Where have all the pages gone?

Folio: The Magazine for Magazine Management, Sept 1, 1990 by Jim White

It depresses me when a trade publisher gloats over a 10 percent gain in market share- when his industry segment just showed an overall yearly decline in pages of 20 percent. I'm reminded of a movie battle scene where the commander is winning the battle on his North front (where he is), but losing it on the East, West and South fronts. And he is so close to the North battle that he doesn't see he is losing the war to an enemy he has yet to meet.

Specifically, I'm referring to the fact that, overall, the trade print publishing industry seems to be loosing more and more pages to other forms of marketing/communications.

Why? Is the buyer of media sales vehicles less than informed when it comes to evaluating media? I'm sure many publishers, media sales reps and publishing executives might say yes. After all, several studies show the effectiveness of trade print over other media for generating leads from prospects, for selling products (the ARF/ ABP study), and, from a CPM standpoint, reaching a very targeted audience very efficiently.

In fact, anyone who has been in the business of business marketing for any length of time would not argue with the above. What they would argue is whether that "commander" selling them this excellent tool is really doing a credible job of presenting his product in comparison to other media tools.

But, a publisher might ask, why remind a prospect that there are any other tools out there? That battle raging on the East, West and South is the problem of the telemarketing, sales promotion, direct mail, trade show and electronic database people-not me. Is it really?

Where the money goes

Actually, these media forms continue to take major bites out of the business marketing budgets that were once the domain of the print publisher. Here are some examples from a study done by Business Marketing on where the communication budget dollars are allocated.

* $94 billion is being spent.

* $8.6 billion: Advertising.

* $30.1 billion: Direct marketing. (Included in that is $27 billion from telemarketing.)

* $21.0 billion; Trade shows.

* $7.6 billion: Sales promotion.

One could look at the $8.6 billion for advertising and feel pretty good about the "crumbs that fall from the budget table." But take a closer look at the breakdown of that $8.6 billion ad budget:

* $3.0 billion: Trade print.

* $1.1 billion: Consumer print.

* $2.0 billion: Yellow Pages.

* $1.1 billion: Ad production.

And smaller amounts go for directories, outdoor and broadcast. Bad masquerading as good

Well, $3 billion still doesn't look too shabby-or does it? Remember, trade print received about 50 percent of the budget in the red-hot sixties, but now it looks more like 3 percent. I know about all those statistics that show print representing 30 percent of the communication manager's budget-and that works with the above numbers. But the growth tools of the nineties many times are part of the sales manager's budget trade shows, telemarketing, incentives, sales force management), and the money goes there at the expense of the communication manager's budget.

For example, the latest industry figures show direct marketing and trade shows being the biggest gainers, taking 12.3 percent and 16.5 percent of the communication manager's budget. So even though the communication manager's budget can increase 10 percent, the sales manager, directly or indirectly, could easily get a boost to his budget of 30 to 40 percent more, based on the growth of alternate media tools compared to print.

What's happening?

It's called ROI-return on investment. The sales manager likes direct sales tools such as trade shows and the phone because they are more accountable. Top management likes the sales manager's plan because they can see by the numbers where it's going. The trade print publisher has not been able to do that very effectively for the ad manager/ad agency. Maybe that's why published reports show 50,000 ad pages leaving the market during 1985/88, pages being off 5.3 percent in 1989 over 1988, and looking down again for 1990.

Although those 50,000 pages do not represent the entire trade print market, they do come from a representative sample of the publishing industry-516 key magazines serving their segments, and measured by five different companies. The trend is uncomfortably clear.

Turning the battle around

The only solution for this weary publisher "commander" is to use the tactics of his "unseen" enemy. These are the people with the great growth numbers:

* Telemarketing, 140 percent over two years, in some segments.

* Sales promotion, 26 percent in 1989.

* Direct marketing, 14 percent.

* Trade shows, 17 percent.

The best approach is to utilize the one thing the new enemy would kill for: the dedicated magazine reader. Publishers sell this gold mine to anyone and everyone with no thought that they arc giving away the best part of their competitive strategy. Why not protect that list and use it against the new competition by selling what they sell-ROI-based accountable programs that include telemarketing, trade shows, direct marketing, event marketing, video magazines, electronic databases and electronic magazines, training videos and "custom" industry seminars. Believe me, there is no vendor of communications one-on-one services that can top the credibility and loyalty of a trade magazine and its reader.