$43.6B U.S. agency revenue
Although its print spending now dwarfs its online outlay, Sun doesn't downplay the power of print. "The people who write the checks are not online as much and are still big print readers," said Susan Space, director of branding and advertising at Sun. "The C-suite has less experience online, and you're not going to reach everybody online. So print provides you with some air cover."
Sun is now running print ads in CIO, eWeek, Forbes and The Wall Street Journal. It also has a contract with BusinessWeek to run a strip ad each week adjacent to the cover story.
Sun's approach reflects the ever-changing media environment, where print spending is now just part of the media mix. Yet print has hardly been relegated to the sidelines. It is often the driver for the integrated advertising campaigns that are fast becoming the norm in marketing communications. The overriding question for business publishers is how they will balance print losses with online gains, all the while keeping up with clients' shifting demands.
Steve Weitzner, president-CEO of CMP Technology, said that ad budgeting "doesn't break neatly into print versus online versus events. It's about how you integrate all of the elements to get a certain result."
Despite countless articles about the decline of print, b-to-b marketers still view the medium as a critical component in media buying.
"It's not a matter of print becoming less important and other media becoming more important," said Philip Juliano, VP-global brand management and corporate communications at Novell Corp., which in 2005 shifted its print-online media spending ratio to 50-50 from 80-20. For its "Software for the Open Enterprise" campaign, Novell is running ads in several IDG Communications titles, including CIO, Computerworld and Network World.
"Not unlike other traditional media, there isn't an inexorable decline in print," Juliano said. "Just because we dialed back our print spending doesn't mean you can draw the conclusion that it's eventually going down to zero. … Advertisers need to be on the leading edge of new technologies, but that doesn't mean you throw out the old tools."
Print remains engaging
Jeffrey Hayzlett, CMO of Kodak's Graphic Communications Group, which serves b-to-b markets, also remains bullish on print. "Print is still the best way to reach out and touch customers," he said. "Consumers are numb to media and don't wish to receive unsolicited messaging. Print remains a medium that people actively engage with." Kodak's b-to-b group runs brand awareness and demand generation advertising campaigns in dozens of trade titles, including Book Business, Digital Output and Package Design.
Hayzlett pointed to studies showing that U.S. CMOs still spend 50% of their ad budgets in print. "Personalized print advertising yields high response rates and ROI," he said.
Chris Philip, senior VP-media director of b-to-b ad agency Doremus, said that before b-to-b marketers settle on how they are going to distribute their ad dollars they should be clear on the overall concept of the planned campaign. "It shouldn't be from an advertising standpoint but as a buyer—who am I trying to reach and who am I trying to communicate with?" he said
Marketers spent about $10.80 billion on advertisements in b-to-b publications in 2005, up 0.61% from the previous year, according to the Business Information Network, a unit of American Business Media. Ad pages finished the year up 0.68%. ABM projects print ad pages will grow 1% to 2% this year and that revenue will increase 2% to 4%.
Event revenue is expected to grow 6% to 8% this year. Gordon Hughes II, president-CEO of ABM, has stated that face-to-face revenue will be "at parity" with print this year. Last year, events generated about $10.40 billion in revenue for publishers.
Digital revenues are expected to grow 22% to 25% this year, according to ABM. Custom media, which includes many print products, is expected to grow 18% to 20%.
B-to-b marketers' media spending mix depends heavily on the marketplace that is being targeted.
At ALM, which caters to legal, real estate and financial professionals, print spending is holding steady, according to Senior VP Jack Berkowitz. "In some areas print is doing well and other areas exceedingly well and growing," he said, pointing to the growth in print advertising among b-to-b companies and law firms.
Berkowitz stressed that there are no hard-and-fast rules for how ALM's clients distribute their media budgets. "Some advertisers have moved strictly online, and I haven't had anybody move strictly to print," he said. "But we have some brand-new advertisers only advertising in print and other advertisers who started online and are now buying print."
"It's all about how you deliver the information. If you can't present clients with multimedia offerings you're dead in the water," he added.
For technology-related publishers it's an entirely different story. "Print is flat on a good day," said Bob Carrigan, president of tech publishing giant IDG, whose online revenue now accounts for about a third of the company's overall revenue.
Carrigan is a firm believer in media agnosticism. "Our goal is to manage the client's objectives and use all of the levers at our disposal to either dial up or dial down the particular marketing channels based on what the requirements of the campaign are," he said.
Abe Peck, chairman of Journalism & Cross-Media Storytelling at Northwestern University's Medill School of Journalism, said that the needs of the audience, rather than publishers' print capabilities, are what counts.
"Nobody wants to run away from likeable formats that generate revenue now," Peck said. "But the future is in building trust and loyalty by providing information when, where and how it most benefits audiences. Otherwise they will go elsewhere, and marketers will follow. This will require expense and broadened skill sets. It's also a tremendous opportunity."