Avoid the Predicted Digital Meltdown -- Part II
Posted on Friday, May 31, 2019 at 1:12 PM
It's time now to get your business in optimal shape.
By
William Dunkerley
Amid warnings from the New York Times
and Editor & Publisher magazine, Part
I took up the matter of an impending catastrophe for STRAT
readers: a serious downturn in the ad market. Now it's time to round out
the discussion with a look at the specific trajectory of magazine
advertising.
The foremost concern, of course, is to find ways of
mitigating potential damage to our publications.
Part I showed
graphically that while digital revenues are trending upward, print
revenues are trending downward. Little media attention, however, has
been given to the reality that print revenues nonetheless still tower
over digital. Mainstream media seems inclined to hype the growth of
digital while giving short shrift to that point.
We also
presented a graph of the relative online interest in digital versus
print advertising as expressed in Google searches. There appears to be a
kind of correlation between revenue and online search activity. The
online interest graph shows the same trend directions found in the
revenues graph.
But the online search interest trend lines tell
us that digital overtook print several years ago. Interest is preceding
revenue reality. I'm not sure how to attribute that. It could be that
publishers and advertisers are seriously looking ahead as the digital
age continues to emerge and grow. Or it could just be a result of all
the media hype about digital growth. Are we seeing something like the
dot-com bubble of the previous decade?
Now we're continuing our
analysis of interest trends for digital versus print advertising, but
with another factor added: "magazine advertising." As before, the graph
is based upon Google Trends research. It shows just relative activity,
not quantified results.
Comparing interest in digital and print advertising with interest
specifically in magazine advertising. The graph covers the period from
2004 to present.
This shows that as the declining interest in
print advertising has leveled off over the past three years, so has
interest in magazine advertising. But the decline from 2004 is far more
dramatic that that for print advertising in general.
That leaves
us to speculate on the causes. One hypothesis I'd like to offer is that
the perceived need for a magazine -- i.e., a curated collection of
articles -- has been diminished by the great availability of searchable
information.
Back in the print era, magazines provided a unique
service. Imagine if there had been no magazines back then. If a person
wanted to pursue his or her informational interests, it would have
required going to a library, fumbling through a card catalog, and then
picking an assortment of books from the shelves. But by subscribing to a
magazine, one would receive a relevant collection of articles with each
successive issue. That was a great service.
Too few magazine
editorial planners have taken today's shift into account. Often
editorial calendars are being formulated as if it's business as usual.
But the game is changing, and it's time to give that serious thought.
We're competing with search, and we don't have any chance of competing
on the basis of speed, convenience, or breadth. (Exactly how to respond
to that is a story for another day.)
For now, I offer two
takeaway conclusions that suggest how to plan for dealing with the
unfolding realities.
The first is to consider that some of the
rush to digital may be a hype-inspired bubble. I'm not predicting a
dramatic burst. But as the industry gains experience with digital, some
early conceptions may fall by the wayside or be redefined.
Take,
for instance, banner ads. For many years we've been pointing out that
banner ads are relatively ineffective. They lack qualities (e.g., size)
that have been proven to impact the effectiveness of an ad. Now,
finally, many advertisers and publishers are coming to that realization.
Reassessment
of digital expectations is happening outside the magazine realm, too. A
friend of mine owns a company that provides digital advertising
billboards. The trend in that line of advertising has been to use a form
of time-division multiplexing of electronic images. The signs present a
rotation of advertising messages, usually from a variety of advertisers.
Things started off with typically around eight images per minute.
But
this billboard scheme also lacks an important component of advertising
effectiveness: that repeat exposure does much to make an ad message
produce results. In the predigital days when a commuter passed a legacy
billboard every day, he or she would repeatedly be exposed to a
particular advertiser's message. With digital boards the chance of
repeat exposure has fallen to 12.5 percent. That surely must take a toll
on effectiveness.
The market may be adjusting to that dilemma. My
friend tells me that many billboards are now trending toward a rotation
of six ads per minute. That may not be enough of a change to make a big
difference, but it's a move in the right direction.
If you carry
over this rotation concept to magazine advertising, you can put into
perspective the folly of programmatic ads that rotate on your pages.
Same problem. Repeat exposure is compromised.
The second takeaway
is to assure that your magazine is performing optimally. That means
creating a close match between your advertisers and readers. In a
business sense that's the goal of any advertising-driven publication.
But in many cases there is a mismatch.
Here's a hypothetical
example of a good match: You want to publish a magazine about fishing.
The lake and stream segment looks promising. There are many businesses
selling to those anglers: fishing gear, baits, boats and motors, apparel
and footwear, etc. But the density of these people is relatively low in
the general public. One solution is to try aggregating readers who hold
active fishing licenses. Providing content that caters to their interest
will attract them as bait, so to speak. That's a good match. Your
readers will be happy to see ads from sellers with products and services
that are of direct interest. And your advertisers will enjoy exposing
their messages to an audience of active buyers.
Come to think of
it, these two takeaways are worth focusing on whether or not a
recession, slowdown, or meltdown is on the near horizon. They're just
good business. I suggest you use the threat of a possible downturn as an
impetus for doing something with them sooner than later.
William
Dunkerley is principal of William Dunkerley Publishing Consultants, www.publishinghelp.com.
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