FAJARDO, PUERTO RICO--There's a lot of stormy weather surrounding old media these days, but not the magazine business. Ad pages are up, readership is up, and the future looks bright. At least that's the view of magazine industry executives attending the American Magazine Conference here, which opened Monday on a buoyant note. Thomas Ryder, chairman and chief executive of the Reader's Digest Association, said the magazine industry will benefit greatly from shifts toward a more accountable, digital future. Ryder said magazines will benefit from the decline of TV in particular, which is now in "deep trouble," because "the cost of advertising is rising too fast, and the product is truly dreadful." Ryder said that magazines will be the most efficient place for advertisers to build brands, and that wireless technology will mark the end of postage costs and give publishers the opportunity to personalize content for readers. Newly promoted MPA Chief Jack Kliger noted that changes need to be made in the areas of readership and distribution measurement, as well as postal reform. Kliger called circulation measurement "the ill in the system," noting that other media are measured based on consumption. "Why should advertisers care if a magazine is paid or unpaid?" Earlier this month, the Newspaper Association of America took steps forward in achieving this by measuring so-called pass-along readers--or those who consume newspapers without paying for them--instead of merely subscription and newsstand sales. Kliger added that investment in ROI measurement will help magazines prove their value to advertisers. "We must market the medium as never before," he said, pushing the notion that magazines hold the "key currency" for advertisers: consumer engagement. He noted that product placement directly assaults this core value.
CBS.com will have its stars, writers, and producers do some extra marketing spin by offering up weekly blogs for a number of CBS' prime-time shows. CBS.com is now featuring blogs from "CSI: Miami," "Survivor: Guatemala," "How I Met Your Mother," and "Ghost Whisperer." In the coming weeks, CBS.com will unveil blogs for "Threshold," "NCIS," and "The Amazing Race: Family Edition." Larry Kramer, president of CBS Digital Media, said in a release: "We're confident these blogs will help drive traffic to our sites, while also increasing the visibility of these series on a whole new platform--and build an even stronger relationship with the viewers." For instance, "The Ghost Whisperer" co-executive producer and famed medium James Van Praagh writes a blog providing behind-the-scenes information and goings-on in the spirit world. And for "Survivor: Guatemala," the whole cast of contestants will contribute, analyzing the action and game strategy in Guatemala. In other Internet news, CBS will offer free audio downloads of select CBS programs on the iTunes Music Store. Entertainment, news, and sports shows will include "60 Minutes," "Face the Nation," and "Guiding Light," as well as CBS Digital Media properties, "Survivor Live," "Soap Box," and "NFL Today Hot Topic." CBS Radio News will also be made available, as well as other programming from CBS digital media sites--CBS.com, CBSNews.com, UPN.com, and CBS SportsLine.com.
In his first speech as president of the Magazine Publishers of America, Jack Kliger, who is also president and chief executive officer of Hachette Filipacchi Media, eliminated any doubts as to where the MPA stands on the thorny issue of product placement: "Product placement will only lead to the disintegration of our credibility," he said. "Nothing could be more damaging to our readers." Kliger, speaking Monday at the American Magazine Conference in Puerto Rico, set the tone for the day with a resounding answer to a tough question facing many magazine publishers today: whether to blur the line between editorial and sales--the traditional church and state of the magazine industry. Later in the day, the release of revised industry guidelines by the MPA's American Society of Magazine Editors (ASME) would make it final: product placement has no place in the magazine industry. But not all editors and advertisers agree. "We don't see a reason not to do [product placement]," Steve LeGrice, editor in chief of Inside TV, said--as long as it fits in context with editorial content. LeGrice added that the magazine is currently testing reader response to product placements. Kerri Martin, director of brand innovation, Volkswagen of America, Inc., agreed--adding that from a marketer's perspective, print product placement needs to be tested before it can be discounted as a viable advertising option. Media Planner Jack Hanrahan, OMD's director of strategy, print communications, said that while product placement could prove effective for certain publications, "the vast majority of publishers won't do it"--because he said the paid-editorial line cannot be so easily crossed with magazine readers, unlike television. "TV in many respects needs this," Hanrahan said. "Magazines can add pages, whereas TV cannot." Newsweek Editor and President of ASME Mark Whitaker, who yesterday unveiled the organization's new guidelines at the AMC conference, suggested that product placement could ultimately cannibalize magazines' value to advertisers. "At the end of the day, advertisers are still most interested in our relationship with our readers." Besides, he noted later, "[Marketers] prize nothing more than independent praise of their product." The ASME guidelines for editors and publishers were condensed and largely unchanged in terms of content, with a huge caveat for product placements and sponsorships. According to the guidelines, publishers should not place products in editorial content in exchange for payments or ads, except for advertorials, which need to be clearly labeled as either "Advertising" or "Promotion." Non-recurring special issues or one-time sponsorships that appear as editorial content must also be labeled.
Two TV and media research groups warn that the Federal government's push for digital television by the year 2009 will wreak havoc with TV customers. Research companies Points North Group and Horowitz Associates say a proposed U.S. Senate digital TV bill, which would terminate analog TV service in 2009, could mean a backlash from consumers. The researchers say 55 percent of TV homes, which have cable, have no digital signal--and have no intention of getting it. In U.S. homes, while the primary TV set may be connected to a digital set-top box, second and third TV sets in the home don't have digital set-top boxes. Instead, those TVs get cable signals directly from coaxial cables that run into homes. The research group says this represents about 67 percent--or 180 million television sets--in the United States. "Who is going to pay for the extra box that you are going to need?" asks Stewart Wolpin, senior analyst of Points North Group. "Will the cable company be forced to give you a box?" The bipartisan bill was conceived because of emergency facilities that failed in the wake of the 9/11 tragedies. Federal administrators are pushing to give all analog TV signals--ones that broadcasters currently use--to these emergency services because this spectrum is more robust, and won't fail in times of emergencies. This was designed in reaction to the events that occurred on 9/11, when radio signals were too weak to alert emergency workers--which would have directed them to quickly exit crumbling World Trade Center buildings. Digital signals will be given free to the private sector. But Wolpin says not all broadcasters are ready to spend the money to abandon analog and switch to digital--especially in a short three-year time span, according to the bill's time frame. From a point of view where Republicans typically let the marketplace decide, this bill baffles analysts. "It's surprising the Republican administration is forcing these changes," said Wolpin. The bill has a lot of weight behind it because of its bipartisan effort. The bill's sponsors are Sen. Daniel Inouye (D-Hawaii) and Sen. Ted Stevens (R-Alaska). The bill also has major support from Sen. John McCain (R-Arizona). Cable operators could be adding to the confusion. Right now, 25 percent of cable subscribers have digital set-top boxes, said Wolpin. But while cable operators claim digital is the future, he says, companies are still giving customers analog set-top boxes. Says Wolpin: "It stuns me, from a business point of view, that they are still doing this."
Two weeks ago, The Association of National Advertisers debuted a new logo and brand identity at its annual conference. This week, it's the DMA's turn. At the opening session of DMA05, Direct Marketing Association President and CEO John A. Greco, Jr. assessed the state of direct marketing and unveiled a new brand identity for the Association. "Marketing is changing, and the DMA is changing with it. Our goal in developing a new identity is to reinforce that we're committed to cultivating stronger relationships between consumers and direct marketers, and propelling these relationships forward," Greco said. The new identity reflects the innovation and value of direct marketing across all media, including mail, catalogs, online, e-mail, newspapers, magazines and interactive television, and radio. The DMA's new tag line is: "The Power of Direct: Relevance, Responsibility, Results." In addition to the identity launch, Greco reported that the contribution of direct marketing to the U.S. economy is substantial and continuing to grow in impact. The findings were part of a multi-year economic impact study prepared by Global Insights Research and released by the DMA. The study found that:
With the start of the television season, I had the distinct impression that there were more commercials on the air than there were last year. As my annoyance at the frequency and duration of commercial breaks mounted, I started timing different programs (played back from my DVR) to see if the commercial load had actually increased this season. For the purposes of my test, commercials were anything non-program-related, including, commercial advertising, promos for other programs, opening credits, and next week's teaser. The surprise was that even though there are more breaks per hour for many programs, the commercial load is no greater than last year's. Embarrassed that I was prepared to bash the networks without cause, I wrote off my hypersensitivity to yet another symptom of being too long a member of the media industry. Still, it feltas if there were more commercials. Vindication came on October 12, when USA Today published an article about TV viewers' complaints of significantly more commercials this season. The fact is that hour-long prime-time programs are actually between 40:30 and 42 minutes in length, same as last year. It just feels like there are more commercials. If you really want to feel the pain, consider that with the current ratio, for every two minutes of program, there is one minute of commercials. Quite a price to pay for free TV. Just how much is enough anyway? Consider that in the U.K., one-hour programs have 8.5 to 12 minutes of commercials, about half that of the U.S. programs. Now you know why friends from overseas cannot sit through your favorite prime-time drama while they're in the States. So why would the networks shift from four commercial breaks per hour to five? Right now, more breaks means the pods are shorter. Right now. Every two or three years since 1996, networks have been adding a unit or two per hour to commercial inventory. But with only four breaks per hour, there is a limit to how many commercials you can string back-to-back before viewers start stepping out to wash their cars during the break. With five breaks, another 30 seconds could be added per pod, and it still wouldn't be as long as the old four-break pod. And in a year or two when a five-break pod is as long as the old four-break pod they can go the Clear Channel radio route, cut the standard unit length in half, and start the escalation cycle all over again. Is there an advertising threshold at which people will just stop watching television? No. But technology is providing consumers the simple methodology to stop watching advertising. As marketers move their dollars to other, more effective alternatives, their TV budgets will decay, demand will fall, and fewer commercials will air. At that point the networks' golden goose will become just another animal in the barnyard. I think I'll write a TV script about the decline of television industry advertising. I wonder how many commercials I could sell.