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Hearst Goes High Tech for Back-Office Functions

Publisher Lets Advertisers Deliver Creative via Web Portal, Improves Subscriber Serves Online

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NEW YORK (AdAge.com) -- Hearst Magazines is introducing a series of changes to the way it works with advertisers and subscribers that are meant to finally press technology for the benefit of print.

Cosmopolitan's lead time went from 48 days down to 28 days.
Cosmopolitan's lead time went from 48 days down to 28 days.
Hearst has fired up an online portal, for example, through which it is forcing advertisers and agencies to submit all their ads, forgoing physical delivery. That in turn has simplified a Hearst effort since last fall to customize ads for each title when advertisers buy across them.

Tear sheets, the pages publishers use to show marketers that their ads ran as planned, are going electronic this summer. Billing is finally getting standardized across magazines for the first time, according to Hearst. Lead times, the problematically early deadlines magazines require for ads to get included in a particular issue, are getting chopped. For example, Cosmopolitan's lead time went from 48 days down to 28 days, and the plan is to cut it even further in the future.

It's built a web-based tool meant to make it easier for Hearst to service subscribers through the internet. Hearst now charges credit cards immediately instead of overnight, letting consumers correct mistakes entering their card numbers on the spot rather than getting an e-mail later -- and often not going back to fix the problem. Hearst now immediately gathers information on new customers and cross-checks it to see if they subscribe to any other titles, how much they've paid for subscriptions in the past, what their renewal rate is and so on. That kind of data helps Hearst sell consumers additional titles (without, for example, pitching one they already get.) And Hearst used to maintain a dozen different subscription offers on each magazine site; now it has 200 per title that are customized to consumers based on their data and history.

And in a separate but simultaneous bid to shore up magazines' future, one in which the physical object is a chief selling point, Hearst is testing a new larger format and higher cover price for Good Housekeeping.

"It's to make the magazine business more nimble, faster, more efficient in terms of buying and selling," said Michael Clinton, exec VP, CMO and publishing director at Hearst Magazines, of the effort.

The changes are welcome, even if they seem a little tardy, media buyers and agency executives said. "Automation is a huge idea," said Andrew Swinand, president-global operations at Starcom MediaVest Group. "If you think about the inefficiency in the industry it's almost comical. If you look at the lead times on print, it's insane. It's not even old school, it's like stone age."

Many years of success with the status quo made it hard for the industry to evolve, Mr. Swinand said. Why change when you're making a lot of money?

Michael Clinton
Michael Clinton
The arrival of digital media and then recession, however, has altered that equation for many publishers.

"The reality is this industry is so resistant to change," said Robin Steinberg, senior VP-director of print investment and activation at MediaVest Worldwide. "But I believe the recession has exacerbated the decline in dollars and changed the mindset and approach for this company -- and hopefully others. Recession equals transformation."

Mr. Clinton said Hearst began its program of improvements two years ago. The recession has made the work more urgent, he said, but the company hopes the shift will help it rebound quickly once the recession ends.

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