Category Archives: Uncategorized

Magazines (like Newspapers) Are Not Going The Way Of The Dinosaurs.

magazines-705885_640Mediabids is the ”newspaper and magazine advertising marketplace” but you can be forgiven for thinking we only work with newspapers. Admittedly, here and in other forums, we do talk about newsprint a lot. Over 80% of our revenue from performance-based ad placements comes from newspapers, so we may have a bias. However, a growing portion of our ad placements and response is from magazines. So far in 2016, in fact, response from magazines is up about 15% versus the same period in 2015.

Arguably, digital media and mobile devices have disrupted the magazine industry as dinosaur-990303_640 (1)substantially (or more) than newspapers. The conventional wisdom, also similar to newspapers, is that magazines are terminally ill and will go the way of the dinosaurs before too long. But magazines are proving to be very resilient and increasingly well positioned to capitalize on several important trends.

The who, what and how of the present and future superstructure of marketing includes data analytics, content marketing and mobile distribution channels. Magazine publishers would be the first to say they know their readers very well, they are expert content creators and marketers and they are increasingly adroit at exploiting the promise of mobile devices.

Through 2019 magazine ad revenue is projected to be up slightly but more importantly, digital ad revenue is expected to grow at a pace that exceeds any losses in print ad revenue; and this will be true for consumer and trade magazines alike.

http://www.marketingcharts.com/traditional/us-online-and-traditional-media-advertising-outlook-2015-2019-55869/

Post by Jim Jinks.

 

 

 

 

Factoring CLV into CPA Advertising

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An article in MediaPost this week offered an insightful view on why the lifetime value of a customer should be a prominent consideration in the equation evaluating the metrics of CPA advertising.  By factoring in the long-term return on investment of capturing a particular audience instead of solely looking at the cost per acquisition, you are getting a more accurate view of the overall value of the campaign to the business.

“Rather than look for volume, advertisers should consider focusing on the quality of the conversion itself,” the author writes.  Here are Mediabids, we couldn’t agree more.  We see this strategy considered by our most expert advertisers all the time.  They are willing to pay more for a lead from print than what they pay an online affiliate network because a) they know the conversion rate in print is higher and b) there is greater long term value in that customer.

Take as an example an online flower retailer.  They may capture a new customer with an aggressive discounted offer for Mother’s Day flowers one year.  Assuming they deliver on the quality and expectations of that customer, they now have the opportunity to retain them for future lifetime purchases.  Cultivating additional value and increasing the spend of that consumer over time – further improving the overall CPA of that initial campaign.

To illustrate: If they’re offering 20% off a $40 product and paying their affiliate $10 per sale, the initial sale costs them $18 ($8 discount + $10 per sale).  But assuming they can utilize less costly customer retention email programs to generate repeat purchases from that individual consumer in the future (potentially at full price), that initial $18 could generate a $40 annual spend every Mother’s Day for 10 years.  Not to mention other holidays (Valentine’s Day, birthdays, graduations, etc).

On the flip side, consumer behavior indicates that shoppers utilizing Groupon or a similar coupon code site are always on the hunt for the best bargain.  They’ll buy something once because it’s available at a discount, but won’t return.  According to a Rice University study, only 20% of Groupon consumers become repeat customers.  The low lifetime value of these customers drives down the relative success of that CPA campaign.

Obviously there are many factors for companies to take into consideration when choosing where to allocate their advertising budget.  But with such high conversion rates, potential for increased lifetime value, and an affluent and unique audience with little overlap from other mediums, performance advertising in print is certainly worth adding to the mix.

Post by Darcy Mauke.

Weird Week

Does anyone else feel like last week was weird?

Trump Taco

I’m actually not even talking about the fact that Trump became the ”presumptive nominee.” But don’t get me wrong, that is weird!

The weirdness of the week, I’m referring to, was the ton of mixed messages emanating from the advertising trade media.

Here are a few of the highlights:

  • Editor & Publisher ran a story that more than hinted at the idea that people are sick of digital news and are, more and more, going back to reading newspapers in print.

http://www.editorandpublisher.com/feature/as-digital-fatigue-sets-in-readers-are-waking-up-to-newspapers/

  • News hit Tuesday that the Tampa Times was buying and closing the Tampa Tribune.

http://www.poynter.org/2016/tampa-bay-times-buys-and-folds-the-tampa-tribune/409819/

  • The Tampa Trib news was followed on Thursday by the surprising announcement that The New Day, a new British daily from Trinity Mirror would be shut down; after less than three months removed from its highly publicized launch.

http://www.telegraph.co.uk/business/2016/05/04/trinity-mirror-to-close-the-new-day-just-10-weeks-after-launchin/

  • Then to make things really interesting, at least from my perspective, there was this provocative post on Venturebeat.com. The suggestion was that mobile advertising is too fraught with unknowns and outright click-fraud, that advertisers need to simply stop wasting their budgets on it until the issues are sorted out. I wholeheartedly agree.

http://venturebeat.com/2016/05/05/open-letter-to-cmos-stop-all-mobile-advertising-immediately/

So if you’re keeping score:

  1. People are tired of reading digital news and newsprint is still valued by readers.
  2. Newspapers are still struggling with costs and still closing.
  3. Advertisers are pouring money into mobile advertising but it’s a complete waste of money.

These stories all have some essential truth to them but the larger reality, for advertisers, is that their ad agencies simply don’t know print that well anymore (they’ve been too busy chasing all the shiny objects for the past decade.)

The reason why last week was so weird, for us at Mediabids, was that the news hardly seemed newsworthy, especially regarding the notion of digital fatigue and the pitfalls of mobile advertising.

Search marketing and mobile advertising have been the two categories of ad spend that have grown the most in recent years. The ”success” of these ad categories have been based on the ”measureable results” they deliver for advertisers….and as we all know, many advertisers are increasingly reluctant to spend dollars on anything that isn’t measureable in some way (clicks, likes, followers, site visits etc.) Search conversion rates are considered to be the best among all digital media, averaging 2%-3%. Mobile conversions, really good ones anyway, are generally about 1%.

If you’re an advertiser, here’s the thing you probably don’t know (and wouldn’t realize given the stream of negative news reports that tend to emanate from the world of print media) print advertising converts at an extremely high rate. In short, print media puts digital (and all other media) too shame. In terms of calls, our print advertiser have averaged about 32% this year (and this is typical for the past decade.) To be clear, this 32% average is of about 40 different advertisers; meaning some convert much higher and some convert lower but all of our advertisers are well above conversion rates in digital and other media.

If measureable results is your thing, mobile advertising has been disappointing and your search budget is maxed out -it’s time to give print advertising another look. This isn’t news. This isn’t ”what’s next.” This is what makes sense.

 

Post by Jim Jinks.

 

 

 

Happy Mother’s Day

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Check out a few of our favorite Mother’s Day ads this year…

JetBlue is giving passengers a reason to smile every time a baby cries on their flight, in honor of Mother’s Day:

https://www.youtube.com/watch?v=xQyfu1LrOSM

 

A new outdoor campaign from agency Mother New York features warm advice from mom:

http://www.adweek.com/news/advertising-branding/moms-ny-agency-offer-hilarious-advice-their-kids-new-outdoor-campaign-171200

 

We love this satirical ad for Organic Balance breakfast drink targeting working moms. #Blessed:

https://www.youtube.com/watch?v=bh19YxASA-4

 

Apple captures videos and photos of Moms, shot on iPhone:

https://www.youtube.com/watch?time_continue=30&v=NFFLEN90aeI

 

Pandora spotlights unique thank you messages from daughters to their moms:

http://www.adnews.com.au/campaigns/pandora-celebrates-women-for-mother-s-day

 

Even though a reported $22+ billion will be spent on Mother’s Day this year, here’s an article from MediaPost on what moms really want for Mother’s Day…

http://www.mediapost.com/publications/article/271694/what-moms-really-want-for-mothers-day.html

Happy Mother’s Day from Mediabids!

 

We All Have Good Days & Bad Days

Of course, wdays of the week.pnge all have days that are better than others. Well it’s the same for advertisers.

Anyone running an AdWords campaign knows their conversions are better on certain days, not to mention certain times of the day.

In print advertising, newspapers in particular, there is generally more than one day of the week that is promoted as a really ”good day” to be in the paper. For example, Sundays are thought to be a good day because it tends to be the highest circulation day of the week. Thursdays are also thought to be a good day – especially for car dealers or other retailers- because announcing a weekend sales event on Thursday makes good sense. Finally, in many papers, Wednesdays are thought to be a good day because it happens to be the day the paper distributes all the week’s FSI shoppers and flyers. In any given paper, the ”conventional wisdom” is that Wednesday, Thursday and/or Sunday are the best days of the week to advertise. In fact, if you asked ten different media planners/buyers, they would also likely tell you the same. However, as is often the case with conventional wisdom, the philosophy needs a little updating.

At Mediabids, we know the best day of the week is unique to each advertiser. The following charts are representative of each advertiser’s flow of calls each week. The numbers for each day are the percentage of weekly calls for the given day – meaning X% for the week were on Monday, X% were on Tuesday, X% were on Wednesday etc.

Geeks

 

For ”computer repair,” the beginning and end of week are best.

 

 

 

AT&T

For a cable TV advertiser, the middle of the week is better.

 

 

 

 

A Place for Mom

A product for the ”senior market” does best on Mondays and Thursdays.

 

 

 

Omaha

 

On the other hand, a top consumer goods product has a call volume curve that is best Wednesday thru Friday.

 

 

 

When you think about it, it really shouldn’t come as a surprise that each advertiser has a unique signature (at least as far as print advertising is concerned.) After all, each advertiser serves different needs and has slightly different target markets. It stands to reason these variables would result in somewhat different call volume and response trends.

No matter which side of the media negotiation you happen to be on, the next time you get an earful of accepted wisdom (either from a media salesperson or from agency staff), you might want to remember we all have good days and bad days.

 

Post by Jim Jinks

Newspaper Readers Don’t Use Mobile Phones

Did I get your attention?

Conventional wisdom, at least from not long ago, would say that older Americans are not that ”digital.” In 2014, Pew Research showed that people 65+ were still about 18% less likely to use a mobile phone and they’re only about half as likely to go online and/or have broadband access. In other words, people 65+ are kind of like the ”settlers” in the latest (and very funny) series of DIRECTV commercials.

For sure, older Americans are still doing some things at a higher rate than the generations coming up behind them; like watching TV (when the show airs rather than time shifting), using the landline to make calls, ”going online” using their desktop PC and reading newspapers (the kind that will occasionally leave black ink on your fingers.) However, if our first-quarter call data is any indication, the conventional wisdom about older Americans and newspaper readers may be quickly becoming more conventional than wisdom.

Mobile vs Landline Chart

Our chart shows the percentage difference between the number of mobile calls versus landline calls; meaning in Texas, for example, there were over 300% more mobile calls than landline calls during the first three months of this year. New York State, at the other end of this scale, had a small difference between the number of mobile and landline calls. Of course, without weighing the types of publications and the specific advertisers that drove the calls, we’re not suggesting anyone jump to conclusions. Although, the advertiser mix is likely similar across these states. Also, for this comparison we only looked at the ten highest population states. The total sample, for all ten states, is tens of thousands of qualified calls.

The point is that with so much change in media devices and technology and so much change in our habits over the past several years, it’s likely we don’t know as much about ”seniors,” ”millennials,” ”adults 25-54” or any demographic set for that matter. If newspaper and print readers are reaching for their mobile phones first (often at a much higher rate than landlines) then it’s time to update the popular view of newspaper/print readers…if it’s possible.

Post by Jim Jinks

 

 

 

For the Love of Print

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If the smell of newsprint conjures up images of enjoying your morning coffee, reading the Sunday paper in bed, chances are you can appreciate good journalism and have a love of print.

Maybe today you get your favorite newspaper delivered electronically and you browse the digital edition.  But the “lean back” activity of reading an offline edition is uniquely relaxing and singularly engaging.  Your attention is less easily diverted than when you’re consuming content from a screen, easily able to navigate away from the page to your email or another app on your smartphone or tablet.  Maybe this helps to explain the high conversion rate of print ads.

There is something nostalgically satisfying about reading the print edition.  The tactile experience of holding it in your hands.

These days I think subscribing to the print edition of a newspaper or magazine demonstrates a commitment to that publication and the work is produces.  Maybe you can read much of the content online, but you enjoy the publication so much that you are signaling support for their journalism by being a paid subscriber.  With such a rich media landscape, there are so many (free) sources of compelling content.  Paying is a very conscious choice.  Print publications depend on their readership, as it influences their value to advertisers.  And most publications are still predominantly supported by advertiser revenue.

Personally, I have the magazine Real Simple delivered to my home monthly – despite the fact that anyone can see much of their content online and through their social media feeds.  I feel a sense of loyalty to the magazine as a subscriber (even when reading it takes me months to get to). I always hit my monthly limit of online articles on Harvard Business Review and the New York Times, though I’ve yet to pony up for paid access beyond that.  Also online I’ll skim The Atlantic, Wired, Fortune, Forbes, Entrepreneur, and Fast Company, as well as many others.

My father-in-law has the Wall Street Journal delivered and reads it cover to cover, in addition to their local newspaper.  I think this consumer behavior is relatively common across a certain demographic.  I know this pattern has generational influences, but it is not all explained by age.  Research suggests that print is seeing a resurgence of popularity among millennials today.

The transformation of the industry has certainly not been as drastic or sudden as some predicted, though it has not been without casualties.  What shuttered publications do you miss?

Some publications that have gone out of business have been brought back.  Domino, an interior design magazine, went out of business in 2009 only to be brought back by its “devoted cult following” in 2013.  With a rich print subscriber base magnified by a strong website and enriched by email and social media, they boast “one billion media impressions” since their 2013 relaunch according to their media kit.

How about you?  Which newspapers and magazines do you subscribe to?  Were your favorites among the hottest in 2015?  What content could you not live without?  Though you may not miss the smudged ink on your fingertips, doesn’t leisurely leafing through the paper at the kitchen table sound appealing?  Does modern life make that so unimaginable – to unplug and focus on one thing?  With a cup of coffee.

Post by Darcy Mauke

Happy Made-Up Holiday Day!

lexington-180975_1280Many of you outside the northeast may be unaware but today in Massachusetts (and Maine), public workers and school kids have the day off to celebrate Patriot’s Day -the two-state holiday commemorating the battles of Lexington and Concord; the events that kicked off the American Revolution in April, 1775. It’s also the day that the rest of us in New England, bitter and disgruntled, feel cheated for not having a ”made-up holiday” like Patriot’s Day. So in honor of the day and in the spirit of made-up holidays (sorry to my Massachusetts (and Maine) friends), I thought why not take a break from blogging about media and the print industry. Instead, today, we’ll look at other made-up holidays (a.k.a. important state traditions) from around the country.

March

Alaska -Seward’s Day (March 28th, thereabouts) – The United States purchased  Alaska from Russia in 1867. Seward’s Day celebrates Secretary of State William Seward’s signing of the treaty that made Alaska officially a part of the U.S.

Texas -Texas Independence Day (March 2nd)- In case you didn’t know Texas was once an independent country, Texas celebrates a holiday to remind you. The kids don’t get the day off from school but some state workers do have the day off. The Texas Independence Day commemorates the adoption of the Texas Declaration of Independence.

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April

Texas -San Jacinto Day (April 21st)-As they say, everything is big in Texas. This goes for state holidays as well. In addition to celebrating their declaration of independence, they also celebrate the day they won the battle of San Jacinto; the victory that won Texas’ independence from Mexico. San Jacinto is an official state holiday, meaning all public workers and school kids have the day off.

 

June

Hawaii -King Kamehameha Day (June 11th)- King Kamehameha Day is an official state holiday in Hawaii. It’s a day that Hawaiians celebrate their rich heritage and history. It’s the only official holiday in America that celebrates the life and contributions of a royal figure.

July

Utah – Pioneer Day (July 24th)- Pioneer Day is an official state holiday in Utah, commemorating the arrival of Brigham Young and the Mormon Pioneers in the Salt Lake Valley. They made the treacherous winter journey from Illinois to Utah, in 1847, to escape religious persecution and start anew.

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October

Nevada -Nevada Day (October 31st)- Apparently October 31st is extra special in Nevada. Along with Halloween, it’s ”Nevada Day,” an official state holiday. It commemorates October 31st, 1864, the day Nevada was admitted to statehood. Apparently Nevada has by far the largest statewide celebration of its admission to statehood. As far as ”made-up” holidays go, Nevada has as good as a reason to take a day as anyone.

There you have it. Our unofficial list of all the odd-ball state holidays from around the country. I know I skipped a few in Texas, but c’mon, how many does one state really need anyway? If I missed one, please mention it in the comments below. Thanks.

Post by Jim Jinks

 

Limit Your Opportunity Costs & Raise Your Short-Term ROI

Money TreesEven if money did grow on trees, we would still be faced with decisions in business (and life) that cost us revenue or income, all the time. Really, the only question is to what degree or how much.

In economics this is referred to as ”opportunity costs.” It is the ”loss of potential gain from other alternatives when one alternative is chosen.” In other words, when we make a choice, we lose the value (however defined) of having made other choices.

Business owners and managers are faced with opportunity costs nearly every day. This is perhaps most acute in terms of hiring new employees – especially salespeople. The churn rate in sales averages about 28% a year, meaning if you hire four salespeople this year you are nearly certain to end the year with only three. As we all know, the time and costs associated with hiring salespeople are high. A quick Google search turns up a range of $120k to over $1 million per year, depending on the industry. These costs include salary, benefits, training and lost productivity (meaning new sales!) What seems to go unnoticed or under-appreciated, is the fact that the costs of generating sales -in the short-term- is likely to exceed the revenue from new sales, meaning your short-term ROI is negative or neutral at best. It’s a major challenge.

Media properties and publications face these same costs and challenges. Increasingly, print publications have turned to ”off the page” or alternative revenue sources; these include events, sponsorships, buying clubs, in-house marketing businesses, etc. Nevertheless, there is one alternative source that doesn’t require an upfront investment of time and resources, the opportunity costs are low and the short-run ROI may well compete with the hiring of a new sales rep.

At Mediabids, our alternative revenue, print advertising service has an upside potential (like other alternatives) but without the high opportunity and hard costs of other options. You simply select the ads and tell us the size/specs. You run the ads in your pages. We then pay you for the response. It’s that simple!

sales chartWe have several publications (particularly the ones that view our service as a true alternative revenue source) that generate over $100k a year. Keep in mind, this revenue is virtually cost free and relative to the costs of other alt revenue options (or the option of hiring a new salesperson), the short-run ROI is tough to beat.

Even if money is growing on trees, at your organization, the opportunity costs of alternatives to Mediabids’ alternative revenue, print advertising, are likely to be unnecessarily high. If you’re considering the pros and cons of your options in the alt revenue space, be sure to include short-run ROI among the variables to be evaluated.

Post by Jim Jinks.

 

 

 

 

 

 

Does Your Paper Reflect the Spending Habits of the American Consumer?

ConsumersIn the U.S., nearly 70% of our Gross Domestic Product (GDP) is based on consumption. In fact, Americans spend a little over $11.2 trillion on goods and services.

The breakdown is about 65% on ”services,” such as housing, health care, travel, education, entertainment and personal care. The remaining 35% is spent on ”goods.” Economists tend to split the goods category into two types: 22% of spending on goods is non-durables (every day items such as clothing, groceries, fuel and household items); the other 13% of spending on goods is toward larger and less frequent purchases like cars, trucks, tractors, furniture and appliances.

Of course -depending on age, life-stage, income and a host of other factors- each of us may have somewhat different ratios of services to goods. Nevertheless, the ”average American consumer” spends about 65% on services and 35% on non-durable and durable goods each year.

The question you might want to be asking is -how well do the ads in your pages reflect what Americans are buying?

Over the past month, the Print Observer has profiled four local dailies (one in Vermont, Indiana, Washington State and Texas.) For each paper, we tabulated and analyzed the ad space in a recent Sunday edition. The analytics included: the number of ads overall and in each ad category; the total ad inches, total inches for each ad category and the average size of the ads in each category relative to the average size of all the ads in the section.

Pie chart

Looking back at the data, it’s interesting to note how well the advertising categories represented in the papers compare to consumer spending habits. Across the four dailies we reviewed, the average number of ads in the services category was 48%, the average in the non-durables category was 30% and the average in the durables category was 28%.

  • The services category (housing, health care, restaurants etc.) had a range of 68% to a low of 28%.
  • In non-durables (groceries, clothes, household items etc.) the high was 49% and the low was 4%.
  • In the durables category (autos, furniture, appliances etc.) the high was 28% and two papers had no advertising at all for durables.
  • Two papers also had a large number of house ads and/or political.

We only looked at four Sunday papers so this small sample is not necessarily indicative of the trends in newspapers across the country. However, the four papers were all mid-size dailies in small cities that are not unlike most other small cities in America so the averages across the basic categories are likely to be proximate.

Ultimately, considering where your readers spend the bulk of their dollars (65% services/35% goods) is as good a guide as any for targeting the kinds of advertisers that are likely to do well in your pages. If you’re at 60% or better for services and 30%-40% for goods, you at least know your publication is aligned well with general consumer spending habits and you’re at about the level of advertising, in each category, readers can tolerate.

Post by Jim Jinks