• by Michael Shields , December 7, 2004

A new study commissioned by the Magazine Publishers of America (MPA) provides compelling evidence in the ongoing campaign being waged by the magazine industry to prove its worth.

Magazines outperformed TV, radio, outdoor, and newspapers, each by a wide margin, in three different case studies culled together by media mix modeler The Hudson River Group.

The MPA sought out the Hudson River Group, which works with various marketers to optimize their brands' return on investment (ROI), given their sizable database and the independent nature of their real-world client data.

In producing the study, "How Media Measure Up: Financial Services, Personal Care Products, and OTC/Healthcare Products" Hudson was able to pull together a variety of case studies from a host of clients in each category, using real world sales results. Multi-media campaigns were selected, and Hudson made certain that outside factors (seasonality, competitive activity, special events) were taken into account.

In each category, an ROI index was calculated for total advertising spending: incremental profits weighed against media expenditures. Then, each individual medium was indexed against that figure using a base of 100.

The result was a consistent margin of victory for magazines in each category. In financial services, which measured 18 campaigns, magazines spending yielded a 240 index. Conversely, all other categories were below the 100 base, except newspapers at 109.

For personal care products, which included 242 case studies, magazines again won out, indexing at 145 versus 110 for TV and just 52 for outdoor.

It was the OTC/healthcare products category where magazines shined the most, delivering an ROI index of 571 versus just an 89 for TV.

Besides examining pure ROI, the case studies also broke out an efficiency index for both magazines and TV - measuring the percentage of budget each medium accounted for versus the percentage of incremental profit for each medium. In each case, given TV's consistently higher costs, magazines were substantially more efficient.

This new study represents the latest output of an ongoing effort by the MPA to dig deeper into measuring magazines' effectiveness while promoting the medium in general. "This is part of a continuing effort to understand the role of magazines in the media mix," said Ellen Oppenheim, the MPA's executive vice president and chief marketing officer.

According to Oppenheim, a growing body of research indicates that magazines complement other media well, yet do not receive their fair share of marketing.

Oppenheim touted the objectivity of the new Hudson Group study. "This is real client data," she said, emphasizing that the MPA had not commissioned the individual cases utilized.

Jane Bailey, vice president of corporate marketing information at Time Inc., who had not seen the study, praised Hudson's reputation as "a solid econometric modeling company."

"The findings do not surprise me and are yet further substantiation that magazines are often underutilized in the ad mix," she said.