Grocery titles see videos as lucrative revenue source

Folio: The Magazine for Magazine Management, April 1, 1992 by Lisa I. Fried

Hoping to boost ad revenue and expand services to advertisers, Supermarket News in throwing videos into its merchandising bag of tricks.

SN, published by New York City-based Capital Cities/ABC Inc., will create a marketing video for advertisers who buy at least six ads in the magazine. "We're not in the business of making videos. We're looking to help an advertiser coordinate a communications program," says Michael Aronowitz, SN's business manager.

Advertisers pay SN between $55,000 and $59,000 per video. The more ad pages they sign on for, the less they pay for the video. At a minimum, advertisers would have to spend $103,100 to participate in the print/video program. At press time, advertisers' interest in the video program was strong, according to Arnowitz: "We foresee people buying into this program by the end of 1992."

Customized videos for advertisers are distributed to a manufacturer's sales force - the people who convince a supermarket to carry a given product - and to carefully selected retailers and wholesalers. The magazine also promotes the videos in its pages and studies viewer response to them. "It's a tool to help advertisers reach their prospects better," says SN's ad director, David Rothgeb.

Increasing competition

SN's entry into videos will undoubtedly increase the existing competition between SN and Stamford, Connecticut-based Maclean Hunter Media, which publishes Progressive Grocer and produces several marketing and editorial videos for the supermarket industry.

In 1991, SN was the ad revenue leader among 11 grocery titles, while Progressive Grocer took the number-three spot, according to Rome Reports, a division of Leading National Advertisers. Manufacturers, retailers and wholesalers in the supermarket industry have embraced video as a communication device, explains Larry Schaeffer, vice president/publisher of Maclean Hunter's Retail Insights Inc., which has been producing videos since 1984. SN's entry into the field "underscores the value" of the medium, he says. Maclean Hunter's video advertisers do not have to buy ad space in Progressive Grocer.

Fifty manufacturers already pay $8,900 a year for monthly videos on manufacturing news. Schaeffer declined to reveal revenues for his group or what he charges advertisers for video sponsorships.