Tuesday, April 17, 2012

Advertising remains the key to success on tablets: will publishers see tablet ads as part of an integrated digital package, or as valuable as their print counterparts?

There has, for many years, existed a dramatic disconnect between the demands of digital agencies and the magazine publishing game. In the print world, the target audience was the key – you want to reach young men then you advertised in [name your favorite lad magazine], if you want to reach working moms then you advertised in... you get the idea.

But since the beginning of the digital media era, reach has been paramount. Partially this is due to the fact that it was next to impossible, early on, to identify many properties that had much reach. In the mid-to-late nineties AOL represented one of the few properties that could offer over a million users. At the beginning of 2000, at the time of the merger with Time-Warner, total revenue at AOL was $4.8 billion. It was, to put it another way, the Google or Facebook of its time. (Last year AOL reported revenues of $2.2 billion.)
If you are too young to remember, you should be reminded that while AOL and Compuserve were giants of the nineties, they weren't exactly considered Internet companies they way we think of them today. Both companies created walled off communities that were reached via the web, but were originally bundled without web browsers. In 1998 AOL bought Netscape when it became clear that the future was the open web, not closed communities. It took a while for AOL users to migrate onto the web, but they did and from that point on the future of digital advertising has been dominated by different players – today that would be Google, Facebook, Yahoo, etc.

I spoke this morning to a digital advertising executive to discuss their perspective about digital ad buying is done, and the comparing that to the way a print buy would, or used to be, bought. At first that person completely denied that reach was important, saying that it was all about target audience and costs and total impressions. But in the end that person said, "well, it's all about reach."

Aveeno ad in the tablet edition of
Whole Living. iPad hi-res image here.
To compete against large digital properties for ad dollars, larger publishers have been preaching integrated sales for a while. Digital buys, such as website advertising, or other digital products, have been blended into proposals. If the publisher is large enough, and the client large enough, and the budget large enough, a major publisher can hope to grab a large chunk of change across a group of titles and across a range of products. Bingo, digital sales are up.

But at the core is the print brand. If Meredith (let's say) wants to sell Kraft Foods (let's say) the way the client gets in the door ends up being its print titles. Now I know many might deny this, saying that we have moved to the point were the integrated whole is what is important, but I don't think those people have ever cold called a customer.

So how is a "page" of digital advertising sold into a tablet edition in this scenario? Is it bundled in with the other digital properties, is it evaluated like other digital products, or like the print product? If it is simply looked at like other digital media the chances are that the ROI will be very low for the publisher.

This is at the heart of the MPA's proposed guidelines for evaluating advertising in tablets.

"We certainly did not want to go the way of the web, which is a very different experience, the click mentality, very low CPMs, that's not the way people are experiencing magazines," MPA's head, Nina Link, said told TNM earlier this month.

"On the other hand, it is not exactly the same experience as print. There are enhancements," Link said. "There is the ability to have sight, sound and motion. This platform has more similarities to print than not, but it has a lot of other wonderful things that have not been measured before. So we came at this saying OK, how do we feel about this? and what are some of the things we think would be a very good baseline."

But in the current environment, major publishers (generally) are probably see tablets as fitting into their integrated sales approach. The hope would be, that at some point, tablet circulation can either replace print circulation or be mashed together. In this way, the weight of the print title is not lost. But what if digital agencies simply see all these new digital subscribers as simply more digital eyes?

For smaller publishers, those that are used to having a rep go in and sell month to month, the solution might be to position all mobile and tablet products outside of digital. That is to say, reader engagement of the new platforms are such that they demand to be purchased the way a client previously bought print.

Ironically, larger publishers, those who have adopted integrated sales, may have a harder time presenting tablet advertising as a platform worthy of being evaluated differently than other digital products. B2B publishers, on the other hand, might want to avoid the whole integration question by simply bundling with print, as if this were not a digital product at all. Because so much of the business in B2B is still sold client-direct, or through agencies that specialize in B2B, these publishers may find they are in a stronger position to represent their tablet editions as true heirs to their print magazines. Sadly, B2B publishers, with a few exceptions have been slow to move to both mobile and tablet platforms.