Levy, Clift Warn Mag Execs to Innovate Before It's Too Late

At FIPP Gathering, the Publicis Chief and Unilever CMO Urge Industry to 'Shatter Traditional Standpoints'

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LONDON (AdAge.com)--Unilever Chief Marketing Officer Simon Clift and Publicis Groupe CEO Maurice Levy gave a stark warning to an international gathering of magazine publishing executives today, urging the industry to innovate and to be more creative.

Maurice Levy
Maurice Levy Credit: Julio Piatti
The addresses to the FIPP World Magazine Congress come as the magazine business endures the most calamitous period in its history, thanks to the breakdown of print advertising and publishing companies' struggles in grabbing a piece of the growing digital pie.

Mr. Levy, who predicted that the audience would hate him by the end of his presentation, told them that magazines must "shatter traditional standpoints" if they are to escape the current cycle of "despair, doom and demise."

Mr. Levy stressed that the magazine industry's problems are purely due to business cycles. He predicted that growth would eventually come back to the industry. "Don't expect the economic crisis to be the end of the crisis for analogue media. This is a profound structural revolution; don't be like the auto industry that waited too long."

Publicis Groupe's Zenith Optimedia predicted that magazine market share will keep shrinking through 2011 even though the world economy is expected to be back to growth by then.

No going back to print
"Who can believe that digital natives will ditch their computers and phones to get back to print?" Mr. Levy asked. "Advertisers are not expected to go back to print after discarding the media. The current crisis is not the cause of the problems of the media industry, it's just a cruel accelerator of long-term trends. The shift of advertising dollars to digital media will gain speed and market share whatever the economic situation might be."

He added, "We live in a world where two words on a search engine's results page are considered more effective than a TV spot. We have to change and we do every day."

Despite the rush to digital, however, Mr. Levy said that the internet has not delivered on all its promises. Search still takes in nearly half the money, display is disappointing and it's difficult to make internet users pay for content. "But all these things are not necessarily true forever. The crisis is useful for shaking the rules."

Through its partnership with Google, Mr. Levy said that Publicis is working on a project to rebalance the display market and find a new standard of video advertising on the web that will transform online display advertising. "You've not seen yet anything," he said.

Simon Clift
Simon Clift Credit: Jason Alden
Thinking outside the box
Mr. Levy goaded the audience by saying that other industries have managed to think differently -- including the rather debatable claim that the music industry has worked out how to charge online -- and asked, "Why can't you think of something similar for your magazines? You need to think out of the box. Don't wait for a new business model to come out of the sky. There will be no new business model, no Holy Grail, no one-size-fits-all solution for the print industry. Each title or media needs to find its own way."

Mr Levy added: "Don't waste the crisis. Use the time to start thinking. As an adman, I'm always surprised how little you take advantage of your great brands. You have built communities long before the internet started. Why don't you leverage this much better? The optimist and the pessimist are born the same and die the same -- the difference is that they live differently. I urge you to live differently. Everything is possible."

In the following session, titled "What advertisers want," Unilever's Mr. Clift echoed Mr. Levy's call for innovation in the magazine industry. He said, "You have fantastic brands, [but] have you thought deeply about which adjacent relevant categories you could move into?"

Mr. Clift cited the example of a magazine that Unilever produced in Argentina for the Sedal hair brand that achieved a third of the circulation of Cosmopolitan "without much effort." He added another unpalatable truth when he admitted, "I spend ten or twenty times more time thinking about digital as about magazines."

Losing their competitive edge
Nikolas Talonpoika, worldwide media director of the Gucci Group, raised a round of applause when he said that 90% of his spending still goes to magazines. But he added, "Digital needs more investigation from our side, from the metric and creative points of view." He also said that out of home has an improved offering and is a significant media in emerging markets.

In the past, Mr. Clift said, magazines' competitive edge was their flexibility. But now "even the biggest TV stations come to us to ask how they can integrate our brand properties in the best way. Before the upfronts in the U.S. we show the big TV stations what we are trying to do with our brands so that they can come up with ideas on how they can work better with out brands. The competition has upped the game."

For Mr. Clift, the selling point of magazines is the opportunity for "symbiotic editorial." "If the [marketer] information is useful, relevant and interesting there's no reason why it should be inconsistent with the magazine brand. It can build the magazine's brand equity rather than compromising it," he said.

He added, "We are coming close to a point where we can't make ads any longer that consumers won't actively engage with."

FIPP, or the International Federation of the Periodical Press, will continue its congress through tomorrow in London.

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