PUBLISHING AGENCIES: IN SEARCH OF PROOF

Many publishing agencies are intelligently tackling the age-old chestnut of return on investment. Jim Curtis reveals the different methods of measuring the effectiveness of customer magazines.

Customer magazines may be one of the fastest-growing communication channels over the past decade, sustaining an industry worth around £300 million per year. But it remains a medium which has to work hard to prove itself. This is probably because of its relatively young age and the lingering suspicion among some clients that a magazine is a glossy, expensive and slightly fluffy luxury.

However, just as the radio industry, under the Radio Advertising Bureau, used proof of effectiveness to turn itself into a competitive advertising medium, so the customer publishing sector is investing heavily in measurement and research to prove its worth.

Hilary Weaver, the Association of Publishing Agencies' director, admits: "We would rather not be justifying our existence every day, but we have to. We're still fighting to be up there with other disciplines."

Weaver says the complexity of a customer magazine is the fact that it straddles marketing's notorious "line". As customer magazines play the twin roles of raising awareness above the line and, like direct marketing, influencing behaviour, evaluation can be difficult. Yet Weaver insists: "We can prove effectiveness and those clients who use magazines well will tell you how valuable they are."

The APA plays an important role in proving that customer magazines work and has just released new research on the subject, commissioned from Millward Brown. The survey reveals that the proportion of readers who claim to have bought something as a consequence of reading a customer magazine has grown from 47 per cent to 57 per cent. The survey also shows that 64 per cent of consumers say they think customer magazines are a better way for companies to communicate with them than other forms of marketing. Weaver says these findings provide "very strong evidence that people not only like magazines, but that they deliver for clients".

If customer titles were struggling to convince clients of their worth, then they should have fared badly during the ongoing recession, when all but the most essential marketing expenditure was slashed. But, according to the latest estimates, the industry has held its ground. Steve Martucci, the planning director at Redwood, says: "There hasn't been a lot of growth, but not much attrition either. There have been some accounts shifting agencies, but few getting out of magazines altogether. I think that shows how much clients understand the power of the medium."

When it comes to proving effectiveness and return on investment, Martucci points to one of his agency's most successful titles, Boots Health & Beauty.

Mailed to the two million most valuable Advantage Card holders four times a year, the magazine is a sophisticated tool. The smart chip on the Advantage Card allows Boots to test the response of magazine recipients against Advantage Card data, giving it a transparent view of to what extent the magazine affects sales.

Results show that in the three-and-a-half years since it launched, the magazine has delivered sales uplifts of 6 to 12 per cent per issue. Coupon redemption averages about 25 per cent, and sales uplifts for products featured in the magazine vary between 14 to 49 per cent.

Under Martucci, Redwood has built a planning department apeing advertising and direct marketing agencies' approach. Now, other publishing agencies are taking the same approach, perhaps realising that a strong planning function is a good way of retaining business.

Just Customer Communication is one such example. Now part of the Interpublic network after its acquisition by the McCann-Erickson World Group, Just is accessing measurement resources which it can adapt to customer magazines.

It recently unveiled an evaluation tool which it says can track uplift in brand affinity and link it to magazine readership. Just's chairman, Julian Treasure, says that the tool, called Brand Engagement Ladder, is "a consistent methodology which provides clients with industry-standard results". But perhaps the most important message BEL sends out is that Just's new ownership structure gives it previously unavailable planning expertise.

Treasure says: "The relationship publishing business hasn't traditionally employed the same heavyweight planning seen in ad agencies, but we must now apply the level of rigour clients are accustomed to in other areas of marketing."

Having said that, some of Just's titles are already proving their worth with existing measurement tools. For example, RAC Magazine (circulation 1.6 million) is proving a powerful revenue generator. According to Just's managing director, Grahame Lake, every pound spent on the magazine generates £9 in revenue. He cites a promotion for RAC Insurance Direct, which generated more than 600,000 calls and was worth £400,000 in conversions. RAC Magazine is one of the titles included in the APA's Showcase - a collection of case studies demonstrating effectiveness and best practice.

Ultimately, the effectiveness of a customer magazine comes down to what its objectives were in the first place. Where RAC Magazine is focused on cross-selling the RAC's products, a magazine such as Haymarket Customer Publishing's Army is all about boosting recruitment. Through the magazine, the Army has built a 90,000-strong database of 13- to 16-year-olds interested in pursuing a career in the Army, and 35 per cent of readers over 16 have followed that interest through by joining up. The magazine was voted Customer Magazine of the Year at the APA's annual awards in November and is also featured in the APA Showcase.

But to achieve clear measurement and proof of effectiveness, clients also need to raise their game. For the agency to get the best results, clients need be consistent in what they want from the magazine. Weaver says inconsistent client objectives often undermine agencies' efforts to demonstrate effectiveness. She concludes: "The ability to measure and prove what we do is crucial to the sustainability of the industry."

FACTS ON READERS

- 70 per cent of the UK adult population are engaged readers in at least one customer magazine

- 40 per cent of people strongly agree that customer magazines are a nicer way for a company to tell them about its products and services than other forms of marketing

- Readers spend, on average, 29 minutes reading a customer magazine

- 54 per cent agree that they have bought something as a result of reading a customer magazine

- 71 per cent agree that a customer magazine gives the impression that a company is doing well

Source: The Henley Centre/Redwood/QRS.

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