Category Archives: magazines

iPadonia and the coming ad rebellion

Years ago we met a woman from The Institute for the Future (yes, there really is such a thing) who said, “the mistake people make is overestimating how much things will change 100 years from now, and underestimating how fast things will change tomorrow.” She was right — it’s 2011 and we’re not booking vacation trips to Mars, as 1950s sci-fi writers predicted, but we use tiny glass computers in our pockets to communicate to anyone around the globe. Message formats are immigrating to iPadonia, and unwanted marketing messages aren’t invited.

Tablets will proliferate because the most forceful change of our society in the past 50 years has not been in clunky technology shapes (no home-cooking robots or highway hovercars, alas) but in communication formats. Much of this is silly. The first decades of this century will be recounted by historians as a time of faddish media tweaks: we all watch video and read typography still, yet we’re obsessed with minor nuances in how we do it. 3D TV, streaming Netflix, Apple iTunes, Facebook and Twitter merely reformat text, sound and video. The innovation vectors converge around mobility, with portable glass pads the end point of mental input. Soon, we’ll have windowpanes that do everything, and that will be that.

For a hint of this future, check out Dynamics Inc.’s new smart cards — a type of credit card 2.0 that allows you to tap a button to switch between bank accounts, or hide the numbers on the card’s display until you input a keycode. They are rudimentary compared to today’s iPad, but show the technology of powering variable inputs and outputs now fits into a slender wafer. Compare a Nokia cell phone from 1999 (remember? the one with the little black-and-white screen that was as big as a remote control so you had to clip it on your belt?) to today’s iPhone, only a decade later, and now imagine what the next 10 years could do to Dynamics’ smart card format. Those tiny cards will be tablets connected to the web, pulling in any information you want.

The price for all this will fall, first by half and then one-hundredfold, until smartpads cost $10 and are given away by The New York Times in return for an annual subscription. Tablets will win because they are the end line of print communication format — from carved stone plates to paper to shape-shifting pixels in full color. Sure, producers like Apple will try to defend prices and margins by adding cameras and higher resolution screens in the next few years, perhaps 3D images by 2015, but eventually the tech tricks will run out. To modify a classic quote from Altimeter Group’s Charlene Li, in the future, tablets will be like air.

This unstoppable trend creates conflicts, of course, in business models hinged upon old paper formats. Some journalists and publishers still deny the shifts (magazines still have power! goes one campaign from The Association of Magazine Media), confusing their value as aggregators of news and opinion with what Clay Shirky calls the accident of our society printing words on crushed tree pulp. The medium is not the same thing as the message, and using fuzzy newsprint to read about a presidential speech has no more logic than a writer scratching the news report on the trunk of a tree in your yard. The emotional repulsion journalists feel toward electronic media really is fear driven by the dying pulp-paper advertising model, one where vast reams of impressions are wasted, where marketers pay $10,000 for a newspaper ad supposedly reaching 1 million people, but likely 95% of those readers skip the page B12 that carried the ad and only a fraction of the remainder glance away from editorial copy to read it. Tablets, like web pages, have reduced visual inventory of ads, and as the bloated paper boat of waste sinks, billions of ad dollars may disappear as well. Of course producers of web, tablet and mobile content should not feel smug, because approximately 90% of online ad inventory now goes unsold as well. Most ads are never seen, and much of today’s ad space is going away.

A society voting ‘No’ to advertising

TV is still the king of media, with U.S. consumers watching more than 5 hours each day — but its ads tell the future’s story. In the United States, viewers receive about 130 channels per home, and yet “tune” to only 18 channels each month (people no longer channel surf by turning dials, but instead hit “guide” on the remote or punch in 33 for CNN, leaping to the channels they know they wish to watch). Behind this 86% waste, DVRs are now in 1 of 4 homes helping consumers skip all TV commercials. Billions of dollars flow to those TV outlets, ignored by most people, and while pricing is supposedly based on audiences per channels, eye-tracking studies by Nielsen and Ball State University have found that when TV spots air most consumers look away to read a magazine or peck at a cell phone in their lap. Ad impressions are a currency that is being devalued, and real ad inventory will shrink further as consumers move to on-demand content.

Portable tablets will accelerate this ad skipping, because high-def print and video content on a pane of glass, connected to any provider and sendable to any friend, will trump old formats. Publishers had hoped that iPads would lure new revenue from consumers willing to buy subscriptions for finger-swiped enhanced content; Jason Ary has a nice dissection of the failure of this model. Consumer behavior isn’t really changing; just as your 2011 house still has shingles, in 2021 you will still read and watch video. But the power of marketers to intercept consumers will fade as screens become smaller and more mobile.

How to respond? Advertisers are left with three choices:

1. Notability. Create stories that are talk-worthy enough for consumers to want to pull them onto their shiny panes on the merit of the content. The brilliant 2010 ads for Nike and Old Spice by Wieden + Kennedy, for instance, created millions of conversations. The Mullen agency’s coopting of the Super Bowl into a “Brand Bowl” chatbox about ads lets consumers create a metabuzz about which marketing messages work best. The challenge, of course, is thousands of ads are brilliantly creative and yet society responds enthusiastically only to a handful each year. There’s a lot of randomness in turning a concept into a meme that resonates within cultural context; achieving viral success is like throwing dice in casino.

2. Targeting. The second option is for advertisers to use hyper-targeted media formats that make the remaining ad inventory work. Banner ads, online rich media, and online video are moving away from individual publisher sites — where 90% of ad inventory goes unsold — to ad exchanges, or biddable marketplaces, where the same banners can be targeted against specific audiences at huge cost savings. Tricks such as site retargeting and media-based retargeting chase individual consumers with repeated impressions. Media as stodgy as out-of-home is moving to demographic ratings by billboard location, trying to show they can target better as well. Experimentation in this space is key, and media planning has become a crucial science for getting advertising results.

3. Sponsored thoughts. Or, more darkly, advertisers can blur the lines between editorial and paid messaging. Publishers are toying with this, desperate to keep the ad dollars flowing; no less a publication than Forbes announced last week it would blend articles written by advertisers with its paid staff on the new website, potentially discoloring its authenticity. Sponsored posts and tweets, spammy Twitter direct messages, product placement in films are all what we call “sponsored thoughts” — attempts to trick consumers into believing a paid message came from the mind of the opinion leader or entertainment creator. This creates problems in ethics (is it right to blur the source of an idea?), in influence (consumers confused by the source of the message are uncertain how to process it), and in pollution (there is a tragedy-of-the-commons risk here, if overexploited, untrusted paid communications make the network they ride upon less valuable to users).

In the end, networks are self-correcting, and consumers vote with their feet. We’ve gone through this with telemarketing in the 1990s, in which consumers rebelled by signing up for the Do Not Call list, and email solicitations in the 2000s, which largely have been blocked by spam filters. Media is only as valuable as the audience — advertisers don’t buy ad space, they really buy eyeballs — and the audience migrates to the content it finds most useful, setting up filters around the content deemed an intrusion. Facebook is rising fast because consumers have more control and less marketing interruption. YouTube and Hulu have succeeded by offering immediate choice and minimal advertising. When the inputs and outputs converge into tiny glass screens, the trend of advertisers being squeezed out will continue.

So, pick your solution: Find a way to get more notable, get smarter about targeting, or disguise the source of your message. We recommend notability and targeting … but expect to see more of the third, paid content pollution, as marketers grapple with the shrinking tablet ad inventory held in the palm of your hand.

iPad lures $100k households away from magazines

If velocity is distance over time, the iPad is moving fast. Ipsos Mendelsohn, a research group that studies media habits among affluent Americans, reports that newspaper and magazine use is down 16% from 2009 to 2010 among households earning more than $100,000. (Note: Use means time spent reading, not number of issues delivered to the home.) Mendelsohn’s survey of 13,804 affluent individuals found their Internet use jumped from 22.6 to 25.3 hours a week in the 12-month period. Those $100k households represent one-fifth of the U.S. population, and are one of the sweetest targets for advertisers. With so many eyeballs skipping away from old print, marketers will see declining results if they don’t put mobile and display media in their plans.

Mendelsohn’s president Bob Shullman told ClickZ, “Right now about 98% of the affluents are online — compared with 70% of the rest of the population — and they have lots and lots of digital devices.”

As for the iPad itself, Apple’s tablet is attracting affluent younger users. Nielsen has found those willing to drop $499 on a new technology gadget skew male (65%), younger than age 35 (63%), and relatively affluent (50% of the individuals earn more than $75,000 a year). This contrasts to only 30% of all mobile subscribers making more than $75,000 a year — indicating Apple is locking in the future affluents with its tablet devices.

If you target upscale customers, it’s time to rethink the media plan.

Image: Elsonpro

2010: Year of the oh-so-sexy tablet

We wrote recently that Oppenheimer analyst Yair Reiner has determined the Apple tablet is coming this spring. Magazine publishers are preparing to use the new platform as a savior for their ailing subscriptions and ad revenues — this time, by creating something radically new, editorial content and magazine glossiness plus swipes of video, web interactivity and social media.

Sports Illustrated has unveiled one swanky prototype. Here’s another, by Sara Öhrval of Bonnier, publisher of Saveur and Ski Magazine. Add a webcam to the device and you could even insert yourself, perhaps creating an ego-fueled magazine-publishing-newscast in which you, iReporters, become stars. Sounds far-fetched, but who knew typing in 140 characters would be a fad, too?

Sports Illustrated and the future of print

Is this a real demo or fake? Who cares? There will be a market for this type of video-magazine hybrid, whether or not Mashable’s sneak peek is actually coming. Given the effort Sports Illustrated put into it, we bet it’s here soon.

Rumors abound that Apple will soon launch a Kindle-killing newspaper-saving iTablet; while this may be good news for print, it could further erode the ratings of television and cable as consumers flock to more videos in their laps. It also creates a challenge for old-school print publishers, and your business as well, as we all have to get comfortable creating and sharing video formats. Forget PR copy or insightful white papers; you’ll need to look good under bright lights.

Via Tim Otis.

Magazines play with their bill options

We’re seeing innovation in the magazine sector, which is good since it is shedding pages and titles faster than you can say Microsoft Explorer. The Economist this week announced UK readers can order a single issue for next day delivery — just in case you’ve got to hear about the latest financial panic in 6,000 words or more. lets U.S. readers subscribe to a bucket of magazines for one monthly fee, and mix up the titles mailed to you whenever you want, so you can segue from Maxim to American History depending on when your spouse is out of town.

Magazines have fared better than newspapers with the rise of the internet. Prior to this recession, U.S. ad revenue in glossies rose from $9 billion in 1996 to $14 billion in 2007, hovering at about 5% of total U.S. ad expenditures (which went up in that decade). Newspaper ad dollars fell from 22% to 16% share in the same period.

Still, with magazine ad pages off 26% this year, we suggest anything to get the circulation up.

Memo to publishers: It’s all about controlling the outcome

The death of print has become such a cliché Paul Dailing recently penned an instruction manual on How to Become a “Death of Newspapers” Blogger. Magazine ad pages are off 26%, ad revenue at many larger newspapers is down 30%, NYT is chopping sections and the Chicago Tribune is cutting one-fifth of its editorial staff.

Why are newspapers dying and magazines gasping with asthma? It’s not just about lost readers — publishers have failed to help advertisers predict results, sort of like this card trick.

Advertisers provide magazines and newspapers more than 90% of their revenue, yet it is astounding how little publishers have done to help advertisers get more return from their dollars. Imagine if publications offered advertisers measurement systems to monitor the cost-per-response from every ad format. Imagine if publishers gave advertisers a host of case studies, results forecasts, planning tools, ad formats, tracking phone numbers, and testing schedules to make advertising work better over time. Imagine a print sales rep going over an advertising results report, showing a 20% improvement in marketing ROI and a series of specific steps for boosting ROI another 20% from the print ads in the next quarter.

You haven’t heard of these solutions from your newspaper or magazine sales reps? Funny. Neither have we. Until publications help advertisers control the outcome, expect the death watch to continue.

Reader’s Digest porn

We could debate all day whether this photograph of a topless woman cupping her breast is simply photorealism of cancer self-examination or the explicit depiction of sexual subject matter with the sole intention of boosting newsstand sales. Reader’s Digest is still the best-selling magazine in the U.S., with circulation above 10 million; when such a conservative pub takes its top off, you know magazine publishers are feeling pressure.

The real story of course is how sexual stimulation is the ultimate fallback in grabbing human attention, no matter how much we think we’ve evolved. Humans are still mammals awash in hormones. The Family Safe Media watchdog group estimates there are 68 million daily searches for pornography online, accounting for 25% of all search engine requests. Provocative nudity has been used to sell products since at least 1871. There’s nothing new here; just ask the 1930s’ Rockford Varnish Company. Good luck, Reader’s Digest, getting that circulation up.

Cosmogirl folds. Teens are either upscale or online.

The gut reaction to Cosmogirl magazine shutting down is that teens just don’t read print anymore. The teen pub follows the death of other similar titles, Elle Girl and Teen People. But some media analysts, such as Robin Steinberg, SVP at MediaVest, think the closure could just signal changing tastes. “Teens are not walking away from magazines,” Steinberg told WWD Media. “They are getting more sophisticated in title selection.”

Perhaps Cosmogirl’s teen readers simply grabbed the more risqué Cosmopolitan title. But with three major teen pubs now gone and only Seventeen and Teen Vogue left, the trend line looks pointed to digital, not wood pulp.

Zinio the research tool

Need to know what competing advertisers are doing in a local market? And need to know in, say, 10 seconds?

Zinio, an online magazine subscription site, offers a quick look into a range of publications as part of its free trials. Hit the main site, go to regional pubs, pick a market, and you’ll see onscreen the entire publication in its original hardcopy format, ads and all. A nice tool for competitive research.

The New Yorker to Obama: Shock, then awww…

You’ve probably heard that David Remnick, editor of The New Yorker, is in hot water for approving a cover that depicts Barack and Michelle Obama as Muslim militants, complete with an American flag burning in the background.

Perhaps you also heard The New Yorker defend it as sympathetic satire, skewering the Right’s take on the Left.

What we hear is a lot of people talking and talking about The New Yorker. Well played, Mr. Remnick.