Custom Made

Folio: The Magazine for Magazine Management, May, 2001 by Susan Thea Posnock

"We really see specialty media, including custom publishing, growing more quickly than traditional advertising--and once custom publishing projects become entrenched, they're not likely to be killed for short-term savings," says Andy Buchholtz, managing director, Veronis, Suhler & Associates. "They might have more staying power than traditional advertising budgets, which are managed in some cases on a quarter-to-quarter basis."

Bernadette Mahlmann, general manager of custom publishing for American Express Publishing, says her clients are convinced that it's more important than ever to focus on current customers in this economic climate. The company's 12-year-old custom publishing business has grown revenues by 330 percent since 1997, and still anticipates growth in the downturn, she says.

Matt Petersen, executive director of Meredith Integrated Marketing, which includes custom publishing, agrees that clients will be slower to cut off custom publishing dollars. "It's harder to wall away from communicating with current customers than it might be in acquisition efforts," he says. Overall, Meredith's integrated marketing programs, which serve clients such as Iams, Nestle, Kraft and Home Depot, grew from $1 million in revenue in 1996 to nearly $6 million in 2000.

The downturn may actually be boosting the business, at least in certain sectors. "Technology stocks are in the toilet, sales are down and high-tech advertising is being affected in a pretty significant way," says Joseph Braue, publishing director, CMP Media Inc. "However, from a custom standpoint we're finding that technology advertisers are in aback-to-basics, bottom-line frame of mind. They're thinking, 'If I'm going to spend on marketing, it better be well worth it.' That's really good for custom publishing." Braue says if the boom lasts, he expects custom publishing revenue to be double what it was last year.

New custom platforms

The multichannel, digital evolution that has transformed magazine companies during the past five years is also having a major impact on the custom publishing business. Now these specially tailored products are no longer confined to the printed page. Magazines do remain the largest segment, but custom publishers are providing a wider variety of offerings, including newsletters, Web sites, e-mail campaigns, events, and so on. For example, Forbes produces custom titles that have both print and online components, such as IBM Think Research.

Electronic custom publications tripled from 1999 to 2000. Today, one out of every seven custom publications is delivered in an electronic format, according to the year 2000 report on custom publishing from "Publications Management."

"Custom's expanded because of online, and we expect growth to accelerate versus what we would have envisioned in solely print custom publishing," says Buchholtz.

"Electronic publishing is an important component that can be added into an overall custom program," adds American Express' Mahlmann. "We want to be prepared for clients that want to do e-mail newsletters. It's all about integration and trying to hit as many channels as you can," she says.