"Media broadcast prices have gone up more than advertisers' budgets anticipated, and as a result money was siphoned off from other media and to a large extent from print. This was in order to pay for the rate increases the broadcast networks were able to get," said Mike Drexler, CEO of Publicis Groupe's Optimedia USA.
Several media buyers said they would ratchet up pressure on magazine ad prices to push for deeper discounts. "It's a good time to be a magazine buyer," said Charles Rutman, president of Aegis Group's Carat USA.
The weak economy persuaded many advertisers to fall back on traditional, broad-based media options to maximize reach.
In that environment, media-neutral planning and the practice of spreading brand messages across a range of targeted media venues take a back seat-at least temporarily.
Buyers expect other broad-based media forms such as outdoor and radio to see an uptick before magazines, which increasingly serve niche readerships. "Their strong suit lies in their narrowness, but that narrows your sources of ad revenue. And when you get to the biggest circulation magazines with the biggest rates, you lose that definition and effectiveness," Mr. Rutman said.
Newspapers continue to struggle with readership declines, particularly among young people. And their crucial classified ad bases are moving to the Web.
Bruce Goerlich, senior VP-media research for Bcom3 Group's MediaVest Worldwide, New York, noted the current disparity between consumer and business marketing in general. Consumer marketing, he said, is on the rise, which benefits consumer media such as TV, radio, and outdoor. But business-to-business marketing is in a decline in response to negative economic and stock market news, causing ad volume declines at many trade publications, business magazines and newspapers.
"Businesses are just not confident enough to advertise to other businesses," agreed Jon Mandel, co-managing director of Grey Global Group's MediaCom.
The bullish network prime-time upfront garnered approximately $8.1 billion in deals consummated between advertisers and networks. "The good news is that broadcast deals are holding strong," said Marc Goldstein, president-CEO of WPP Group's MindShare North America.
The magazine advertising market, however, is a bear, with ad page counts down overall 8.5% from last year, according to Publishers Information Bureau figures for January through July.
Ray Simko, president of strategic planning, MindShare, said that roughly 80% of the drop in magazine ad pages could be attributed to the overall economy. But the inflexibility of magazine ad buying-which requires advertisers to commit often up to two months in advance-also played a part. "You can't get in and out of it as easily as broadcast."
Many media buyers believe magazine publishers will have to rethink their selling model if they are going to flourish. "The discounts will have to be deeper," Mr. Drexler said. "It's going to be a completely negotiated game."
In some cases, buyers have already seen flexibility. "How do you think they got their September books so fat?" Mr. Mandel said. "They got more realistic on pricing. Notice how they all said print was back, `Look at the paging.' No one said, `Look at the revenue.' "
"The real comparison will be" in 2003, Mr. Simko said. "What happens to print next year versus what just occurred in the recently concluded broadcast upfront. ... Better times are coming for" magazines.
contributing: wayne friedman