Magazines: What’s it all about?

I’ve already looked into advertising on TV and in press, so this week I thought I would investigate magazines. As with all advertising mediums, the magazine industry has changed dramatically over the past few years. The recession and advancements in technology have transformed the industry, both positively and negatively (depending on which magazines we are talking about).

The shelves in newsagents (or any other magazine retailer) are filled with a huge selection of magazine titles. There seems to be a magazine for almost every hobby or interest, from fishing to music or cooking to cars. Magazines aren’t limited to the consumer market; there is a wide selection of trade magazines available. One trade magazine we may all be familiar with is Marketing Week.

As I have mentioned, the magazine industry has been suffering of late. Recently the Audit Bureau of Circulations (ABC) released the magazine circulation figures for January to June 2012 (they only covered consumer titles). The figures weren’t great; circulation of women’s weekly magazines fell by 10.8%, one of the largest drops in the declining market. Other magazines that suffered were celebrity and men’s lifestyle magazines. There were positive results for some, specialist and news sectors performed well. The magazine Style at Home experienced an increase of over 50%.

In the UK, the number of magazines distributed declined by an estimated 28% between 2006 and 2011. There were further concerns over the traditionally stable area of online subscriptions. They saw a mixed bag of results, with several companies posting significant declines.

To get a real picture of how the magazine market is faring, we need to look further than hard copy circulation figure. Magazines are now a multi touchpoint experience; the bigger picture now includes tablet and mobile applications and digital editions to name a few. Digital applications are attractive for publishers as well as advertisers. It has opened up new audiences and targeting opportunities.

Consumer magazines report their paid for digital sales separately from their print sales. For Jan – June 2012 60 magazines chose to report their figures compared to 16 the previous year. The number of paid for digital sales increased by 92% compared to the previous period.

The printed market looks like it will continue to decline, whilst other channels will grow. One title that is adapting to the changing times is Heat; the magazine is aimed at young females. Their circulation decreased to 326,677, but their overall brand reach was last updated at roughly 2.8 million. This looks set to increase again with the launch of Heat TV and Heat mobile.

Generally speaking trade titles have been harder hit than consumer magazines. Up until five years ago trade magazines made the majority of their profit from paid for weekly magazines – most of that came from the recruitment classifieds. When broadband was introduced advertisers started listing their recruitment opportunities online (not necessarily in an online trade title) – withdrawing the profit from hard copy editions.

Now many trade titles generate their profit from their online presence, conferences and events. Some publications such as Media Week and Press Gazette no longer publish hard copies and only publish their content digitally.

I’ve briefly touched upon how the internet has affected the market, but it’s not just about magazines going online. Social media has played its part in the decline of printed titles, whether it is a consumer or trade title. Magazines no longer offer exclusivity in terms of content; a recent example is the Katherine Jenkins and David Beckham rumour. Katherine Jenkins took to Twitter to deny rumours that she was having an affair with Becks, within minutes it was a talking point around the office. It wasn’t that long ago that we would have to have waited until the following week to read the story in one of the glossies.

Essentially, individuals on a consumer or corporate basis are reluctant to pay for information that can be accessed on the internet for free. Online and digital media has opened up other opportunities for advertisers at a lower cost. With tablet ownership expected to increase and the number of publishers moving towards digital channels, the future reporting of these channels will make for an interesting read.

The Little Nuggets

(Welsh average)

  • 19% almost always read magazines
  • 51% are very interested in magazine topics
  • 16% say newspaper and magazine articles on holiday and travel influence their holiday choice
  • 32% magazines give me ideas for how to improve my home

(Source: GB TGI Radio+ 2012 Quarter 2, Kantar Media)

As always please leave a comment below or email me jodi.stuart@realradio.co.uk or tweet me @realradiojodi

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Cunning stunts – The power of ambush marketing

I recently read a short article about how Skinny Vines pranked soft drinks company Innocent in a publicity stunt. The new company, a low calorie wine maker, hung a banner that said ‘Forget the juice… drink wine’ from Innocent’s head office in London. It’s a great example of a nascent branch of marketing that already has some really serious players. The first company that jumps to the forefront of my mind is Paddy Power.

Whether you agree with Paddy Power’s ethics or not, they are without a doubt successful pranksters.  As soon as their adverts are uploaded onto YouTube they go viral, they aren’t scared to step on other peoples/brands toes (which in turn creates endless press coverage).  In 2010 they also took the crown for creating the most complained about advert of the year.

It’s often the case that the publicity their adverts create is valued at more than the cost of the campaign itself.

Most of us will be familiar with some of their marketing stunts, but let’s have a look at some of their most controversial adverts over the last few years.

The Last Supper Billboards – Dublin: 2005

They created billboards with a mocked up image of Leonardo da Vinci’s famous painting of the Last Supper. Paddy Power poked fun at Jesus and his apostles, the image showed them gambling with poker chips, playing cards and roulette. The slogan read “There’s a place for fun and games”. The advertising authority received more than 100 hundred complaints and ordered Paddy Power to remove the poster. The ASA said that the advert breached multiple guidelines referring to taste and decency as well as religion. Paddy Power did as they were asked and removed the posters …….. but replaced them with a new caption “There’s a place for fun and games. Apparently this isn’t it”. Even though Paddy Power had to remove their initial adverts, they did receive a huge amount of publicity both in Ireland and abroad.

Ryder Cup Hollywood Sign – Celtic Manor, Newport: 2010

They had already pulled this stunt a few months before at Cheltenham Races. They erected a 270ft long and 50ft high sign similar to that found in Hollywood, on Cleeve Hill above the racecourse. They decided to dust off the Hollywood sign and resurrect it. This time they hired land from a farmer in South Wales, and up the sign went. They didn’t rent any old field; this field overlooked the Ryder Cup course at the Celtic Manor. After a bit of a scuffle, eventually Cardiff County Council did order the company to dismantle the sign. Paddy Power came out on top again with the amount of publicity this ambush generated. Unfortunately Terry Matthews (owner of the Celtic Manor) added to their publicity by branding them ‘scum’ on national TV. However, we may have seen the back of the Hollywood sign, rumour has it that they managed to lose the sign after taking it down!

Blind Footballer Kicking a Cat TV Advert – 2010

The piece de resistance (aka the most complained about advert of 2010). The advert was run on TV and insinuated that a blind footballer kicked a cat into a tree (only insinuated because they didn’t show
the footballer kicking the moggy). Complaints flooded the Advertising Standards Authority (ASA) office; in total they received 1313 complaints. This not only made it the most complained about advert of 2010, but also put it into 3rd place for the most complained about UK advert at that time. The public claimed that the advert was disrespectful to blind people and may encourage animal cruelty. ASA decided not to uphold the complaints as they felt they were light hearted and surreal.

Imogen Thomas Newspaper Adverts – 2011

This time they enlisted the help of former Big Brother contestant Imogen Thomas. The advert was created to promote its offer to refund all losing bets on Manchester United in the Champions League Final. At the time the claims of Imogen and Ryan Giggs having an affair were flying around. The first advert circulated included the slogan “Imogen can’t keep quiet about this”. They then took it one step too far for some; the next advert showed Imogen blowing into a whistle with the caption “Blow me!” A number of newspapers rejected the wording and pulled the adverts from running.

Stallions or Mares TV Advert – Cheltenham Races Ladies Day: 2012

A particularly controversial advert! The commercial showed transgendered ladies amongst a crowd of racing spectators at the Cheltenham Festival. The voiceover was guessing their gender ‘stallions or mares’. The ASA received 421 complaints and banned the ads. Yet again Paddy Power came out unscathed, they uploaded the advert onto YouTube and was viewed over 600,000 times.

Tranquilise the Chavs TV and YouTube Campaign – Cheltenham Festival: 2012

Cheltenham Festival was targeted again, this time the advert showed a hitman running round the ground tranquilizing stereotypical chavs. The idea came from a fans Facebook comment “Hope the chavs don’t ruin Cheltenham like they did Ascot” (after a drunken brawl broke out in Ascot the previous year). The advert was banned from airing on TV only 4 days into the campaign. It’s still available on YouTube and has clocked up 1,440,016 views.

Bendtner’s Lucky Paddy Pants – 2012

Earlier this year they signed up Danish footballer, Nicklas Bendtner. Bendtner was playing against Portugal when he adjusted his ‘kit’ and revealed his lucky Paddy Power pants. UEFA didn’t let Bendtner off lightly, he received a one match ban and around an £80,000 fine. Needless to say Paddy Power picked up the UEFA bill.

Egg & Spoon Race Billboard – 2012

Paddy Power couldn’t contain their excitement for the London Olympics. They ran the following billboard campaign at three stations in London.

At first Olympic organisers demanded that the billboards were removed. Paddy Power disagreed that the advert violated Locog’s marketing rules; eventually Locog withdrew the request to remove the adverts.

If that’s not enough examples of Paddy Power’s marketing then you might want to check out some of their other controversial campaigns.

  • Cheltenham Racecourse Hollywood Sign
  • Paddy Power Vuvuzela Truck
  • Uffington Horse
  • Paddy Power Takeaway

What’s your favourite Paddy Power marketing campaign? Or can you think of any other companies that have pulled a marketing stunt or prank? Please leave a comment below, email me jodi.stuart@realradio.co.uk or tweet me @realradiojodi

Is it too early to use the C word?

For most it’s probably too early to start writing your Christmas wish list to Santa, the festive period has certainly started cropping up in the business world. My colleagues have already started creating and booking Christmas campaigns for their clients. Recently I’ve come across a few articles about brands such as Dior and The Body Shop unveiling their Christmas collections in September.

Another company that started early was Asda, starting their Christmas promotions four months before the big day. In August they opened 17 grottos at stores around the UK (the grottos were only open for a few days). Staff dresses as elves handed out Christmas savings cards; the cards allow customers to save up to £144 to spend over the seasonal period.

Before forecasting what Christmas 2012 has in store, let’s recap 2011.

  • It was a tough year financially
  • The weather impacted fashion sales – it was particularly warm towards the end of last year
  • Unemployment and redundancy threats impacted purchases
  • Consumers wants a good time
  • Subsequently, consumers spent record amounts in the last 2 weeks of December

Unfortunately, I don’t think we will see any drastic changes for 2012. Financial concerns such as the housing market to the cost of fuel have continued throughout 2012. A year on and we still can’t control the weather, who would have thought that there would be floods in July? Job stability and unemployment is still a concern for a lot of people. On the positive side we still want a good time. It’s the only time of year that we can treat ourselves, friends and family without the burden of feeling guilty.

Now for the good bit……presents!

Whilst I love Christmas (in December, I’m not one that gets all excitable in October unlike some I know) I accept that it tends to be focused around children. So I was surprised to find out, in 2011 toys and games only accounted for 12% of gifts given. Clothing and footwear were the most popular presents and accounted for 17% of gifts given.

Spending on gifts by category, Christmas 2011

Source: GMI/Mintel, Base: 1874 adults aged 16+

  1. 17% Clothing & Footwear
  2. 15% Other
  3. 13% Electricals
  4. 12% Toys & Games
  5. 8% Jewellery
  6. 7% Vouchers
  7. 7% Perfume/Toiletries
  8. 6% Video & PC Games
  9. 5% Books
  10. 5% Music/DVD’s
  11. 3% Household
  12. 2% Experiences

The data in the graph below represents the figures for 2011; the answers are similar to those for Christmas 2010. On the positive side, fewer had to borrow money in 2011 than in 2010. More left shopping to the last minute but far more started early to spread the cost.

The use of Christmas shopping online has increased year on year since 2007. The biggest online shoppers are the 35-44 age group, they are also the group with the most people who bought the majority of their gifts online (rather than some of them). The younger generation lead the way when it comes to new technology, and are the most enthusiastic group when it comes to buying through their mobile. The internet isn’t just used to buy gifts online; a lot of consumers use the web to inspire them for gift ideas.

The festive period is crucial for many businesses, for some the majority of their annual turnover is generated from the Christmas period. If we take household electrical appliance retailers, the sales of white goods are generally purchased as replacements, but brown goods (smaller appliances) and pc related goods are gift items purchased for Christmas. Multi retailers such as department stores also flourish in the festive season; they offer consumers the convenience of purchasing a variety of gifts from one store.

The run up to the festive period is the one time of year that consumers are all looking to purchase gifts. This means the competition between retailers advertising their products is at a peak. According to Nielsen in Q4 2011 £6,352,735 was spent on advertising locally in Wales, compared to £5,555,410 spent in Q1 2011. The industry that spent the most on advertising last year in Q4 was Entertainment and Leisure; some 30% of their total advertising revenue was spent in this period.

It goes without saying that it’s not only retailers that benefit from the Christmas season. Not everyone wants to spend all day in the kitchen or squeezed together on the sofa! The hospitality and catering industry do particularly well in the run up to Christmas. Not only do they benefit from those that want to eat out around the Christmas period, but also with office parties and of course New Year’s Eve.

If you haven’t already started to plan for your business and the Christmas period, then it’s time to start. Other companies (and probably your competitors) already have. If you combine that with the rising number of consumers starting their shopping early, the expression snooze you lose comes to mind.

The Little Nuggets (Welsh Average)

32% find it difficult to say no to their children

13% tend to spend money without thinking about it

50% like to pay cash for everything they buy

74% spend money more carefully than they used too

Source: GB TGI Radio+ 2012 Quarter 2, Kantar Media, Wales BARB region

As always please leave a comment below, email me jodi.stuart@realradio.co.uk or tweet me @realradiojodi

The Facebook Advertising Debate

Facebook advertising is a controversial topic; it seems to generate rather passionate opinions. The big question is, does Facebook advertising work? Like a lot of things, I think the answer is heavily based on individual opinions and expectations.

So here are two imaginary characters that are going to duke it out for us. ‘Derek’ (D) is for FB advertising. ‘Gail’ (G) doesn’t think FB advertising is the best platform to invest in.

I’ll get the debate started…….

Do you think FB advertising works?

D: Yes, if it didn’t why would companies of all sizes continue to use it?

G: No and several large companies have pulled their FB advertising accounts. One that springs to mind is the $10 million General Motors account.

D: Well, at the time GM was emerging from a bailout crisis, they needed to cut costs in order to protect their balance sheet.  The company was reportedly targeted to reduce their marketing expenditure by $2 billion over the next five years. They did what any commercially savvy company would do, worked out what advertising worked best and cut out what wasn’t as successful. Mary Henige, GM’s Director of Social Media tweeted “We have more than 8mil friends on FB; not leaving them; engagement & content isn’t the same thing as advertising.”

G: Quote “cut out what wasn’t as successful.” Do I need to say anymore?

D: FB is a rich pool of data, I’d say pretty accurate too considering users update their profiles as they progress through the different stages of life. It’s also the largest single online community reaching millions of people around the world.

G: Yes FB is the largest single social network platform, it reaches 51% of all internet users but that’s nothing in comparison to Google’s Display Network reaching 90% of all internet users. The information may be valuable; however FB was never designed to be a marketing platform but a communication tool. An apple will always be an apple. Oh and I forgot to mention you can’t reach them through their mobiles!

D: The information available on FB can’t be replicated in the same quantity from any other single media platform; this data is valuable to marketers. It’s not necessarily about the mass reach but more so the targeting options available. Now you can target your ad’s based on demographics such as gender, marital status, geo-graphical area, interests etc…. the list is almost endless.

G: Blah Blah…. You mention the reach and targeting options, which all becomes insignificant when you take into consideration the click through rate. FB don’t actually publish the CTR (I wonder why), but I have come across independent analysis from Webtrends. They looked at over 11,000 FB campaigns and established the average CTR in 2010 was 0.051%. Let’s say a campaign targeted 80,000 impressions, using the average CTR around 40 people would click on the ad. That’s just clicking not buying; yes the conversion to sale will vary from business to business.

D: What do you think to these figures then? In 2011 Facebook made $3.7 billion and 85% of that was from advertising revenue. If it doesn’t work then how are they generating these sorts of revenue figures?

G: Have you seen the FB Q1 2012 revenues? Their earnings fell in the first quarter of 2012; they were 6.5% lower than in the fourth quarter of 2011 and profit was down 32% from the end of 2011. So whilst they have done well in the past, 2012 looks set to be a shaky year for them.

Back to me now!

This debate could have kept going on forever

And it’s not all about Facebook ad’s, they are now testing a new format that will see brands’ page posts appear in users news feeds regardless if they are a fan of their page or not. It’s not the same as the current sponsored stories which require a user’s friend to like the page before the sponsored story is displayed. The sponsored ads appear on both desktop and mobile news feeds, I wonder if users will deem this as socially acceptable.

Using Facebook adverts can be cheap, that’s not the same as cost effective. Because you can stipulate if you want to pay per click or by the number of impressions, it’s could be worth seeing if it is something that would work for your business. There are alternatives out there that warrant further investigation. Check out this infographic, it compares the value of the world’s biggest online display advertising networks: Facebook vs. Google Display Network.

As always please leave a comment below. I don’t doubt that I have missed points from both perspectives so please feel free to weigh in!

Email me Jodi.stuart@realradio.co.uk or tweet me @realradiojodi

Online travel firms investigated for price fixing

Towards the end of July the Office of Fair Trading released a statement alleging some of the world’s largest online travel companies have been involved in price fixing. Other than a couple of newspaper articles, it doesn’t seem to have attracted a huge amount of attention. However, I don’t think this is the last we’ve heard about this scandal.

The OFT started investigating the allegations made by small online travel company back in 2010. The companies involved so far are Expedia, Booking.com and Intercontinental Hotels Group (IHG). At this stage it is thought that the alleged practices are widespread throughout the industry. Essentially the online travel companies banned hotels from selling their rooms cheaply. The online travel companies did this to stop their prices being undercut by competitor agents. If a hotel refused to do so they were threatened with removal from the travel company’s website.

So far Expedia have confirmed they have “engaged in cartel conduct on breach of the law” from October 2007 to September 2010. They are fully co-operating with the OFT’s investigation, it’s reported that they are even providing information on their competitors under a leniency deal. Booking.com and IHG both deny any wrong doing and have three months to respond to the OFT’s investigations.

If found guilty of fixing prices, the OFT can enforce fines up to 10% of annual turnover worldwide. If Expedia are the only company to apply for leniency, they could avoid the fine altogether. Firstly, they would need to prove that other companies have broken the law. If they don’t see 100% of the fine waived it could be reduced by around 25% to 50%. Surely the point of imposing a fine is to deter other companies from offending, or the guilty companies re-offending.

Key statistics from the OFT’s website show that:

  • In 2010, the revenue generated from UK hotel room bookings was approximately £10.1 billion.
  • £849 million of that revenue was booked online.
  • The UK’s online travel agency sector is the largest in Europe, in 2010 the industry turned over around £5.3 billion in 2010.
  • The alleged misconduct between Booking.com and IHG started on the 1st January 2007 and is ongoing.

The investigation isn’t only looking into domestic room rates but also international bookings. It is likely that many UK consumers that have used these sites have being overcharged since 2007. If they are making their reservations through Booking.com or IHG, then it is likely that they are still being overcharged.  It has been suggested that consumers may be able to claim compensation for bookings made with these companies over the last few years.

Consumers use the internet to shop around for the best deals, regardless of the product. Certainly in Expedia’s case (because they’ve admitted it) they have only been in a position to offer the best deals because they manipulated and bullied the market (those weren’t Expedia’s words). The problem was they weren’t the market/hoteliers best deals but all that the online travel agents were prepared to offer.  Depending on the outcome of this investigation and the media exposure it attracts, it could potentially affect consumer confidence in other industries when shopping online. Justified or not!

I don’t think this will be my only blog in relation to this investigation, but for now please leave a comment below, email at the station Jodi.stuart@realradio.co.uk or tweet me @realradiojodi

Also please get in touch if you are setting up a ‘holiday scam claims’ company to talk about advertising 🙂

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