CHAPTER EIGHT
DIRECT PRINT
Getting More Than Ever for Your Ad Dollar
“Serious Lighting for Serious Readers.”
That’s the headline of a tiny print ad (which also featured a drawing of a desk lamp, an address, and a phone number to call for a free catalog) that launched a multimillion-dollar business.
“Space ads enabled us to get started. They helped my wife, Lori, and I launch our company 20 years ago,” says Steve Leveen, president of Levenger, the Delray Beach, Florida-based provider of high-end reading tools, diaries, notebooks, briefcases, and more. “At our peak, we were in 20 publications or so.”
These included The New Yorker, The New York Times, Smithsonian magazine, The Nation, and Law Journal (many attorneys are still loyal customers), among others. Levenger included address codes unique to the magazine in which the ad appeared. This allowed the company to track and quantify the response from each one.
Levenger doesn’t use print ads anymore, but Leveen believes it is still a very viable marketing channel, even in the Internet Age.
Collectible coins is one industry that still markets primarily through space ads. Look at any issue of USA Today or Parade and you will see ads from several different companies offering sets of presidential quarters or collector’s editions of newly minted coins.
BRANDING VERSUS SELLING
In this chapter, we are talking about direct-marketing print ads. They are quite different than many ads you’ve seen in publications for perfume or consumer electronics or cars. Those types of ads seek to create an “awareness” about the product. These “branding” ads are usually eye-catching, but the advertising company has no real way of knowing exactly how much business the ad brought them.
In direct-space ads, the entire ad is directed toward convincing the customer to take action immediately. There is a phone number or web site so that the prospect can order the product right then. And because those orders can be tied to a particular ad in a particular publication, the company knows exactly what ad provoked the strongest response . . . and which one didn’t. This testing, which allows the marketer to drop the losing ads and roll out the winner, is another key to direct response.
In fact, pick up an issue of any newspaper or magazine and you will see direct-print advertising at work. Everything from exotic travel to reading lamps to celebrity memorabilia to dolls to plants to time shares are routinely sold from little ads on the pages of all the most popular newspapers and magazines. Specialized periodicals—aficionado magazines and trade journals in particular—abound with direct-print advertising.
It makes sense. Direct-print advertising combines the best of two worlds: the wide reach of general advertising with the qualifying and monetizing characteristics of direct mail.
WHAT ARE YOU WAITING FOR?
If you are in the direct-mail or direct e-mail business already, it be-hooves you to develop a parallel channel of direct-print advertising. If you aren’t currently doing direct-mail sales, print advertising is a good place to start.
Direct-print advertising has many advantages. The cost involved in testing is modest, the likelihood of success is reasonable, and the financial returns can be great.
Developing a viable print advertising channel will benefit your business in two important ways. First, you will acquire customers you couldn’t get through other media. And second, you will give your brand or product widespread exposure that may one day convert to direct sales.
We have had lots of experience in direct-print advertising over the years, selling everything from jewelry to perfume to cosmetics to books to seminars and travel. We believe that there is almost nothing that can’t be sold through this channel. And that’s not surprising, considering the range of media—from local “penny savers” to nationals such as The Robb Report.
Despite the potential of direct-print advertising, most entrepreneurs are reluctant to try it. To them, as outsiders, it seems risky and expensive. But the truth is very different. Making direct-print advertising work is a pretty simple process.
Generally, magazine and newspaper publishers price their advertising space according to circulation, size, color, and location.
Circulation is the most important factor. A magazine that reaches 3 million people (such as Time or People) is going to charge much more for print space than one that reaches only 400,000 people (such as Bicycling or Computer Shopper) or 40,000 (such as a locally published periodical).
Size is the next most important factor. Bigger ads are more expensive than smaller ads. Ad sizes can range from multipage layouts to double-truck ads to full page to half page to quarter-, eighth-, and sixteenth-pages.
Then, color and position must be considered. Here, too, common sense rules. Color processing is more expensive than black and white. And better page positions carry premiums.
So how do you decide what kind of ad will work for you?
That depends on the product you want to sell. Some products work very well as small black and whites placed randomly on a space-available basis. Other products need the attention-grabbing capacity of a full-page, four-color ad, placed in a prominent position.
DIRECT-PRINT ADVERTISING IS DECLINING, BUT STILL VIABLE
According to the Newspaper Association of America, readership of newspapers has been falling since 1990. Only about 48 percent of American adults regularly read at least one newspaper during the week.* The decline in readership has resulted in a 20 percent drop in advertising dollars in only the past 10 years.† Magazine ad rates have remained about the same for the past 20 years or so.‡
From a direct-marketing perspective, this trend is not quite as bad as it seems. That’s because some of the drop-off is due to a migration of advertising dollars from print to the Internet. At one time, for example, the back of The New York Times was the only place that summer camps for obese children could effectively advertise. The New York Times still works for such advertising, but today there are dozens of Internet sites on camping that work just as well, or better. Thus, the advertising dollars spent to sell these summer camps may be the same, but the amount going into old-fashioned print is diminishing.
That shift notwithstanding, print advertising is still a large and viable market. According to the Newspaper Association of America, print advertising in newspapers alone brought in $46.6 billion in 2006.
SUCCESS IN DIRECT-PRINT ADVERTISING
As with all channels of advertising, your success (or lack thereof) is affected by several factors. In direct-print advertising, this includes:
Media: The most important factor is media—which particular publications you choose to advertise in. In this regard, direct-print advertising is like direct mail, where the list you mail to (rather than the offer you make or the copy you employ) has the greatest impact on response rates.
The difference between media selections can be enormous. One magazine might give you back four times the money you spent on it, while another might give you nothing back at all.
That’s why it is so important to test lots of different media. Most won’t work for you, but some will. To find one publication that’s profitable, you may have to test half a dozen that aren’t.
In direct mail, everybody understands this concept. But when it comes to direct-print advertising, most marketers have an entirely different point of view. They approach the market skeptically. And then reluctantly test one or two ads in one or two publications . . . and wait for the results.
If they get a good response, they move forward. If they don’t, they back away. “We can’t make print work,” they say with confidence. They believe they have given it the old college try, but they haven’t.
To develop a direct-print-sourced channel of customers for your business, you must commit to the process in a serious way. Serious means studying the market carefully to determine where similar products are being sold—and then committing to testing 10 to 20 different publications before you decide that direct print doesn’t work.
Most entrepreneurs who got their start using direct-print advertising will tell you stories about how they struck out time and time again before they discovered the media that worked for them.
We remember coaching a friend who wanted to start a physical therapy business for pelvic ailments. She tested a dozen of the bigger, more obvious local newspapers and magazines before she found one—a local Jewish newspaper—that proved enormously responsive. Based on that one source alone, she quadrupled her business in one year. That growth of cash flow allowed her to continue to look for other media that would work. She found only two more, but the three together were enough to grow her business to a point where word-of-mouth advertising was all she needed thereafter.
Cost: After media, the next most important success factor in direct-print advertising is cost. Yes, finding a publication that works is critical. But if the cost of that advertising is greater than the profit you derive from it, you won’t be happy in the long run.
Some marketers take a blanket approach to cost, refusing to pay more than a certain number of dollars per thousand readers. (“Dollars per thousand” is a standard industry measurement.) As a general rule, this is a mistake. Each publication that carries your ad is going to give you a different type of customer. Some will respond immediately, but die out quickly. Others will have a longer tail. Some will buy only very inexpensive products. Others will be responsive to higher margin promotions.
In building a profitable direct-print-based channel, you will eventually need to know the “lifetime value” of each of the publications that take your ads. As the term suggests, the lifetime value tells you what a customer is worth over his buying life with you. The lifetime value of your customers depends on how you treat them, as well as on the quality and cost of the products you sell them. But lifetime value is also influenced by where you get your customers.
Each source—each publication in which you advertise—will deliver a different lifetime value. For that reason, it’s necessary to track your customers according to source. By analyzing lifetime values this way, you will be able to determine just how much to spend on each print publication in which you advertise.
When you test a new source (i.e., a new magazine or newspaper), you won’t know its lifetime value for at least six months. While you are waiting, you can make decisions about continuing advertisements with that source by assuming that it will deliver an average lifetime value. If the initial response is stronger than average, you can go forward with a reasonable degree of confidence. If the response is average, you should continue, but very conservatively. If the response is below average, it’s usually better to wait till you can determine the lifetime value of those customers.
Generally, the quality of customers you get from any individual source will remain constant unless something changes with the source itself. Sometimes a change of editorial policy can improve or diminish its quality. Sometimes a change in circulation—particularly a sudden increase—will signal a change in quality, one way or the other.
For this reason, it’s important to pay close attention to editorial consistency, advertising practices, and response rates of sources during the testing phase. If they suddenly change, be alert. Consider curtailing or even stopping your advertising until you have reason to be optimistic again.
Offer: After media and cost, this is the most important factor in determining your success in print. The “offer” is a broad term—it consists of the product, the price you ask for it, and other variables such as premiums and guarantees. Finding the right offer takes some time and testing. When you are beginning and don’t know what offer to use, look around at what your competitors are doing. If they’ve been running offers for any length of time, it is usually because they are working. Imitate and “test against them” by changing individual aspects of the offer (price, premium, guarantee, etc.) and seeing how such changes affect response rate.
Offering products or premiums for free will usually generate the greatest response, regardless of the source you are using. But free offers also tend to bring in less qualified customers (i.e., customers with lower lifetime values), so be careful about entirely free offers. It’s usually better to incorporate some sort of price qualifier—even if that means as little as charging a small fee for postage and shipping.
Copy: The last factor that will affect the outcome of your print placements is the copy you use. Although this is the fourth most important factor, that doesn’t mean you should give it short shrift. The copy can double or halve response rates, even when the source and offer are the same. For that reason, you should test copy constantly, always looking to beat the current control.
If you have direct-marketing experience, all of these principles will be second nature to you. Direct-print advertising is, like direct mail, just another aspect of direct marketing.
BUYING PRINT
In purchasing space, give priority to source—that is, test the publications in which you have the most confidence. But never forget the importance of keeping your costs down. Negotiate the best rates you can at all times.
Sales reps for print space will do their best to talk you into spending as much as you can afford (or even more!). They will try to get the highest rates possible by arguing that you should buy full-page, four-color ads in prime locations. Only you can know what kind of space works best for you. Test when you can afford to. The object is to find space ads that work well without spending top dollar.
Sales reps will also try to convince you to buy multiple placements. Most will argue that your response rates will increase with each successive placement. As far as we know, there is no evidence that this is universally true. Our own experience has been mixed. Therefore, our recommendation is to begin with a single placement only, even though this will be—on a relative basis—more “expensive” than multiple ads.
These are the standards and principles of direct-print advertising. Now let’s take a look at how these operate in practice, along with some clever and useful techniques you can use to improve your results.
LEFTOVERS ARE GOOD!
Whenever possible, try to purchase remnant space. This is space in a magazine or newspaper that has not sold in time and is “left over.” It is also referred to as remainder advertising or last-minute advertising space.
Unlike the Internet, print advertising has very tight deadlines. These deadlines are necessary due to the time sensitivity of the medium.
That gives sales reps only a limited amount of time to sell ad space. If the sales reps do not sell their quota in time, the very same space will be offered at a steep discount, for two reasons: (1) The reps (and publishers) would rather collect a fraction of the space price compared with no revenue at all, and (2) if the space is not sold, it will be filled with house ads or public service announcements (PSAs). If this happens too often, it sends a message to the advertisers in that publication. It essentially tells them that the publisher could not sell the allotted ad space—and it makes them think twice about advertising with that publication again.
Knowing that the publisher is motivated to offer you remnant space is good for your advertising campaigns. Make sure you are aware of the publication’s deadline; then call right before that deadline and start your negotiations. If space is available and time is tight, the publication will most likely take your offer.
NEWSPAPERS: DAILY OR WEEKLY
Your chances of obtaining remnant space are even greater in newspapers. Unlike a monthly magazine, which can easily alter its page count, newspapers often have a set format and page count . . . and even tighter deadlines. And as fewer consumers are reading papers, advertising revenues are more important to them. This does not apply only to small town local newspapers.
About five years ago, we bought a full-page ad in USA Today for the discounted price of $1,500. We were advertising a $24 book on investing and would need only 63 orders to break even. Because the newspaper’s circulation was nearly 2 million at the time, getting 63 orders (a .00315 percent response) seemed like a very reasonable expectation.
To create the ad, a 24-page sales letter written by master copywriter Clayton Makepeace was converted into the tabloid space ad format. The order form was changed to emphasize an 800 number.
The result: 217 book orders. That’s an ROI of 347 percent on the $1,500 investment. That was good news. Even better news was that customers who ordered the book went on to have a lifetime value almost equal to direct-mail buyers. Plus, this test was an important breakthrough because it provided the company with a new channel of new customers.
However, had we paid the rate-card price for the ad, we would have lost almost $10,000.
Regardless of whether you are testing newspapers or magazines, be aware of that publication’s rates and deadlines—and you will be well armed to get the very best deals.
START WITH YOUR ABCS
The following is an excerpt from the Audit Bureau of Circulations (ABC) web site that explains the important services they provide to direct-print advertisers:
The Audit Bureau of Circulations is a third-party circulation audit of print circulation, readership and web site activity.
That data is disseminated into reports and made available in various formats. Accurate, credible reports are issued in comparable formats. Comparability is the key.
An ABC audit is an in-depth examination of a publisher’s records that assures buyers that a publication’s circulation claims are accurate and verifiable.
We also maintain the world’s foremost database of audited circulation and readership information. ABC’s reports and services are essential for buyers and sellers of print advertising to make informed business decisions.
With more than 4,000 members in North America, ABC is a forum of the world’s leading magazine and newspaper publishers, advertisers and advertising agencies. The organization provides credible, verified information essential to the media buying and selling process. ABC maintains the world’s foremost electronic database of audited-circulation information and an array of verified readership, subscriber demographics and online activity data.
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This is a resource to be used in three ways:
1. To expand your universe to publications you may never have even heard of.
2. To verify that you are getting what you are paying for.
3. To clarify if the publication has a paid or controlled circulation base.
Once you have identified the publications you think may be worth advertising in, you need to go one step further and download their media kits. Again, the Internet has made this process so much easier and faster.
Years ago, you had to call a publication and request that a media kit be sent to you. Then, you had to wait for it to arrive. Today, you can go online and view the media kit instantly.
Here is what Canadian Heritage, Canada’s cultural preservation organization, has to say about media kits:
A media kit is the opportunity to use materials to showcase the magazine’s or newspaper’s strengths and convey credibility to advertisers. It shows advertisers what the publication can do for them. It’s a chance to tell your story. It is what you should use to assess the publication. Therefore, it must contain a clear statement about the publication and the audience it delivers to.
Credibility is crucial. This is because sales reps are selling an intangible product. They can’t promise an advertiser that he’ll get results—they can only rely on the experience of past and current advertisers. This is why so much of the media kit is geared towards credibility—numbers, research, audits, testimonials, etc.”
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A good media kit will contain:
• A mission statement
• An editorial profile—a short description of the magazine’s editorial content
• An editorial calendar—indicating publishing and advertising deadlines
• A reader profile—psychographic information on their likes and what they spend time doing
• An audience profile—demographic information such as gender, age, income, education, and occupation
• Rate base—the publication’s readership, both newsstand buyers and subscribers, both paid and controlled
AND LET’S NOT FORGET ADVERTISING RATES!
So how do you know if you are getting a good rate for your advertising?
The best way is by figuring out how much it costs you to reach 1,000 readers. This is known as CPM, or cost per thousand. Here’s the formula:
CPM = (Cost of Ad/Circulation) × 1,000
For example, if a full-page ad in a magazine costs $2,300 and the circulation is 135,000, you divide $2,300 by 135,000, and then multiply by 1,000. This gives you 17.04. In other words, it will cost you $17.04 to reach 1,000 people.
With this handy calculation, you can compare the cost of advertising in any publication you find.
BIRDS OF A FEATHER FLOCK TOGETHER
Many marketers do not get their expected results in space advertising simply because they fail to do one thing.
They think that because they have followed all the steps described above, they’re safe. But they miss the simplest step of all. Don’t make the same one!
Before you sign on the dotted line for your space advertising, get the last six to twelve issues of the publication. Then go through every page and chart the following:
• How many ads are direct-response ads?
• How many similar companies are advertising?
• How many similar offers are being advertised?
• How many of the direct-response ads and the similar companies and the similar offers have been repeated in the last six to twelve issues?
When marketers are getting expected results or better, they do not stop or pull a campaign.
This is information you will not get from a media kit or sales rep. But it is crucial. You must go through this process every time you do a print-ad campaign.
DIRECT IS DIRECT IS DIRECT!
We talked about all the different tactics of direct e-mail marketing in Chapter 3 and about direct-mail marketing in Chapter 7. Well, the fundamental principles are the same for direct space.
If you are already having success online or in the mail, you are in a very good position to venture into direct-space marketing.
We say that because if you have a direct-mail or e-mail campaign that is working, it means you have thought about your copy concept and your offer. If your first channel of marketing is direct space, that is okay, too. However, do not try to write copy for a quarter-page ad.
Go through the same copy guidelines we discussed in Chapter 7. Brainstorm the idea and the offer. It’s all right if you end up writing 10 or 12 pages of copy, even though you can only use about a quarter of it.
Once you are satisfied with that copy, it’s time to peel it down to an appropriate amount. But before you send it off to the printer—test it!
Test your headline in pay-per-click (PPC) ads. Test the copy for the entire ad on your web site. If you don’t have a web site, test it on a competitor’s site. It will be cheaper to test it on a web site rather than in print—and you will have results within hours.
WHEN TO BEGIN YOUR DIRECT-SPACE CAMPAIGN
In any multi-channel campaign, we recommend starting with these three “directs” in this specific order:
1. Direct e-mail marketing
2. Direct-mail marketing
3. Direct-print marketing
There are several reasons for this sequence:
• You go through the same creative process for all three channels. But by approaching each channel in the above order, you are able to go through the creative process once . . . and then “slice and dice” your existing copy into direct-mail and direct-space ads. This is the best way to leverage the work of your marketing team and your copywriter.
• You can approach your customer in the way he or she is most likely to respond. Your media/lists are interchangeable. Let’s say you do an endorsed e-mail campaign to
Newsmax.com, and it does well. Next, you test banner ads on their web site, and that shows good results. Next, you rent their mailing names for your direct-mail campaign and, at the same time as that campaign is set to arrive in your prospects’ mailboxes, you place an ad in the Newsmax magazine. These ads are all directed toward like-minded people (birds of a feather) who will choose to respond to your offer in different ways.
• This sequence gives you the biggest bang for your marketing buck. You can test your creative efforts in the most cost-effective channel first. Starting with direct e-mail allows you to get quick and inexpensive results. You can easily interchange PPC ads to find the headline that works. You can easily test two e-mail endorsements against each other to find the most effective copy. And once you get those results, you can “roll out” to direct-mail and direct-space ads.
We will go into greater detail on launching your multi-channel campaign in Chapter 15. But in the meantime, if you want to get started now, use these three “directs” and start gathering information on your possible media buys.