Magazines' Pitch to Marketers: Our Ads Will Work -- We Promise

Time Inc. Works With Starcom MediaVest to Guarantee Performance Results, or Run Make-Good Advertising

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NEW YORK (AdAge.com) -- Magazines have always promised their advertisers a certain number of paying readers. Now the industry is moving toward another guarantee: that its ads will work.

One of the industry's biggest publishers, Time Inc., and one of its biggest ad buyers, the Starcom MediaVest Group, are collaborating to develop promises that certain numbers of people will remember ads or take action on them. If a participating marketer's campaign doesn't achieve the promised result, Time Inc. will run free additional ads until it does.

The effort, dubbed the Alliance for Magazine Accountability, will start with select Starcom MediaVest clients. The companies declined to identify those clients, some of whom they said are still being chosen, but Starcom MediaVest 's client list includes heavy hitters such as General Motors, Allstate, Walmart and Coca-Cola.

The Alliance will study audience and performance data from outside providers, Affinity's Vista service and Mediamark Research and Intelligence's AdMeasure service, covering the first half of this year, then start making guarantees covering the second half of the year.

"We've been preaching that magazines engage readers like no other media," said Stephanie George, exec VP at Time Inc., which publishes magazines including Time, People, Sports Illustrated and Fortune. "So today, in a crowded media market, when it comes to accountability, the work from this Alliance will help prove magazines' advertising effectiveness."

NBC's moves
The recession, new research tools and increased spending on more easily tracked digital channels have pressured all media to better prove their worth to advertisers -- and that's slowly making performance guarantees more common. In TV, for example, NBC has been guaranteeing audience engagement to some clients in particular deals for several years.

Circulation will continue to be important because it's a valuable metric and benchmark for all marketers, said John Muszynski, chief investment officer at SMGX, a Starcom MediaVest unit where the group's agencies exchange intelligence, test new models and share resources. "However," he said, "as all the other media out there start to bring out more sophisticated, more precise targeting data and accountability metrics, the magazine industry needs to keep up."

The other major magazine publishers, including Conde Nast, Hearst, Bonnier, Meredith and Rodale, only guarantee paid circulation. But since the beginning of the year, two magazines, Scholastic Parent & Child and The Week, have also been guaranteeing performance for marketers making big enough ad buys. Both titles use Affinity's Vista service, which surveys readers on measures such as ad recall and actions they took after seeing ads.

Scholastic guarantees qualifying advertisers, such as Walmart, Panasonic, Discover and Trident, that their ads will generate enough reader action to rank in the top third among the women's magazines that they are using. If an ad campaign's results fall short, Scholastic Parent & Child will issue a 10% refund.

The Week guarantees each qualifying advertiser that its ads will get reader recall scores that rank in the top third of all the magazines in the marketer's media plan. If they don't, The Week will run more ads until the guarantee is met.

Time Inc.'s pledge
The pledge that Time Inc. and Starcom MediaVest are developing is different because it deals with the number of people who recall an ad campaign or take action in response to it, not performance in relation to another title or mix of titles.

The Week's guarantee makes advertisers happy, helps sell ad pages and shores up ad prices, according to Steven Kotok, president at The Week. "We only do it for 12 pages of advertising or more, so a lot of advertisers are running extra paid pages to reach that threshold to get the guarantee," he said. He wouldn't disclose the eight marketers participating.

"In an era when a lot of advertisers ask for rollbacks across the board, the guarantee is what lets us keep rates steady or ask for an increase," Mr. Kotok said. "'We'd love to give you last year's rates,' we say, 'but then we can't give you the guarantee. If you take a nominal increase, we can give you the guarantee.'"

The push toward performance guarantees from a major publisher such as Time Inc. suggests such promises could become much more common for magazines -- especially if it proves to help ad sales.

But how these guarantees are executed will determine how much they benefit magazines and advertisers, said Scott Kruse, managing director and director of print at Group M, another major ad buyer. "In theory, this sounds like a positive, but there are going to be a lot of questions around methodology and the nature of the guarantees," he said. "It's one thing to do it on a smaller title like Scholastic or The Week, but when you do it across a major publisher, it could become a lot more complex in terms of how you manage that, how the methodology is based and the methodology for the make-goods if the guarantees aren't met."

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