BtoB Media Business - June 2009 - (Page 14)

SALES & MARKETING Sales & Marketing Custom takes center stage As marketers spend less on traditional marketing, custom media grows as channel BY MATTHEW SCHWARTZ AD VANTAGES Bigger investments, but in fewer venues avid Hunke, who in April was named president and publisher of USA Today, takes charge at a difficult time for the spectrum-colored daily, the largest newspaper in the U.S. Ad revenue was down 34% in the first quarter while circulation fell 7.5%, to 2.1 million, for the six months ended BIO March 31, according to the Audit Bu- DAVID HUNKE reau of CircPresident and ulations, with cutPublisher, backs in business USA Today travel partly to blame. MB: What marketing plans do you have to combat both declining circulation and erosion in ad budgets? Hunke: We’re exploring expansion of our electronic edition and potential rapid rollouts. We’re working very closely with our blue-chip and hotel accounts to expand circulation and distribution. We’re [also] interfacing with more customers and offering more propositions and proposals to sales problems. MB: How do you monetize content without alienating readers conditioned to accessing content for free? Hunke: There will always be free access to a significant portion of our breaking news content. We’re going to be looking for ways to build specialized communities, supplemented either behind or bundled with paid-subscription models. MB: What are some of the ways to better leverage the USA Today brand? Hunke: It’s just too premature to answer that, but you will see USA Today fine-tuning its marketing and brand development. We’ll be more involved with bigger investments in fewer venues and will not be as diversified —M.S. or as diluted. C ustom media has long been on the periphery of business publishing. But with marketers strapped for budgets these days—and eager to reach their audiences in a more personal vein—custom media has started to move toward center stage. “We’re increasing investment for turnkey solutions because of the limited resources among clients who are not able to create [custom products] by themselves,” said Josh Heitsenrether, senior VP-integrated marketing and client services at Ziff Davis Enterprise, which caters to technology companies. “You get higher execution and accountability by offering one package, which ties traditional products into custom media in a holistic, endto-end way.” By bundling custom products into marketing packages rather than isolating them in a separate bucket, business publishers can avoid the possibility of cannibalizing traditional ad dollars at the expense of custom media. “There’s been a decentralization of marketing dollars, and there’s more flexibility in how things are purchased,” Heitsenrether said, adding that custom publishing now represents roughly half of ZDE’s overall revenue. “There are additional purchasers, tangential to media buyers, who have different goals. Lead gen is now tying into traditional marketing, and the custom component helps bridge the message for the purchasing process.” A recently released survey conducted by Roper Public Affairs and Media for the Custom Publishing Council illustrated the growing appeal of custom media. The telephone survey, which questioned 1,000 American adults from Feb. 18 to March 3, found that custom publications have a positive effect on purchasing behavior: 68% of respondents said the companies that provide information about their products in custom publications help them make better purchase decisions and 63% said they have bought something they saw mentioned or advertised in a custom publication. More than two-thirds of respondents said that companies that provide information about their products in custom magazines help them make better purchasing decisions—an increase of six points since Roper last conducted this survey in 2005. “The signs are clear that this a growth area,” said Michael Winkleman, president of the CPC and of Leverage Media, a custom media company with clients such as Convergys and Patton Boggs. “Marketers are increasing spending on custom not necessarily by adding dollars but by carving budgets up in a different way.” Custom media can take many forms, such as a print magazine, Web site, microsite, white paper, e-newsletter, webcast or podcast. To be sure, custom media remains a relatively small part of business publishers’ portfolios. In 2008, custom media accounted for 2.2% of the combined overall revenue of 20 b-to-b companies that took part in the “2009 American Business Media Financial Survey.” In the last three years, custom media has declined at a compounded annual growth rate of 1.1%, but its contribution (revenue less expenses) has grown at a CAGR of 3.7%, according to the report, which was prepared by media investment bank Jordan, Edmiston Group. Although stemming from a small base, custom media has tripled in the last three years at technology publisher IDG, said Matt Avery, senior VP of IDG Enterprise Custom Group. “The space has grown up demonstrably in the last few years,” he said. “Old-school publishers and journalists used to look at custom as a dreaded advertorial. But now there are so many assets available that brands are looking to custom to leverage their relationship with their reader base.” Junta42, an online marketplace for custom publishing and branded content, has 15,000 unique monthly users, up from 10,000 in December, said Joe Pulizzi, founder of Junta42 and a CPC board member. “There’s a fight for this type of [custom] content both online and offline,” Pulizzi said. “If business publishers don’t do it, somebody else will.” D 14 | Media Business | June 2009 | mediabusinessonline.com http://www.mediabusinessonline.com

Table of Contents for the Digital Edition of BtoB Media Business - June 2009

BtoB Media Business - June 2009
Contens
Publishers Reassess Google AdSense Programs
Amid Cutbacks, Media Firms Are Still Investing
Open-source CMS Advantages Outweigh Problems
Sales & Marketing
M&A
Online
Production
Events
Circulation
People
Benchmarks
The End of B-to-B Media As We Know It?

BtoB Media Business - June 2009