MEDIACOM Print Marketplace Observations: A Buyer’s Perspective February 14, 2003.
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Transcript of MEDIACOM Print Marketplace Observations: A Buyer’s Perspective February 14, 2003.
MEDIACOM
Print Marketplace Observations:A Buyer’s Perspective
February 14, 2003
MEDIACOM
Agenda Points Magazine Marketplace
Spending Trends and buyer implications Magazines versus other media Magazine Industry Challenge
Magazine Industry Response Concentration on Profitability Developing Better Products
Production issues: Buyer wish list Unique executions Bleed Charges Regional Capabilities
MEDIACOM
Marketplace Observations It’s still a BUYERS market In 2002 total ad pages fell to 225,620, the
lowest industry total since 1996. Advertising fueled revenue growth in the
1997-2000 period and accounted for 65% to 75%+ of the average magazine revenue total
Ad revenue peaked in 2000 at $17.7BB and has slipped 6% overall since then
2001-2002 represented a retrenchment period for buyers where pricing for many clients was “rolled back”
MEDIACOM
Magazine Ad Page Trends
0
50,000
100,000
150,000
200,000
250,000
300,000
1996 1997 1998 1999 2000 2001 2002
Ad Pages
Source: PIB
MEDIACOM
Magazines Versus other Media Despite overall spending fluctuations
magazines’ share of national ad dollars has hovered around 32% since 1990.
32%
6%6%
56%
Magazines
Newspapers
Radio
Television
MEDIACOM
Magazine Industry Challenge The industry has been fighting to maintain or
increase the overall dollar share. While print struggled in 2002 and pricing dropped,
television networks sold out inventory and pricing climbed.
For many clients broadcast campaigns are the last to get cut in tougher climates.
Most brand managers feel they get a better ROI from broadcast versus print.
Some clients are adverse to using print or are strictly broadcast focused. Magazine publishers are forced to be creative and persistent. This will be an ongoing industry battle.
MEDIACOM
Magazine Industry Challenge As a result of ROI pressures more direct
response oriented ads are likely 1-800 numbers used more readily Increase BRC usage for database collection
(especially true in pharmaceuticals). Some titles already carry 4 to 5 RX BRCs per issue.
Monitored website traffic as it relates to ad spend
Magazines with strong response rates will benefit
MEDIACOM
Magazine Industry Challenge Magazines have been hurt by the falloff in
print intensive categories Technology Travel Retail Financial (i.e.: Mutual Funds)
Other categories have helped pick up some of the slack
Pharmaceutical Food Products Packaged Goods
MEDIACOM
Magazine Industry Response Magazines are concentrating on circulation
profitability not just raising ratebase so they can charge more
Effective in 2002 all ABC audited titles had to disclose their average price paid so buyers now have a benchmark.
Magazines have begun to raise basic prices and cover prices. They are also weeding out less profitable circulation.
These are all positives from the buyer perspective as the readers are taking on more of the financial burden.
MEDIACOM
Magazine Industry Response While consumers may pay slightly more they
are demanding more from the product. With the “Martha/Real Simple effect” magazines
of higher quality stock and bigger trim sizes are the trend.
Layouts have more white space and modern graphics
This is great news for advertisers as reproduction has become less of an issue. Even categories such as Women Service, which had historically low quality stock, has improved greatly (i.e.: the new Woman’s Day and LHJ).
MEDIACOM
Print Buyer Wish List Clients are seeking ways of standing out among
ad clutter thru impactful executions i.e.: Barn Doors, French Doors off covers Z-Gates Cover Stickers Popup Inserts Cover Sleeves (Prevention)
Unfortunately many clients become risk averse to the costs associated with these units.
Sales reps should brainstorm more with their production teams to present new executions to clients (everyone wants to say they were the first)
MEDIACOM
Print Buyer Wish List Reduce insert spoilage
Many titles, especially newsstand intensive ones, require a substantial overrun
While we can’t always anticipate sell-through is there a way to lesson inserts sent to the shredder and still buy full circ?
Reduce printing costs on pre-supplied inserts or BRCs I.e. buying a “married” BRC in saddle-
stitched books
MEDIACOM
Print Buyer Wish List Eliminate bleed charges
Aren’t these antiquated production charges or is there still a production cost involved?
Why do many titles (i.e.:Inc.) not charge for bleed yet others do?
Copy-split stop press charges With advancements in technology can these charges
be minimized? Share with us your selective binding
capability. Purchase by demo or even product category usage?
MEDIACOM
Print Buyer Wish List Regional print buying is an issue
Publications define regions and do splits completely different
The CPM premium to do these buys is usually exorbitant (+25-30%)
There are no positioning guarantees, not even just full edit. The same can be said for most demographic editions.
Publish standard material closing dates which are not just the same as space closings.
This would eliminate numerous phone calls to production people
Longer extensions (ie: ship to the printer) would still be confirmed with the pub
MEDIACOM
Looking Forward After two difficult years print
advertising should see a rebound in 2003 Monthlies thru Feb. +11% Weeklies thru Feb.3 +3% Coen’s latest prediction for 2003 +5.5%
Better quality products will continue to benefit both readers and advertisers
Our clients welcome any creative ideas that will help move their business