. What's new is the intensity of focus, and the way in which it is being implemented and distributed.

According to Marketo, a marketing services provider:

Content Marketing has become an increasingly important part of a successful and strategic marketing mix. Today, marketers can become their own content publishers and develop audiences to attract attention. This benefits them in three key ways: it builds brand awareness, creates brand preference, and expands the brand's reach to more buyers and potential customers at a much lower cost.

So it's been one thing in the past when advertisers have produced "collateral" pieces such as white papers or websites. But when there's talk about becoming their own content publishers and developing their own audiences, that puts them into the category of competitors. Curating content and developing audiences are what we've been doing.

There are several factors that have led to this evolving change in the role of the advertiser.

Information Overload

Marketo produced a publication titled The Definitive Guide to Engaging Content Marketing. The report tells readers, "Today, your buyers and customers live in an age of information abundance. They're more inundated by marketing messages than ever -- more than 2,900 per day, by current estimations. As a result, marketers are challenged by attention scarcity -- the concept that the more messages your audience is forced to filter out, the harder they become to reach. So how does content marketing help? Done right, content marketing elevates your brand above those thousands of marketing messages, and becomes the fuel for engagement with your customers."

Changing Consumer Behavior

Smartphones are quickly becoming the go-to device for receiving and interacting with information. They are being used for Web access, email, texting, calendar management, and a number of additional important tasks. Many traditional marketing materials are not optimal for delivery on a mobile device.

Withering Sales Effectiveness

The term "smartphone" may someday be considered a misnomer, what with all the various tasks the device performs. Yet for many people the smartphone is their primary telephonic device. It makes it easier for them to be contacted by people they want to hear from while also making it more convenient to avoid intrusive sales calls. That reduces the efficacy of traditional sales contact techniques.

Antiquated Publishing Paradigms

As advertisers have struggled to keep up with technological innovation and changes in consumer behavior, so have we publishers. But, frankly, we need to be dong a better job of it. The fundamental business practices in the publishing field have been relatively steady for a long, long time. I'm not saying that we haven't changed and made improvements, but there's been no revolution in the way we do business.

But now we are faced not with evolution, but revolution on the consumer side of things. As a result, we now need to meet revolution with revolution of our own.

What to Do?

A lot of publications fared poorly during the Great Recession. It became harder to sell advertising space because existing techniques were not up to the new challenges. Ad revenue shrank. In some cases, budget cuts resulted in editorial and audience marketing getting short shrift.

Those cuts may now be coming back to bite us. If advertisers can put together content and amass audience in a way that serves them better than magazine advertising, it simply means we're not doing a good enough job.

What the advertisers are moving toward is, in effect, a form of vertical integration. They want to take a function that traditionally has been outsourced (i.e., publishing) and bring it in-house.

The concept of vertical integration has a track record of mixed results. A pitfall usually occurs when the quest for doing more things in-house leads a company to divert attention away from its core business. As a result, the core business suffers.

Our Own Revolution

Herein lies our challenge as publishers. We need to revolutionize the utility of our publications. We need to attune them to changing consumer behavior. We need to improve our audience aggregation practices so that our readers will be the best possible prospects for the advertisers. And we need to make our content so compelling that our publications will attract and keep those prospects as loyal readers. If we do all that, we will greatly strengthen our own brands.

We also need to change our messaging to advertisers so that they'll be able to appreciate the ways in which we can outperform whatever publishing they may undertake on their own. That means we must deliver on better audience aggregation and better content development.

There's one other important thing we can offer that no in-house up-start publishing effort can offer. Marketo's Definitive Guide presents an interesting statistic. It claims that "71 percent of consumers trust solutions that provide useful information -- without trying to sell them something." That means that consumers are averse to being attracted by content that is obviously intended to lead to a sale -- like content produced by a seller.

Isn't that a fatal flaw in the idea of advertisers becoming publishers? And isn't that a rare quality that we can offer: trust?

This is a game that is ours to lose. If we can strengthen our own publication brands, aggregate the right audience, and deliver unequaled quality content, it will be hard for anybody to cut us out of the equation!

William Dunkerley is principal of William Dunkerley Publishing Consultants, www.publishinghelp.com.

Add your comment.

Posted in (RSS)

To Count or Not to Count Tablet Circulation

Posted on Tuesday, December 30, 2014 at 12:24 AM

In the news: A major ad buyer will no longer include tablet numbers in circulation guarantees.

In a blow to tablet magazine publishers, ad buyer MediaVest has declared that it will no longer factor in tablet circulation when considering circulation guarantees. Many publishers wonder if this is merely a ploy to drive down ad rates in the face of mounting tablet subscription numbers.

Michael Sebastian of AdAge.com cites Cosmo as an example: "In the first half of this year, Cosmo averaged paid and verified circulation of about 3,019,778 copies, according to its report with the Alliance for Audited Media. But more than 154,000 copies, roughly 5%, were digital editions. Without them, the magazine would not have met its rate base. Most titles face a similar scenario."

Read the complete analysis here.

Also Notable

Rising Print Audiences

This has been a tough year for magazine ad pages, but GfK MRI has recently released fall 2014 numbers that show growing audiences for print magazines. A few print categories in particular fared well: celebrity, fashion, and culinary. Other categories, including women's interest and automotive, saw decreases. However, Eric Sass of MediaPost.com writes, "It's worth noting that many of these decreases probably were at least partly due to the closure of Source Interlink Distribution, which resulted in serious disruptions to newsstand supplies for many retailers." Read more here.

Time Inc. Adopts Bitcoin Currency

Time Inc. has partnered with Coinbase to start accepting bitcoins for certain types of purchases. Readers can now subscribe to several magazines with bitcoins, including Fortune and Travel + Leisure. Earlier this year, the Chicago Sun-Times started accepting bitcoins as payment for subscriptions. Read more about the publisher's bitcoin experiment here.

The Decline of the Sunday Magazine

Once upon a time, four publishers were offering up weekly Sunday magazines for distribution in Sunday newspapers. As of January 2015, Athlon Media Group will own them all. This is not the only recent development in the world of Sunday magazines: earlier this month, it was announced that Gannett-owned USA Weekend would cease publication with its December 28 issue. Read more about the big changes in Sunday magazine publishing here.

Add your comment.

Posted in (RSS)

« November 2014 | Top | January 2015 »