For years, FedEx Corp. bought ad space in most of the mainstream newsweeklies to capitalize on the tremendous reach they provided. But in the past 18 months, as the newsweeklies have faced growing competition for readers, the shipping company has altered its ad spend.
Rather than run an ad here and there, FedEx has opted to purchase space in a number of specific demographic editions that the newsweeklies offer to marketers, said Steve Pacheco, director of advertising for FedEx. These vehicles include the SmallBiz quarterly insert in BusinessWeek, as well as sponsorship of a U.S. News & Word Report radio program on finance and business that's carried by Westwood One Radio Network.
Although FedEx is being more selective in its ad buys with the newsweeklies, Pacheco said, "They're still an excellent media environment to engage and inform both current and future customers. As long as they're able to customize programs, we're likely to ride along to help people get information about our business."
FedEx's more discriminating ad buys come at a critical period for the major newsweeklies. Although they still own massive circulations, overall they are contending with declining ad pages and revenues. To stem the bleeding, they are taking dramatic steps, both in print and online, to maintain the strength of their brands.
BusinessWeek last month shuttered its European and Asian print products, resulting in the loss of 60 jobs. Instead of the print editions, the magazine, owned by McGraw-Hill Cos., will develop customized online editions for Europe and Asia. These editions, slated to debut later this year, will include vertical content areas, such as business education, design and innovation, and small business.
Kim Quinn, a spokeswoman for BusinessWeek, said the number of international visitors to BusinessWeek Online has nearly doubled in the past year and now represents about 25% of the visitors to the site.
Time Inc. is also placing significant bets online. This month, it launched CNNMoney.com, an umbrella for several Time Inc. titles, including Fortune, Fortune Small Business and Business 2.0, as well as Money and content from corporate sibling CNN.
`Time' for integration
Ed McCarrick, president-worldwide publisher of Time Inc., said he's mulling potential integration efforts between Time and CNNMoney.com. The company also offers targeted special sections, including "Global Business" and "Inside Business," which appear monthly in Time.
"We can give advertisers a huge level of professional and managerial numbers and, through targeted editions, can give marketers a laserlike approach to reaching CMOs and CFOs," McCarrick said, adding that b-to-b accounts for about 20% of Time's advertising revenue.
Time's archrival, Newsweek, has also developed several special sections in recent years. These efforts include a cover story series on leadership that runs in the spring and fall; two cover packages on "The Next Frontiers," which focus on technology; and four cover stories a year on health care.
"We're giving more opportunities to buy monthly themes in ads or sponsorships," said Greg Osterberg, worldwide publisher of Newsweek. "News magazines every decade need to reinvent themselves. Providing additional editorial at no extra cost to consumers is a step forward in that direction, knowing we have a high concentration of b-to-b readers."
About 50% of Newsweek's total ad base is b-to-b, Osterberg said.
U.S. News & World Report offers several annual special sections, such as its "Retirement Guide," "America's Best Health Plans," "America's Best Leaders" and "Technology Guide," as well as several "Executive" editions throughout the year. The publication has recently enhanced its online coverage of health care and small business.
"Readers come to us because they want serious information they can apply to their lives immediately," said Bill Holiber, president of U.S. News & World Report. "It's taken us a couple of years to get to that point, and the audience is beginning to see the value."
Edit leads the way
Most issues of The Economist feature a special report on topics such as technology or oil. "We don't want product around advertisers but editorial-led components that are important to readers in which we then try to monetize, not the other way around," said Paul Rossi, publisher of the magazine's U.S. edition.
Despite the proliferation of special sections offered by the major newsweeklies, the bulk of b-to-b advertisers still view such vehicles as much too broad, said Jack Hanrahan, U.S. director-print communications for OMD, a division of Omnicom.
"Some [b-to-b advertisers] go to the newsweeklies because they are willing to tolerate the waste," Hanrahan said. "B-to-b has a lot of relevance to the man on the street [but] b-to-b marketers can find better ways to reach their prospects in more targeted media. The newsweeklies need to find the right messages to put in front of decision-makers and show their value that, in some cases, is being overlooked."