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Shaping the Future of the NewspaperANALYSING STRATEGIC
DEVELOPMENTS AND OPPORTUNITIES IN THE PRESS INDUSTRY
STRATEGY REPORTVolume 8 N2 JANUARY 2009 WAN
BuildingRelationshipswithAdvertisingAgencies
www.futureofthenewspaper.comAll the strategy reports are
available to WAN members and subscribers at the SFN Web site
Advertising agencies andnewspapers are intertwinedand
interdependent. How can they build a mutuallybeneficial
relationship under a yin-yang scenario?
8.2
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Shapingthe Future
of the Newspaper
www.wan-press.orgA WORLD ASSOCIATION OF NEWSPAPERS PROJECT,
SUPPORTED BY WORLD LEADING BUSINESS PARTNERS
www.atex.com/ THE MEDIA INDUSTRYS LEADING PROVIDER OF CONTENT
MANAGEMENT SOFTWARE AND SERVICES
www.man-roland.com/en/p0001/index.jspA LEADING COMPANY FOR
NEWSPAPER PRODUCTION SYSTEMS
www.telenor.com/THE LEADING NORWEGIAN TELECOMMUNICATIONS, IT AND
MEDIA GROUP
www.norskeskog.com/A WORLD LEADING PRODUCER OF NEWSPRINT AND
MAGAZINE PAPER, WITH 18 PAPER MILLS AROUND THE WORLD
WORLD ASSOCIATION OF NEWSPAPERS, 2009
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TABLE OF CONTENTS
Executive Summary 5Introduction 7
1 The Advertising Agency and Buying Landscape 11Media Agency:
The Players 11Media Scheduling: Reach and Frequency 13Advertising
Agencies 15Advertising Expenditure 18
2 What Agencies Want from Newspapers 25Starcom MediaVest Group
27Dentsu 29GroupM 30Horizon Media 31Davis Harrison Dion
33ZenithOptimedia 34Mediaedge:cia 35
3 Survey Overview 37Media Buying Landscape 37Newspaper Ad
Revenue: Print vs. Online/Digital 39Newspaper Ad Planning
39Newspaper Ad Buying & Pricing Model 39Satisfaction of Working
with Newspaper Publishers 40Newspaper Ad Evaluation 40Cross-Media
Ad Campaigns 41
4 What Newspapers Want from Agencies 43New York Times Media
Group 43The Guardian 45Cox Newspapers 45AJC Media Solutions 45
5 Can You Sell to Agencies? 47Principles of Selling to Agencies
and Key Clients 48The Agency-Client Relationship: When to Involve
the Client 50Guidelines for Direct Contact with Clients 51
Conclusion 53
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The relationship between newspapercompanies and advertising
agencies ischanging. Advertising budgets are shiftingaway from
newspapers and into digital mediain many parts of the world, as
agencies changetheir organisational structures, strategies
andobjectives. Newspaper companies andadvertising agencies have had
a yin-yangrelationship for as long as agencies have beenaround, for
more than 100 years. In Chinesephilosophy, the yin-yang concept
ischaracterised by two opposing forces that areintertwined and
interdependent.
What business is an advertising agency in? Inthe advertising
creation and placementbusiness. What business is the media in?
Theadvertising delivery business, according toMedia Selling:
Broadcast, Cable, Print andInteractive, by Charles Warner and
JosephBuchman.
The interdependency of these roles in the saleand distribution
of advertising sometimescreates friction, differences of opinion
andeven inspires newspapers and agencies tojockey for a dominant
position.
Sometimes it feels like two warring parties aregetting together,
says one print-buying advertisingagency executive interviewed for
this report.
Among the thousands of newspapersworldwide, each one depends on
agencies for acertain percentage of advertising revenues. Inthe
United Kingdom, national newspapersreceive about 80 percent of
their non-classifiedadvertising revenues from ad agency
clients,while regional newspapers receive just 20percent. In the
United States, nationalnewspapers each receive about 90 percent
oftheir non-classified ad revenue from agencies,while local
newspapers receive roughly 10percent. The remaining advertising
revenue isearned from in-house sales departments andselling
advertising to local clients.
This Shaping the Future of the Newspaperreport, Building
Relationships with AdvertisingAgencies, goes to the heart of
matter, to helppublishers and ad agencies understand oneanother's
needs better, and ultimately, to buildbetter relationships for the
future. The reportsmain objective is to maximise
newspapersrevenue-making potential with agencies.
Executive Summary
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JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
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The report chronicles numerous interviews withmedia buyers and
planners and advertisingagency executives about relationships
withnewspapers, and enumerates suggestions topublishers about
practices, interactions and ratestructures. The report also details
interviewswith publishers about their businessrelationships with
agencies, and their efforts toimprove their relationship through
bettercommunication, more transparency, fewer ratecards and more
efficiencies in processes ofbuying newspaper advertising space.
Finally, the report analyses the current andfuture relationship
improvements, factoring inrecommendations and the impact of the
seismicchanges going on in media and agencies today.The interviews
with media-buying agencyexecutives in New York, London, Paris,
Tokyo,Zurich, New Delhi and beyond provideinspiration to improve
relations betweenagencies and newspapers. Some of theobservations
of the agency executives include:
Buying newspaper advertising is complicated.You cant do one-stop
shopping (acrossnewspapers).There are too many rate cards.Invoices
are frequently wrong. Contract ratesare not always in the
newspapers computersystems.Sales reps arent always informed about
ratecard prices or why prices have inexplicablyrisen.Newspaper
advertising prices havent caughtup with declining
circulations.Sales reps dont understand our
clientsneeds.Cross-platform audience information is good,but Im not
sure how well use it.Newspaper usage data must be about now,not six
months old.There are a lot of choices out there for mediaplanners.
Newspapers need to become morecompetitive with new pricing and new
offers ofvalue.Editorial rules the roost in decision makingabout
whether innovative ads will run or not.Its hard to guarantee a
position on a page.Invoices are frequently wrong, and it takes
along time to clear up the problem.
Similarly, several newspaper advertisingexecutives were
interviewed about their businessrelationships with agencies. If
newspapers couldchange how they work with agencies, they
would improve a variety of factors, including:
Some agencies collaborate with us. Othersare just bullies.Some
agencies are hard to deal with. Theyare only interested in
price.Trading has become more of a negotiationwhich is more
commoditised a tradingenvironment and not sales.Agencies dont trade
on value. Thats justgone, gone, gone. If we could trade on the
truevalue of our brands, it would be a betterscenario.Agencies
ultimately need to discover abusiness model that worksagencies
areterrified, they are doing more and more forless and less.We want
more transparency about the clientand its campaign objectives, and
also aboutcampaign performance so we can learn for thenext
campaign.We want agency and publisher to act onbehalf of the
customer.We want to get into the campaign during therequest for
proposal (RFP) process.We should make advertisers and agenciesaware
of our value.Based on the experiences working withagencies, they
primarily think we are anewspaper. What we are doing is to build
anunderstanding with them that we are muchmore than that.
The report provides analysis and conclusionsfocused on improving
the business relationshipbetween newspapers and advertising,
including:
Improving transparency in decision-makingand business practices
among agencies andnewspapers. Streamlining processes on both
sides,including fewer rate cards, electronic billingand payment,
and one-stop shopping on thenational level. Allowing newspapers to
be more influential inthe media buying process, at an earlier
stage. A better flow of information aboutnewspapers value
propositions. A better and more scientific accountability
toagencies about newspapers reach, frequencyand advertising
campaign success. A mutual understanding of advertising clientneeds
for each campaign. An expanded sense of newspapers as brands,with
reach and frequency capabilities acrosstheir print and digital
channels, rather than justcirculation alone.
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By Robert Ray, marketing director, the Newspaper Society, United
Kingdom
In my agency life, I have been lucky enough tohave worked with
some of the worlds biggestcompanies and brands, which has
naturallymeant being at the sharper end of getting thevery best out
of media owner relationships,and well beyond simply getting a deal.
In thepast four years working with the NewspaperSociety, I have
spent a great deal of time withagencies to help them better
leverage thestrength of local media across the UnitedKingdom.
So, in providing some personal thoughts forthis piece, I can
call upon both past andpresent experience from an agency and
mediaowner perspective.
Why bother building a relationship with anagency?
In an era when many deals between mediaowners with agencies are
annualised and muchmedia is traded as a commodity, surely its
about setting up the deal, rather than managingthis across the
year, isn't it?
No. We need to go back a little in history tosee why agency
relationships are critical tomaximise share, volume and
importantlystimulate and drive cross-platform initiatives.
Heres a little history to set the context.
I started at my first advertising agency in the1980s. I was a
fresh-faced, 21-year-old throwninto the hustle and bustle of a
major ad agency.The relative glamour of checking vouchercopies to
see if our clients ads (all black andwhite in those days, of
course) had appearedon the right day and in the right position was
astep up from my previous career training asan accountant. My first
agency job was in thepress buying department, which also served
asmy first experience in building relationshipswith media
owners.
In the same press buying department, therewere also several
elder statesmen of thebusiness. What is fascinating is that they
hadbeen through times of very limited media
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Introduction
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availability and an effective rationing of mediaspace. Just
after World War II, paper wasrationed, which led to severe
restrictions inadvertising space. This was before commercialradio
and television existed in the UnitedKingdom, and a good generation
away fromanything resembling the Internet not a badtime to be in
newspaper advertising, I suspect.The relationship-building in these
times wasperhaps the reverse of where we are today, andthose times
of media space scarcity must havebeen interesting indeed.
The UK national press groups have longsince moved from their
former addresses onLondon's Fleet Street, still synonymous withthe
country's press, where the elderstatesmen I first worked with
beganpractising their trade. Even when I firststarted at the
agency, many of our nationalpress deals were still conducted over
aliquid-based lunch at one (or sometimesmore) of Fleet Streets pubs
or drinking dens,including Ye Olde Cheshire Cheese, TheBell,
Vagabonds and The City Golf Club.
So, after the war and during a period ofscarce print supply,
little other mediacompetition and increasing advertiserdemand, the
relationship building withagencies seems to have consisted of
mediabuyers forming an orderly queue outsidesuch Fleet Street pubs
to buy newspapersales reps drinks in the hope of then securingwhat
limited space was available in theirnewspapers presumably at
rate-card cost!Most business was, of course, conducted inthe
morning before the alcohol-fuelledafternoon gave way to the commute
home.
There are many more tales I heard about thosegood old days,
although most arent fit forpublication! Yet, in an era of
restricted supplyand huge demand, there was more of an onusupon the
agency for building a relationshipwith the media owner, rather than
vice versa.
Times have clearly (and thankfully for thelivers of many media
sales folk) moved on.The explosion and fragmentation of
mediachannels is more than well documented. Andfor agencies, this
has its own set ofchallenges creating the most compellingoffering
in a very well supplied marketplace,creating the most appropriate
structures,retaining and building business (as seeminglylower terms
of business) and so on.
To my earlier point: Why bother building arelationship with an
agency?
In answering this, I have three key points:
1. The benefits of building a relationshipwith an agency2.
Getting better receptivity to your pitch3. Things to avoid (like
the Plague)
1. The benefits of building arelationship with an agency More
volume Increased share Access to more clients/brands Earlier
information on potential/forthcomingcampaigns Better scope for
cross-platform deals Access to more people in the agency (not
justbuyers) . all leading to more volume, more share
I won't elaborate on these, as they're prettyobvious, but I will
give you a left field view.When I was on the agency side, we
wouldoften be asked about our relationships withmedia owners what
deals could we get, howcould we improve a client's existing
deals,what extra added value could we achieve, andso on. In other
words, what were the benefitsof the relationships we had with media
owners?
Yes, we could do all of the above, and more.However, in many
instances the biggest point-scorer wasnt simply what we could get
them(clients) in to, but what we could get them outof. Favours.
Relationships dont guaranteeeverything, but what they most
certainly do ishelp get you out of a less than
desirablesituation.
A client has a late copy problem A client has an issue with
budgets A client needs to shift campaign periods Etc. etc. etc.
The strength of a media owner relationship,and not simply our
volume or clout, would sortthese. How many favours do you need?
Itmight sound intangible, but it does matter andit makes a
difference.
So how about gaining better receptivity to yourpitch?
All of us pitch for business. Either for majorcontracts or for
smaller everyday deals. Dorelationships with agencies help this
process?
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
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2. Getting better receptivity to your pitchSome of you have
annual deals with agencies,while others trade on more of an ad hoc
basis.Some of you sell print only, while some sellcross-platform
campaigns. Theres not a one-size-fits-all answer to getting better
receptivityto your sales pitch, but I can offer someconstructive
advice.Most major advertisers are involved inanywhere between five
to 15 or more pitchesper year, across everything from media
tocreative to point-of-sale. Most major mediaagencies are involved
in a similar number ofpitches every year, and are exposed
tohundreds of pitches from media owners eachyear.
In various consultancy projects, I have spokento agencies
regarding their exposure to suchmedia owner pitches.Here are the
three guiding principles forsuccess (beyond the obvious, such as
gettingyour pricing right for your market):A. Make your pitch
relevant. Avoid off-the-shelf. Ensure your proposal adds
significantvalue to the communications strategy of thebrand you are
pitching for.
Of course, if you (or your team) had a goodworking relationship
with the agency youwouldnt be pitching blind and would be
wellinformed to deliver against the above threepointers.
And, surprise, surprise, getting the people rightis critical.
Two quotes typify the response tobad pitches:the terrible pitches
from media ownersoften come down to the individuals.we once had a
dire pitch from X (a majorpublisher)and afterwards the sales
directorapologised and said shed not seen thepresentation
before.There are many factors that make for awinning pitch to an
agency. Work I havecarried out suggests three very clear
pointersfor success. Once again, these may or may notseem obvious,
but from a large quantitativestudy I ran for a major UK project
they wereunanimous amongst the sample. What I havealso added are a
number of quotes that sum upsentiments agencies have about media
ownerpitches.
Have a clear brand and business focus:Listen to what they need.
Sales folk have atendency to sell or talk at, whereasagencies and
advertisers prefer media ownerswho listen to the requirements of
the brief andthen respond accordingly. More specifically,agencies
respond more to those media ownerswho not only listen, but then
respondeffectively to the brand and campaignrequirements.(media
owners) need to think more aboutthe questions we have on our
brands.understand the agenda of who yourepitching to.too many just
give information (and sell)when a meeting should be a discussion.B.
The first step is all about listening. Turn a presentation at them
into adiscussion with them.Have the right people on the
business:Chemistry. It's not a trip to the sciencelaboratory, but
simply about getting along withagencies is important. This again
may seemobvious, but the next time you (or your seniormanager) gets
a call from a top person at anagency saying were not getting on
with Xor I think we should get Y moved off thebusiness, take it
seriously. You shouldquestion why the situation has risen to a
levelnecessitating the agency chief calling you tosuggest a change
in your representation of theagency. Although the natural
inclination (minetoo) is to ignore the agency's view andcontinue to
force your person upon them, myown view is to change representation
as soonas possible!agencies buy good people.absolutely bloody
vital.and passion.casting the wrong people is a nightmare.C. The
second step is totally about chemistry.Do take time to think about
having the rightpeople on a particular agencys business anddont shy
away from changing the currentformula if you receive negative
feedback froman agency. It does remain a people business.
Make the presentation or pitch totallyrelevant: Less is more.
This is a very wellworn clich, yet everyone reading this musthave
been on the receiving end of apresentation where there is simply
too muchcontent, or too much unnecessary spiel.
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Every year, we run various industry awards.One of the awards we
run is for the best cross-platform sales pitch, which is one that
hastruly leveraged the various channels of localmedia (from
newspapers to Internet, events,mobile, etc.). We receive some
fantasticentries. We also receive entries that could befantastic
but are so cluttered with unnecessaryinformation, background and
detail that itdetracts from the great idea.
I dont need 100 chartsdont even needPowerpoint whats important
is whats in itfor me and my brands.The third point is to keep
quality over quantityin mind. Agencies (and advertisers)
arestretched for time, and far more responsive ifmedia owners waste
less time and provide arelevant, results-driven response to a
brief.
The best pitches, those which will not onlyreceive a great
reception but will also lead toincreased business, tie in with the
three keypoints I have observed above.
3. Things to avoid (like the Plague)Thankfully, the Great Plague
of 1665 was, inLondon at least, quashed by the Great Fire ofLondon
in 1666. The post-war press buyers Imentioned at the beginning of
this piece pliedtheir trade not too far from Pudding Lanewhere the
Great Fire started. As I mentioned atthe outset, the relationship
with agencies hasmoved on significantly. The best
relationshipstoday are true partnerships where the mediaowner works
with the agency to deliver themost compelling communications
solutions forthe agencys clients.
This isnt to suggest that trading disputes dontand shouldnt
arise. They do, and of coursethey should!
But the media owners and agencies I know orwork with would
wholly endorse a partnershipapproach as the most fruitful way of
developingan agency/media owner relationship. Andlistening, having
the right people, and tailoringa response to briefs are the top
three ways towin more business with your relationship.
Things to avoid are, quite simply, those factorsthat work
against these top three factors: beingbog-standard and boring, not
listening andfailing to address the core business issue
orcommunications task.
Failing is simply about failing to address whatI call The Big
Three: Listening, Chemistry andRelevance.
If you can focus more on these as they relate toa specific
agency and that agencys specificbusiness, then youll stand a much
greaterchance of developing a stronger relationship,and from that,
increasing your volume/shareand increasing business across your
multitudeof platform offerings.
I hope this provides a helpful personalperspective on how to
build better agencyrelationships. These are challenging times andI
am convinced that stronger agencyrelationships will yield better
business resultsgoing forward.
Robert Ray is the marketing director for theUK-based Newspaper
Society, a trade bodywith a member portfolio including 1,300
localnewspapers, 1,100 Web sites, more than 750local magazines and
supplements, 36 radiostations and two TV stations. Prior to his
workwith the NS, Ray spent most of his careerworking in agencies,
from a trainee levelthrough managing director level in
agencynetworks across Europe, the Middle East andAsia, as well as
running a specialist mediaconsultancy firm working with both
agenciesand media owners in the United Kingdom andacross Europe.
Ray has worked with some ofthe worlds biggest companies and
brands,such as Procter & Gamble, Unilever,Anheuser-Busch and
Barclays.
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
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Of the tens of thousands of advertisingagencies in the world,
many are part of globalagency conglomerates with offices in
theworlds major cities. Most mass media,including newspapers,
depend on agencies forsome or most of their retail
advertisingrevenues.
In the United Kingdom, for example, nationalnewspapers receive
about 80 percent of theirnon-classified advertising revenues from
adagency clients, while regional titles receive just20 percent. In
the United States, the model issimilar. The four national dailies,
USA Today,The Wall Street Journal, The New York Timesand The
Washington Post, each receive about90 percent of their
non-classified ad revenuefrom agencies, while local newspapers
receiveroughly 10 percent. The remaining advertisingrevenue is
earned from in-house salesdepartments, which sell advertising to
localclients.
The pattern of national and regionalnewspapers reliance upon
advertising agencyrevenue is found on every continent, and
mostmajor countries.
The relationship between newspapersandadvertising agencies has a
significantimpacton the volume and value of theadvertisingtrading
relationship.Understanding the wayagency workers makemedia planning
andbuying decisions isessential newspaper representatives whowork
with agencies.
There are four basic categories of advertisingagencies:
Media-buying, creative, full serviceand specialty. For the purposes
of this report,we are referring to relationships withagencies with
media-buying functions.
Newspaper sales people who liaise withmedia agencies explain the
newspapersvalue proposition, including its ability toreach
targetgroups, its strengths comparedwith othermedia, and about its
overall reachandfrequency with print and
digitalassets.Understanding the players andprocesses of media
decision making equipsthe newspaper representative with
theammunition to be more effective salespeople. Here is an example
of a typicalmedia agency structure:
1. The Advertising Agency and Buying Landscape
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Media agency: The players Managing Director/CEO:
Mainresponsibilities are to lead the organisation toprofitability
and effective use of human andbusiness resources. Group Manager:
Key role is to manage agroup of clients and is responsible
formanaging the media departments staff andtime on group accounts.
Strategic Planner: Responsible for planningmedia for clients,
including whom to target,which media, and when, according to
theclients marketing objectives, as outlined in theclients brief.
Research Analyst: Provides data andmaterials to planners and buyers
to enablesound media buying decisions. Investment Manager:
Responsible foroptimising rate negotiations and buying withall
media placed by buyers. Buyer: Negotiates and implements buys
forall media. Media Assistant: Administrative support toagency
departments.
A typical campaign process between advertiserand agency:1.
Client Briefing: The client provides a briefabout the product or
service to be advertised,and detailed expectations for the
campaign2. Strategic Planning: The process ofevaluating the
appropriate mix of mediaplatforms and estimated campaign costs3.
Implementation Planning: Identifies thebest ways to develop the
campaign
4. Media Buying and Negotiating: Tonegotiate rates and book
space in print andairtime in broadcast5. Post Monitoring:
Evaluating theperformance of the campaign againstexpectations6.
Invoicing: Billing all booked mediaAdvertising clients may state
any number ofobjectives for their prospective campaigns, in
abriefing to the agency, including: Increasing awareness through a
trial offer Maintaining its current position and reinforcing
Introducing a new brand, repositioning acurrent brand or
relaunching a declining brand Preventing erosion by a competitor
Improving image or reputation Changing attitudes Supporting sales
forces and franchises Eliciting a direct response with a coupon
orwrite-in offer
The briefing serves as a foundation for themedia planning
process. The media strategistbuilds the framework for the
campaign,including choosing media that will achievethe advertisers
objectives. If the advertiserwants to reposition a car from a
middle-aged,female profile to a young target audience,then the
strategist will find media in print,broadcast and Internet that
reach youngaudiences in the way that achieves the reachand
frequency, demographic, geographic,campaign timeframe and cost
parameters.
The media planner will scour researchresources in order to
execute the strategists
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
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plan. The planner will focus on the consumerand their media
habits in order to makeinformed decisions about media
selection.
Among the choices of media are newspapers,television, radio,
magazines, cinema andoutdoor, out of home/ambient
environments,direct mail, email, mobile phones, the Internet,blogs,
video games, CDRoms, merchandise,music, etc. In addition to using
research,planners consider the strengths andweaknesses of each
medium and dovetail thecharacteristics of the media with the
objectivesof the campaign.
Media Scheduling: Reach and FrequencyUsing the variety of media
research toolsavailable to them, media planners consider theamount
of reach and frequency that is requiredby the campaign, and then
schedule mediaflights to achieve the objectives. A mix ofmedia is
often selected to run over a variety ofintervals to extend the
campaign over time.
Before proceeding to the implementationplanning phase, the media
agency presents theplan and proposed media schedule to the
client
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Comparative Strengths and Weaknesses of Media
Source: Media Federation of Australia, industry research World
Association of Newspapers 2008-2009
MediaTelevision
Radio
Magazines
Newspapers
StrengthBuilds high reach quicklyAble to target all demographic
groupsGeographically selectiveImpact through sight, sound and
movementIntrusive (in the home)Call to action with direct
responseHighly researched
Builds frequency quicklyEasier to book a campain at short
noticeMore accountable radio surveysTarget specific
demographics/psychographicsGeographically selectivePersonal
mediumMore negotiation flexibility with added valueLower production
costsCredible environment (talkback)Creatively flexibleNational
coverage with one insertionProvides detailsTarget specific group
e.g. 4wd enthusiastsHigh use by womenMost are a paid forHigher
level of involvementEditorial compatibilityCreative opportunities
e.g. gatefolds, pop-upsHighly researchedLongevity of
advertisingHigh quality productionQuality image associationBuilds
high reach quicklyMore detailFor major metros and regionals, paid
forTailored environmentsMore accountable highly
researchedGeographically selectiveProduction costs are generally
lowBook at short noticeOffers colour to create impactCredible
environmentNegotiable on editorialCan accommodate coupons/direct
response
WeaknessHigh production costHigh capital media costDifficult to
obtain specific programmes short termChannel surfingIn the case of
Free to Air TV, not a paid for mediumHigh level of ad clutterCant
measure out of home viewing for major eventsProgrammes can be
recordedNot paid forChannel surfingExpensive for national
coverageMore expensive for a broad target groupLimited creative
flexibility (reliant on sound only)Lower reachReception can be low
quality
Longer lead time particularly for monthly magazinesMore
difficult to book by regionsHigh level of clutterSlow to build
reachPassiveLacks urgency
Short lifespanNo readership figures for specific sectionsExcept
for business skewed papers,requires a high number to provide
national coverageMore difficult to reach younger audiencesAds can
get lost in editorialColour reproduction quality
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for approval on the target audience, mediachannels, reach and
frequency, flighting,geographic targets and costs. After
approval,the buying team goes to work on buyingmedia, according to
the schedule. First, buyersresearch the options available across
media onthe schedule, including TV ratings, print ratecards,
special print sections or major eventsand holiday periods that may
influence mediaconsumption patterns. After determining
keyobjectives, the buying team books the mediawith media outlets,
and seeks ways to savemoney for the advertiser. For example,
the
buyer may work with the newspaperrepresentative to get a
discount for volume, orto get elevated prominence for the
campaign.The newspaper titles are usually selected at
theimplementation planning stage, so the buyerrefines that
selection based on further researchinto target audience, cost and
the like. Thebuyer is responsible for reaching campaignobjectives
and not to exceed the set budget.Buyers will refer to rate cards,
which are oftenfound on newspaper Web sites, or areaggregated on
such services as the Standard Rateand Data Service (SRDS) in the
United States.
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
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Top 10 U.S. Advertisers in Newspapers, Internet
Source: Advertising Age, 2008; TNS Media Intelligence World
Association of Newspapers 2008-2009
Rank
Newspaper12345678910Internet (Display) 12345678910
Advertiser Total U.S. Medium as 2007 2006 % change spending 07 %
of total (US$ millions) (US$ millions)
Verizon Communications 686.7 686.9 -0.0 3,016.1 22.8 Macy's
609.7 715.3 -14.8 1,389.7 43.9 Sprint Nextel Corp. 460.6 495.7 -7.1
1,903.2 24.2 AT&T 328.3 483.5 -32.1 3,207.3 10.2 Time Warner
311.6 298.4 4.4 2,962.1 10.5 Fry's Electronics 229.3 215.1 6.6
312.1 73.5 Procter & Gamble Co. 213.7 207.6 3.0 5,230.1 4.1
Sears Holdings Corp. 200.7 233.1 -13.9 1,627.8 12.3 General
Electric Co. 200.7 215.1 -6.7 1,791.3 11.2 Walt Disney Co. 185.2
185.0 0.2 2,293.3 8.1
IAC/InterActiveCorp 314.4 123.0 155.6 806.1 39.0 General Motors
Corp. 212.0 118.2 79.4 3,010.1 7.0 Experian Group 193.1 129.4 49.3
330.9 58.4 Apollo Group 192.4 123.5 55.8 262.2 73.4 Verizon
Communications 189.1 111.4 69.7 3,016.1 6.3 E-Trade Group 186.9
106.9 74.8 300.7 62.2 Ford Motor Co. 163.5 99.1 65.0 2,525.2 6.5
FMR Corp. (Fidelity Investments) 142.8 97.4 46.6 499.0 28.6
Scottrade 142.5 105.0 35.8 204.4 69.7 Microsoft Corp. 142.2 82.0
73.4 959.5 14.8
Measured ad spending in medium
Top Global Advertising Agencies
Source: Advertising Age DataCenter, 2008 World Association of
Newspapers 2008-2009
Rank Worldwide revenue2007 2006 Agency [Parent] Headquarters
2007 2006 % change (US$ millions) 1 1 Dentsu Tokyo 2,171 2,185 -0.6
2 2 BBDO Worldwide* [Omnicom] New York 1,742 1,540 13.2 3 3 McCann
Erickson Worldwide* [Interpublic] New York 1,619 1,479 9.5 4 4 DDB
Worldwide* [Omnicom] New York 1,432 1,264 13.3 5 6 TBWA Worldwide*
[Omnicom] New York 1,292 1,135 13.8 6 5 JWT* [WPP] New York 1,237
1,140 8.5 7 7 Publicis [Publicis] New York/Paris 1,004 974 3.0 8 8
Hakuhodo [Hakuhodo DY Holdings] Tokyo 943 886 6.4 9 9 Y&R*
[WPP] New York 907 820 10.6 10 10 Ogilvy & Mather Worldwide*
[WPP] New York 812 770 5.5
-
Advertising Agencies
The top 100 advertising agencies worldwidecontrol the majority
of the advertising spendaround the globe. Most agencies are
structuredto focus on just one task, either buying or
creative. Most are also still silo-based intheir organisational
structure, that is, theagencys departments centre on one media,
andmost individual departments do notcollaborate. This decades-old
practice isstarting to change in the top media buying
VOLUME 8 REPORT N 2 BUILDING RELATIONSHIPS WITH ADVERTISING
AGENCIES
15
Top 10 World and U.S. Media Agencies
Source: Advertising Age DataCenter, 2008 World Association of
Newspapers 2008-2009
Rank Worldwide revenue2007 2006 Agency company [media unit]
Headquarters 2007 2006 % change (US$ millions)By parent company,
worldwide 1 1 WPP Group [Group M] London $2,070 $1,816 14.0 2 2
Omnicom Group [Omnicom Media Group] New York 1,759 1,571 12.0 3 3
Publicis Groupe [Publicis Groupe Media] Paris 1,590 1,416 12.3 4 4
Aegis Group [Aegis Media] London 1,348 1,091 23.6 5 5 Interpublic
Group of Cos. New York 780 705 10.6 6 6 Havas [Havas Media]
Suresnes, France 518 401 29.3
Rank Worldwide revenue2007 2006 Media agency [parent]
Headquarters 2007 2006 % change (US$ millions)Worldwide 1 1 OMD
Worldwide [Omnicom] New York $859 $790 8.7 2 2 Starcom MediaVest
Group [Publicis] Chicago 814 708 15.1 3 3 MindShare Worldwide [WPP]
London/New York 734 687 6.8 4 4 ZenithOptimedia [Publicis] New York
681 614 10.9 5 5 Carat [Aegis Group] London/New York, N.Y. 674 NA
NA 6 6 Mediaedge:cia [WPP] New York 641 539 19.0 7 7 MediaCom [WPP]
New York 592 535 10.7 8 8 Universal McCann [Interpublic] New York
410 355 15.5 9 9 MPG [Havas] New York 379 357 6.2 10 10 Initiative
[Interpublic] New York 276 255 8.2 U.S. 1 2 MindShare Worldwide
[WPP] New York $302 $278 8.9 2 1 OMD Worldwide [Omnicom] New York
299 290 3.0 3 3 Starcom USA [Publicis] Chicago 259 228 13.6 4 4
Mediaedge:cia [WPP] New York 243 197 23.5 5 5 Zenith Media USA
[Publicis] New York 215 189 14.1 6 6 Icon International [Omnicom]
Stamford, Conn. 200 NA NA 6 6 MediaVest USA [Publicis] New York 200
167 19.7 8 8 MediaCom [WPP] New York 175 162 8.3 9 10 Novus Print
Media Network [Omnicom] Plymouth, Minn. 150 NA NA 10 11 PHD
[Omnicom] New York 141 113 25.0 11 9 Universal McCann [Interpublic]
New York 140 130 7.7 12 12 Carat [Aegis Group] London/New York 118
NA NA 13 13 MPG [Havas] New York 91 80 13.3 14 14 Initiative
[Interpublic] New York 80 70 14.3 15 15 Optimedia International
U.S. [Publicis] New York 57 53 7.1 Outside the U.S. 1 1 OMD
Worldwide [Omnicom] New York $560 $500 12.0 2 2 Carat [Aegis Group]
London/New York 556 NA NA 3 3 MindShare Worldwide [WPP] London/New
York 432 410 5.4 4 4 MediaCom [WPP] New York 417 373 11.7 5 6
Mediaedge:cia [WPP] New York 398 342 16.4 6 5 ZenithOptimedia
[Publicis] New York 379 353 7.4 7 8 Starcom MediaVest Group
[Publicis] Chicago 308 275 12.2 8 7 MPG [Havas] New York 288 277
4.1 9 9 Universal McCann [Interpublic] New York 270 225 20.0 10 10
Initiative [Interpublic] New York 196 185 5.9
-
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
16
Top 100 Global Advertisers in U.S., by Medium
Source: Advertising Age DataCenter, 2008; TNS Media
Intelligence's Strategy World Association of Newspapers
2008-2009
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
Rank
Procter & Gamble Co.
AT&T
Verizon Communications
General Motors Corp.
Time Warner
Ford Motor Co.
GlaxoSmithKline
Johnson & Johnson
Walt Disney Co.
Unilever
Sprint Nextel Corp.
General Electric Co.
Toyota Motor Corp.
Chrysler
Sony Corp.
L'Oreal
Sears Holdings Corp.
Kraft Foods
Bank of America Corp.
Nissan Motor Co.
Macy's
Anheuser-Busch Cos.
Honda Motor Co.
Viacom
Berkshire Hathaway
PepsiCo
Nestle
Pfizer
News Corp.
Target Corp.
J.C. Penney Co.
McDonald's Corp.
Citigroup
U.S. Government
Home Depot
Wal-Mart Stores
Schering-Plough Corp.
Wyeth
JPMorgan Chase & Co.
American Express Co.
Yum Brands
Microsoft Corp.
Estee Lauder Cos.
General Mills
Kellogg Co.
Bayer
Dell
Kohl's Corp.
Deutsche Telekom
IAC/InterActiveCorp
Cincinnati
San Antonio
New York
Detroit
New York
Dearborn, Mich.
Brentford, Middlesex, U.K.
New Brunswick, N.J.
Burbank, Calif.
London/Rotterdam
Reston, Va.
Fairfield, Conn.
Toyota City, Japan
Auburn Hills, Mich.
Tokyo
Clichy, France
Hoffman Estates, Ill.
Northfield, Ill.
Charlotte, N.C.
Tokyo
Cincinnati
St. Louis
Tokyo
New York
Omaha, Neb.
Purchase, N.Y.
Vevey, Switzerland
New York
New York
Minneapolis
Plano, Texas
Oak Brook, Ill.
New York
Washington
Atlanta
Bentonville, Ark.
Kenilworth, N.J.
Madison, N.J.
New York
New York
Louisville, Ky.
Redmond, Wash.
New York
Minneapolis
Battle Creek, Mich.
Leverkusen, Germany
Round Rock, Texas
Menomonee Falls, Wis.
Bonn, Germany
New York
5,230.1
3,207.3
3,016.1
3,010.1
2,962.1
2,525.2
2,456.9
2,408.8
2,293.3
2,245.8
1,903.2
1,791.3
1,757.9
1,739.4
1,736.8
1,632.3
1,627.8
1,508.0
1,491.3
1,422.9
1,389.7
1,354.1
1,326.5
1,309.9
1,308.3
1,308.3
1,260.3
1,252.9
1,210.4
1,186.2
1,161.8
1,150.1
1,135.3
1,121.9
1,119.6
1,102.5
1,092.0
1,078.3
1,073.9
1,050.0
1,004.4
959.5
956.1
955.2
871.5
860.8
843.4
836.7
831.3
806.1
4,883.7
3,344.5
2,791.9
3,296.1
3,073.7
2,576.6
2,504.0
2,401.4
2,300.5
2,099.5
1,775.9
1,916.8
1,850.3
1,886.4
2,001.3
1,458.0
1,650.8
1,426.7
1,140.6
1,407.4
1,362.9
1,279.1
1,351.2
1,010.5
1,194.3
1,323.8
1,255.8
1,006.5
1,400.4
1,161.4
1,162.7
1,083.9
1,224.1
1,133.4
1,119.6
1,073.7
883.6
1,051.3
1,156.5
929.3
1,039.9
913.7
1,031.4
937.2
765.2
683.4
984.0
766.0
815.2
792.4
7.1
-4.1
8.0
-8.7
-3.6
-2.0
-1.9
0.3
-0.3
7.0
7.2
-6.6
-5.0
-7.8
-13.2
12.0
-1.4
5.7
30.7
1.1
2.0
5.9
-1.8
29.6
9.5
-1.2
0.4
24.5
-13.6
2.1
-0.1
6.1
-7.3
-1.0
0.0
2.7
23.6
2.6
-7.1
13.0
-3.4
5.0
-7.3
1.9
13.9
26.0
-14.3
9.2
2.0
1.7
1,529.8
962.2
871.7
948.2
1,224.6
872.0
1,269.9
987.6
905.8
1,335.5
590.0
734.4
685.6
591.4
764.2
850.1
867.1
425.5
1,088.6
469.6
372.0
879.4
477.5
500.6
536.4
418.7
567.1
501.2
363.1
455.6
686.4
341.3
684.4
471.2
542.9
549.8
589.7
643.2
700.8
526.2
266.2
516.0
792.9
286.0
309.3
387.4
295.2
397.2
224.4
313.8
3,700.3
2,245.1
2,144.5
2,061.9
1,737.6
1,653.2
1,187.0
1,421.2
1,387.4
910.3
1,313.2
1,056.8
1,072.3
1,148.0
972.6
782.3
760.6
1,082.5
402.6
953.3
1,017.7
474.6
849.0
809.3
771.9
889.7
693.1
751.7
847.3
730.7
475.4
808.7
450.9
650.7
576.7
552.7
502.3
435.1
373.1
523.8
738.2
443.5
163.2
669.2
562.2
473.5
548.2
439.5
606.8
492.3
964.1
59.4
92.3
373.6
280.6
300.4
387.1
402.1
207.7
278.4
46.4
124.9
186.1
182.6
140.7
324.4
62.5
499.8
22.3
193.2
87.3
38.2
196.1
79.1
102.1
174.9
159.0
225.2
78.2
107.9
71.4
51.3
157.7
126.6
64.0
114.3
54.4
94.7
6.1
103.8
4.0
165.8
131.6
90.0
142.1
102.5
187.5
31.6
3.2
19.5
Total U.S. ad spending
(US$ millions)
U.S. measured media breakoutfor 2007 (US$ millions)
1
2
5
3
4
6
7
8
9
10
15
12
14
13
11
17
16
18
31
19
21
24
22
41
27
23
25
42
20
29
28
34
26
32
33
35
48
37
30
46
38
47
39
45
56
59
43
55
52
54
Estim
atedunm
easured(U
S$ m
illions)
Head
quarters
Ad
vertiser
2006
2006
2007
2007
% chang
e
Measured
med
ia(U
S$ m
illions)
Mag
azines
213.7
328.3
686.7
149.9
311.6
131.5
13.0
50.9
185.2
31.6
460.6
200.7
34.8
120.8
127.8
34.4
200.7
55.6
116.0
38.8
609.7
11.1
56.8
104.6
29.5
23.7
50.3
33.3
168.1
159.6
159.7
4.5
52.4
29.7
97.2
31.9
6.0
9.1
93.0
56.9
3.4
25.9
1.1
95.8
9.4
16.1
124.2
148.4
152.3
3.7
New
spap
er1.8
108.6
63.7
45.2
54.3
18.2
0.9
4.8
48.0
0.4
60.5
28.5
23.2
8.1
20.0
0.8
1.1
0.9
8.0
16.3
2.2
36.8
5.5
25.1
23.3
13.8
2.9
1.2
20.1
8.9
0.3
45.7
5.7
8.5
1.8
1.2
0.0
0.4
15.7
7.8
5.5
12.0
1.5
0.1
3.2
0.9
0.9
0.4
8.3
1.4
Outd
oo
r
2,414.2
1,356.4
906.8
1,176.8
908.4
982.1
742.4
879.4
664.5
543.7
575.4
482.8
752.0
750.6
570.9
407.9
437.3
476.8
131.2
653.0
236.0
341.3
548.5
491.8
444.9
612.3
429.6
456.6
334.0
371.7
186.1
601.6
207.0
378.4
282.9
304.9
426.7
296.4
201.8
243.6
680.7
92.0
24.7
470.8
384.7
330.6
129.5
218.1
393.9
133.9
TV
26.0
256.9
205.9
104.4
84.2
57.5
14.2
34.8
140.6
9.5
99.1
141.2
18.9
33.1
41.7
2.7
35.6
13.1
53.6
18.0
71.3
36.9
13.2
46.7
146.3
36.9
25.4
11.3
120.9
15.1
36.1
78.5
8.1
49.3
117.3
56.8
6.1
19.8
21.9
7.8
37.2
5.6
2.4
2.6
1.2
18.0
3.1
34.2
17.2
19.5
Rad
io
80.6
135.5
189.1
212.0
98.4
163.5
29.4
49.2
141.4
46.6
71.2
78.9
57.3
52.8
71.5
12.0
23.4
36.3
71.6
34.0
11.1
10.2
28.8
62.1
25.9
28.1
25.9
24.2
126.0
67.4
21.8
27.2
19.9
58.2
13.5
43.6
9.1
14.7
34.7
103.8
7.4
142.2
1.9
9.9
21.5
5.3
103.0
6.9
32.1
314.4
Internet
-
Source: Advertising Age DataCenter, 2008; TNS Media
Intelligence's Strategy World Association of Newspapers
2008-2009
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
Rank
Bristol-Myers Squibb Co.
Hewlett-Packard Co.
Coca-Cola Co.
Eli Lilly & Co.
Lowe's Cos.
Capital One Financial Corp.
Merck & Co.
Mars Inc.
Nike
AstraZeneca
Comcast Corp.
Clorox Co.
Campbell Soup Co.
Novartis
Hyundai Motor Co.
Reckitt Benckiser
Best Buy Co.
SC Johnson
Visa
IBM Corp.
Allstate Corp.
Kroger Co.
Boehringer Ingelheim
FMR Corp. (Fidelity Investments)
Sanofi-Aventis
Apple
MasterCard
eBay
Safeway
Progressive Corp.
Washington Mutual
State Farm Mutual Auto Insurance Co.
Doctor's Associates
Mattel
Coty (JAB Investments)
SABMiller
Diageo
Circuit City Stores
Wendy's International
Gap Inc.
ConAgra Foods
Molson Coors Brewing Co.
Energizer Holdings
Philips Electronics
Burger King Holdings
Alltel Corp.
Metro-Goldwyn-Mayer
DirecTV Group
Wells Fargo & Co.
Walgreen Co.
New York
Palo Alto, Calif.
Atlanta
Indianapolis
Mooresville, N.C.
McLean, Va.
Whitehouse Station, N.J.
McLean, Va.
Beaverton, Ore.
London
Philadelphia
Oakland, Calif.
Camden, N.J.
Basel, Switzerland
Seoul, South Korea
Slough, Berkshire, U.K.
Richfield, Minn.
Racine, Wis.
San Francisco
Armonk, N.Y.
Northbrook, Ill.
Cincinnati
Ingelheim, Germany
Boston
Paris
Cupertino, Calif.
Purchase, N.Y.
San Jose, Calif.
Pleasanton, Calif.
Mayfield Village, Ohio
Seattle
Bloomington, Ill.
Milford, Conn.
El Segundo, Calif.
New York
London
London
Richmond, Va.
Dublin, Ohio
San Francisco
Omaha, Neb.
Denver/Montreal
St. Louis
Amsterdam
Miami
Little Rock, Ark.
Los Angeles
El Segundo, Calif.
San Francisco
Deerfield, Ill.
796.3
786.6
776.8
774.2
757.1
757.0
751.8
715.9
702.9
697.4
692.6
683.2
670.3
665.6
650.9
601.3
598.3
591.9
580.6
558.7
536.8
506.3
505.3
499.0
493.1
491.8
488.7
487.5
473.7
459.7
445.0
431.2
425.7
424.6
421.2
419.7
414.4
401.8
404.8
394.2
384.9
382.8
375.4
365.0
364.0
363.8
363.2
356.4
355.7
355.4
690.6
828.9
755.1
511.1
838.8
864.9
1,024.2
660.1
654.2
1,066.5
628.5
660.1
559.3
950.8
809.0
471.6
572.2
621.3
580.5
571.4
500.8
508.3
191.8
334.1
490.8
383.7
500.9
453.3
507.7
368.2
443.0
360.7
425.5
415.8
331.6
422.8
382.6
410.9
435.2
489.4
298.2
406.0
361.9
309.8
357.0
368.4
228.3
359.7
393.7
306.4
15.3
-5.1
2.9
51.5
-9.7
-12.5
-26.6
8.5
7.4
-34.6
10.2
3.5
19.9
-30.0
-19.5
27.5
4.5
-4.7
0.0
-2.2
7.2
-0.4
163.4
49.4
0.5
28.2
-2.4
7.5
-6.7
24.8
0.5
19.5
0.1
2.1
27.0
-0.7
8.3
-2.2
-7.0
-19.5
29.1
-5.7
3.7
17.8
2.0
-1.2
59.1
-0.9
-9.6
16.0
420.8
379.5
365.7
425.8
319.0
475.4
375.9
322.2
518.9
418.4
221.6
208.1
148.8
366.1
208.3
132.3
194.3
177.6
188.4
348.0
166.4
364.8
202.1
154.7
246.5
172.1
177.3
313.3
319.1
137.9
271.9
112.1
63.9
204.7
210.6
188.9
241.6
134.2
100.1
52.3
148.2
197.1
166.0
241.2
89.5
172.1
109.0
67.7
271.5
120.1
375.5
407.1
411.1
348.4
438.1
281.5
375.9
393.8
184.0
278.9
471.0
475.1
521.6
299.5
442.6
469.0
403.9
414.3
392.2
210.7
370.4
141.4
303.2
344.3
246.5
319.7
311.4
174.2
154.7
321.8
173.1
319.1
361.8
219.9
210.6
230.9
172.9
267.6
304.7
341.9
236.7
185.7
209.3
123.8
274.6
191.7
254.3
288.7
84.2
235.3
158.3
114.6
59.8
47.2
39.3
6.1
125.4
107.1
86.2
196.9
29.2
183.2
193.7
65.3
74.8
43.0
28.1
18.3
105.0
93.8
40.3
0.7
63.4
45.9
113.3
16.3
28.0
15.4
0.6
2.2
0.9
11.7
0.7
13.5
183.6
18.6
41.3
0.6
8.9
91.0
60.5
2.0
64.7
47.3
4.4
0.0
3.6
16.7
6.7
23.8
Total U.S. ad spending(US$ millions)
158
51
57
70
50
49
40
61
62
36
63
60
69
44
53
77
67
64
66
68
74
71
171
102
75
89
73
79
72
94
81
97
83
85
103
84
90
86
82
76
118
87
96
110
99
93
152
98
88
112
Estim
atedunm
easured(U
S$ m
illions)
Head
quarters
Ad
vertiser
2006
2006
2007
2007
% chang
e
Measured
med
ia(U
S$ m
illions)
Mag
azines
6.8
86.7
12.1
1.0
87.5
5.3
13.6
18.3
1.4
3.2
79.6
3.5
31.4
31.8
5.0
67.3
124.6
67.4
21.7
10.2
18.9
64.4
0.9
57.9
1.8
0.7
9.6
3.5
18.1
1.0
53.7
15.3
2.3
5.1
0.0
1.4
3.9
107.1
0.6
15.9
30.5
1.2
14.4
2.3
0.5
37.5
68.5
28.8
15.0
89.4
New
spap
er
1.0
0.1
27.4
0.1
0.8
0.5
0.0
1.4
3.9
0.1
18.0
0.7
0.2
0.1
2.6
0.0
0.8
0.0
3.6
6.3
12.0
8.7
0.1
1.5
0.1
23.3
4.3
3.9
5.3
4.9
9.7
21.5
4.8
0.2
0.3
13.6
17.4
0.0
4.4
11.9
1.2
25.8
0.0
0.0
7.0
4.6
1.3
0.6
7.3
0.1
Outd
oo
r201.4
116.1
255.4
291.2
266.6
181.9
212.2
241.3
83.3
55.6
191.1
262.1
278.0
175.4
343.0
357.2
181.1
320.8
222.7
74.2
236.6
32.3
228.8
94.4
122.4
236.4
227.8
48.8
37.4
259.4
55.6
213.9
324.8
197.9
25.2
174.5
73.0
109.8
261.6
195.9
133.1
140.6
119.0
49.5
206.6
135.7
164.0
228.9
17.7
95.8
TV
0.2
2.1
26.3
3.2
29.6
8.1
0.3
8.6
0.7
2.0
102.0
8.5
12.9
14.3
7.3
0.4
5.7
4.2
18.4
1.6
49.3
34.7
2.2
1.8
0.2
10.7
23.1
7.0
92.1
10.2
23.9
15.5
25.5
1.1
0.9
19.1
7.9
2.2
20.6
17.1
7.4
13.7
3.4
5.1
54.6
4.3
9.8
10.7
19.4
18.3
Rad
io
7.8
87.5
30.1
5.7
14.4
79.6
24.5
17.1
8.5
21.3
51.1
17.1
5.4
12.6
9.9
1.0
63.6
3.5
20.7
24.5
13.3
0.7
7.8
142.8
8.7
32.4
18.6
95.6
1.1
44.0
29.3
41.2
3.8
2.2
0.7
3.7
29.4
47.9
8.6
10.2
4.1
2.3
7.9
19.6
1.4
9.6
7.0
3.1
18.1
7.9
InternetU.S. measured media breakout
for 2007 (US$ millions)
Top 100 Global Advertisers in U.S., by Medium
VOLUME 8 REPORT N 2 BUILDING RELATIONSHIPS WITH ADVERTISING
AGENCIES
17
-
agencies to be more integrated physically andduring the
media-buying process.
The top advertising agency capitals are Tokyo,New York, Paris
and London. Advertising Age,the leading advertising agency trade
magazinebased in New York, tracks the top global andU.S. agencies,
and U.S. advertisers each year.Japans Dentsu is the top global
agency, withUS$2.17 billion in revenue in 2007, whileBBDO Worldwide
and McCann EricksonWorldwide, took second and third
place,respectively.
Meanwhile, WPP Group is the top globalmedia buying agency, with
almost $2.1 billionin revenues in 2007, followed by OmnicomGroup in
New York and Publicis Groupe inParis.
Advertising Age also tracks the top globaladvertisers in the
United States each year, ledby Procter & Gamble, AT&T and
VerizonCommunications with overall advertisingspend. The top
advertisers tend to fall in a fewindustries: consumer
products,pharmaceuticals, telecoms, auto companiesand
entertainment/media conglomerates.
The top global advertisers in the United States,spending more
than $100 million onnewspaper advertising in 2007, were:
telecomsAT&T, Verizon, Deutsche Telecom and Sprint;consumer
products companies Procter &
Gamble and Unilever; car manufacturersGeneral Motors, Ford and
Chrysler;entertainment and media conglomerates TimeWarner, Viacom,
News Corp., Walt Disney,Sony and General Electric; department
storesSears, JCPenney, Kohls, Target and Macys;electronics
retailers Best Buy and Circuit City;and computer manufacturer Dell.
The topnewspaper advertisers in the United Statesincluded three
mobile phone operators(Verizon, Sprint and AT&T), three
retailers(Macys, Frys and Sears), three mediaconglomerates (Time
Warner, General Electricand Walt Disney) and one consumer
goodsmanufacturer (Procter & Gamble).The top 10 U.S.
advertisers for Internet displayare comprised of one telecom
(Verizon); twocar manufacturers (Ford and General Motors);five
Internet commerce and investmentcompanies (IAC, Apollo, E-Trade,
Fidelity andScott Trade); one consumer data company(Experian) and
one technology company(Microsoft).
Advertising Expenditure Advertising agencies worldwide control
thevast majority of advertising expenditureworldwide. Over the
years, advertising spendcontinues to go up, but for many
traditionalmedia outlets, does not keep up with inflation.
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
18
Global Advertising Market: Internet vs. Mobile
Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen Associates
World Association of Newspapers 2008-2009
12,42017,404
24,778
35,734
46,843
58,809
70,733
82,324
93,461
103,958
148 339 703 1,427 2,6484,382 6,418
9,165 12,77416,407
27.9
40.1 42.444.2
31.125.5
20.316.4 13.5 11.2
129.1
107.4103.0
85.6
65.5
46.542.8
39.4
28.4
0
20,000
40,000
60,000
80,000
100,000
120,000
2003 2004 2005 2006 2007p 2008 2009 2010 2011 20120
20
40
60
80
100
120
140US$ millions%
Internet Advertising (US$ millions)
Mobile Advertising (US$ millions)
% Change
% Change
2008-12CAGR
17.3
44.0
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
18
-
Further, the market share for ad spend ontraditional media,
including newspapers,continues to slip around the
globe.PricewaterhouseCoopers tracks and projectsadvertising spend
across the globe, andprojects a dramatic climb in market share
byInternet advertising.
From 2009 to 2012, Internet advertising ispredicted to grow from
14.6 percent to19 percent of the ad market. While
traditionaladvertising spend is growing in single-digits oreven
declining, Internet and mobile advertisingis predicted to grow in
the double digits duringthe same period. Meanwhile, TV and
VOLUME 8 REPORT N 2 BUILDING RELATIONSHIPS WITH ADVERTISING
AGENCIES
19
2003
29.4
4.7
2.8 2.5 2.3 5.6 2.4 -1.0 3.6
2005
43.6
3.4486.7 4.8 3.9 2.2 6.1 3.0 7.0 5.2
2006
45.8
6.4286.4 3.9 2.7 2.6 8.1 1.9 4.6 6.6
2007p
33.2
3.753.5 3.3 -0.2 -1.1 6.9 2.0 2.1 4.4
2008
27.7
8.630.9 4.3 0.5 -1.2 7.0 0.7 -0.4 6.3
2009
22.1
3.024.4 4.4 2.1 0.9 6.9 0.7 3.0 4.9
2010
18.6
7.313.6 5.6 4.0 2.5 6.9 1.8 5.0 7.0
2011
16.1
3.0 8.6 5.4 4.1 3.0 6.7 2.2 6.1 5.4
2012
13.3
7.5 7.8 5.9 4.2 3.8 6.4 2.5 7.5 6.8
2008-12CAGR19.5
5.916.7 5.1 2.9 1.8 6.8 1.6 4.2 6.1
2004
41.2
10.9
5.8 5.0 4.5 7.9 2.5 2.9 8.1
US$ million
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
% annual change Internet Advertising: Wired and Mobile
Television Video Games Consumer Magazines Newspapers Radio
Out-of-Home Directories Trade MagazinesTotal
Global Advertising by Segment, 2003-2012
Note: Newspaper, consumer magazine and trade magazine Web site
and mobile advertising is included in their respective segments and
in the Internet advertising segment, but only once in the overall
total.Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen
Associates World Association of Newspapers 2008-2009
373,406
472,569
563,449
373,406403,487424,451
452,625472,569
502,000526,734
563,449593,789
633,909
0
5
10
15
20
25
30
35
40
2003 2006 2009 2012
Internet Advertising: Wired and Mobile
Television
Video Games
Consumer Magazines
Newspapers
Radio
Out-of-Home
Directories
Trade Magazines
Share of Global Advertising by Segment
Sources: PricewaterhouseCoopers LLP. Wilkofsky Gruen Associates
World Association of Newspapers 2008-2009
%
3.4
8.214.6
19
34.434.6 34.5
34
0.2 0.3 0.4
8.2
5.5
8.2 7.8
5.66.9
4.5
7.8 7.5 7.4
28.3 26.2
232321.6
5.5 5.6 5.96.1
45.9
67.7 6.9 6.15.45.4
4.7 4.5 4 4
VOLUME 8 REPORT N 2 BUILDING RELATIONSHIPS WITH ADVERTISING
AGENCIES
19
-
newspaper ad spend, previously the No. 1 andNo. 2 advertising
mediums according to PwC,will decline from 34.5 to 34, and 23 to
21.6,respectively, from 2009 to 2012.
When breaking down ad spend in regions of
the world, the strongest growth for newspaperadvertising spend
is in Latin America, which isexpected to grow 7.8 percent from 2008
to2012, and will remain as the No. 2 advertisingmedium after
television for the foreseeablefuture, according to PwC.
Asia Advertising by Segment, 2003-2012
Note: Newspaper, consumer magazine and trade magazine Web site
and mobile advertising is included in their respective segments and
in the Internet advertising segment, but only once in the overall
total.Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen
Associates World Association of Newspapers 2008-2009
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
2003
49.9
5.8
4.1 4.5 2.9 6.4 6.1 -0.2 5.9
2005
59.6
4.0
4.3 4.9 3.9 2.2 4.9 7.6 6.0
2006
41.2
4.1400.0 2.1 5.7 7.2 6.4 0.1 3.5 6.3
2007p
39.5
4.540.0 0.6 6.3 2.8 5.4 5.9 1.2 7.1
2008
39.5
9.932.1 4.5 7.5 6.4 9.1 4.0 4.610.8
2009
27.0
3.021.6 3.1 4.2 3.0 7.2 4.0 3.2 6.4
2010
20.1
6.411.1 4.3 6.7 4.8 7.0 4.0 4.1 8.0
2011
16.9
4.810.0 4.2 6.0 4.8 6.6 3.9 4.8 6.9
2012
14.4
6.0 9.1 4.8 5.6 4.7 6.4 3.8 4.4 7.0
2008-12CAGR23.3
6.016.5 4.2 6.0 4.7 7.2 4.0 4.2 7.8
2004
57.6
8.1
5.1 5.6 5.211.6 5.7 1.5 8.4
US$ million
% annual change Internet Advertising: Wired and Mobile
Television Video Games Consumer Magazines Newspapers Radio
Out-of-Home Directories Trade MagazinesTotal
69,93275,777 80,311
85,40091,43491,434
101,298107,749
116,362124,399
133,105
Share of Asia Pacific Advertising by Segment
Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen Associates
World Association of Newspapers 2008-2009
%
0
5
10
15
20
25
30
35
40
45
2003 2006 2009 2012
1.8 1.7 1.5 1.4
5.7 5.1 4.79.3
4.6 4.1 3.8
29.4 28.2
5.9
0 0.1 0.2 0.2
7.3
1.7 1.5 1.4
6.26.55.7 5.1 4.7
9.8 9.7 9.59.3
4.84.6 4.1 3.8
29.4 28.226.6
25.7
5.9
0 0.1 0.2 0.2
39 37.435
33.5
2.5
7.3
14.318.6
Internet Advertising: Wired and Mobile
Television
Video Games
Consumer Magazines
Newspapers
Radio
Out-of-Home
Directories
Trade Magazines
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
20
-
Comparatively, advertising spend for otherregions is projected
to grow from 2008 to2012, including Europe, the Middle East
andAfrica (EMEA), 4.3 percent; Asia, 6 percent;Canada, 2.1 percent;
and the United States,declining by 0.8 percent.
During the same period, the Internet advertisingmarket share
will rise dramatically in allregions, while market share for
newspaper adspend will decline for newspapers worldwide,PwC has
forecast. In Asia, it is expected todecline from 26.6 percent to
25.7 percent;
% annual change Internet Advertising: Wired and Mobile
Television Video Games Consumer Magazines Newspapers Radio
Out-of-Home Directories Trade MagazinesTotal
2003
40.3
4.8
1.0 -1.3 7.0 5.2 2.9 -3.8 2.7
2005
59.2
6.0
3.3 4.7 5.5 7.7 3.2 1.8 6.5
2006
63.2
6.5400.0 5.0 4.2 5.5 9.3 3.0 5.4 8.4
2007p
38.0
6.350.0 2.1 4.0 5.4 7.9 0.7 3.0 7.2
2008
30.1
7.433.3 4.4 4.2 5.0 7.1 0.2 4.7 7.7
2009
24.9
6.722.5 4.4 4.6 4.9 6.7 1.0 5.7 7.5
2010
21.5
8.116.3 5.1 4.5 4.7 6.3 2.0 5.5 7.9
2011
18.9
5.111.4 4.7 4.2 4.2 5.7 2.6 5.7 6.7
2012
15.7
6.210.2 4.8 4.0 3.7 5.3 3.1 5.4 6.7
2008-12CAGR22.1
6.718.5 4.7 4.3 4.5 6.2 1.8 5.4 7.3
2004
49.4
10.5
4.5 5.1 9.4 5.8 2.9 1.7 7.8
US$ million
115,340124,331
132,422143,496 153,880
165,727178,166
192,247205,202
218,865
EMEA Advertising by Segment, 2003-2012
Note: Newspaper, consumer magazine and trade magazine Web site
and mobile advertising is included in their respective segments and
in the Internet advertising segment, but only once in the overall
total.Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen
Associates World Association of Newspapers 2008-2009
0
50,000
100,000
150,000
200,000
250,000
Share of EMEA Advertising by Segment
Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen Associates
World Association of Newspapers 2008-2009
%
0
5
10
15
20
25
30
35
2003 2006 2009 2012
4.7 4.3 4.1
7.15.8 5.16.76.7 6.4
5.4 5.3 4.9 4.5
10.5 9.48.9
0 0.1 0.3 0.3
8.6
15.5
4.7 4.3 4.1
8.1 7.15.8 5.16.7 6.76.7 6.4
5.4 5.3 4.9 4.5
29.9 27.625.2
23.2
11.5 10.5 9.48.9
0 0.1 0.3 0.3
30.3 30.4 29.829.3
2.8
8.6
15.5
21.1
Internet Advertising: Wired and Mobile
Television
Video Games
Consumer Magazines
Newspapers
Radio
Out-of-Home
Directories
Trade Magazines
VOLUME 8 REPORT N 2 BUILDING RELATIONSHIPS WITH ADVERTISING
AGENCIES
21
-
EMEA share will decline from 25.2 to 23.2percent; Latin America
will decline from 20.2to 19.4 percent; Canadas share will
declinefrom 23.9 to 21.6 percent; and in the UnitedStates, share
will drop from 19.6 to 18 percent.
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
22
Latin America Advertising by Segment, 2003-2012
Note: Newspaper, consumer magazine and trade magazine Web site
and mobile advertising is included in their respective segments and
in the Internet advertising segment, but only once in the overall
total.Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen
Associates World Association of Newspapers 2008-2009
0
5,000
10,000
15,000
20,000
25,000
30,000
2003
4.2
7.8 6.3 2.7
-16.3 5.6 7.412.5 4.5
2005
46.9
21.116.012.315.427.717.011.518.6
2006
34.3
15.4 9.512.010.822.112.9 7.314.2
2007p
50.3
12.711.415.0 8.3 -0.912.2 9.212.9
2008
35.1
11.410.2 9.9 7.6 3.8 9.8 8.510.9
2009
28.7
6.1 9.5 8.0 7.0 4.2 8.5 7.5 7.4
2010
23.3
13.1 8.8 7.5 6.7 6.3 7.4 7.911.0
2011
23.6
4.9 8.6 7.2 6.2 8.7 6.7 7.6 6.3
2012
21.0
9.3 8.3 6.7 5.8 8.2 6.2 8.2 8.7
2008-12CAGR26.2
8.9 9.1 7.8 6.7 6.2 7.7 7.9 8.8
2004
46.5
20.111.9 7.712.416.415.210.115.8
US$ million
% annual change Internet Advertising: Wired and Mobile
Television Consumer Magazines Newspapers Radio Out-of-Home
Directories Trade MagazinesTotal
9,76111,308
13,408
19,170
13,40815,309
91,43417,29019,170
20,58222,851
24,30126,405
Share of Latin America Advertising by Segment
Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen Associates
World Association of Newspapers 2008-2009
%
2003 2006 2009 2012
0
10
20
30
40
50
60
1.5 1.5
5.2 5.0 5.0 4.71.9 2.2 1.7
6.6 6.1 5.6
23.0
19.9 20.2 19.4
7.8 7.0 7.0 7.0
52.5 56.2 55.756.3
1.93.6
5.2
1.5 1.5
5.2 5.0 5.0 4.71.9 2.2 1.7
6.6 6.1 5.6
23.0
19.9 20.2 19.4
7.8 7.0 7.0 7.0
52.5 56.2 55.756.3
1.93.6
5.2
Internet Advertising: Wired and Mobile
Television
Consumer Magazines
Newspapers
Radio
Out-of-Home
Directories
Trade Magazines
-
VOLUME 8 REPORT N 2 BUILDING RELATIONSHIPS WITH ADVERTISING
AGENCIES
23
2003
21.5
3.6
4.0 4.7 1.2 5.2 0.9 0.7 3.2
2005
30.9
0.0233.3 5.9 2.5 0.4 8.0 1.610.2 3.2
2006
35.8
6.4200.0 3.0 -0.3 0.2 8.0 1.2 4.2 4.9
2007p
27.2
0.966.7 5.0 -7.9 -5.1 7.6 1.0 1.5 0.5
2008
20.9
8.730.0 3.7 -7.7 -6.1 4.7 -0.9 -4.4 2.8
2009
17.2
0.026.9 4.5 -2.4 -1.9 7.0 -1.4 1.1 1.7
2010
15.0
6.612.1 6.3 1.2 0.4 7.4 0.4 4.7 5.3
2011
12.8
0.4 5.4 6.2 2.3 1.4 8.0 0.7 6.6 3.2
2012
10.0
9.1 5.1 7.2 3.1 3.5 8.0 1.0 9.3 6.6
2008-12CAGR15.1
4.915.4 5.6 -0.8 -0.6 7.0 -0.1 3.4 3.9
2004
33.2
11.9
7.1 4.5 2.5 6.0 0.8 3.8 7.8
US$ million
0
50,000
100,000
150,000
200,000
250,000
300,000
% annual change Internet Advertising: Wired and Mobile
Television Video Games Consumer Magazines Newspapers Radio
Out-of-Home Directories Trade MagazinesTotal
U.S. Advertising by Segment, 2003-2012
Note: Newspaper, consumer magazine and trade magazine Web site
and mobile advertising is included in their respective segments and
in the Internet advertising segment, but only once in the overall
total.Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen
Associates World Association of Newspapers 2008-2009
170,245183,502
226,851
183,502189,343 198,650
199,705 205,272208,698
219,720 226,851241,725
Share of U.S. Advertising by Segment
Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen Associates
World Association of Newspapers 2008-2009
%
0
5
10
15
20
25
30
35
40
2003 2006 2009 2012
5.7 5.8 5.5
7.26.8
3.4 3.9
9.98.3
6.77.3
0.2 0.4
34.9
8.7
5.8 5.5 5.7
7.6
5.7
8.2 7.26.8 6
3.2 3.4 3.9 4.3
11.2 9.98.3
7.5
27.1 24.8
19.6
18
6.7 6.77.3
7.6
00 0.2 0.4 0.40.4
34.3
34.936.5
36.8
4.3
8.7
14.9
18.4
Internet Advertising: Wired and Mobile
Television
Video Games
Consumer Magazines
Newspapers
Radio
Out-of-Home
Directories
Trade Magazines
-
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
24
Canada Advertising by Segment, 2003-2012
Note: Newspaper, consumer magazine and trade magazine Web site
and mobile advertising is included in their respective segments and
in the Internet advertising segment, but only once in the overall
total.Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen
Associates World Association of Newspapers 2008-2009
2003
38.4
9.0
9.4 0.7 8.3 3.9 2.6 -6.4 5.8
2005
56.3
1.7
2.8 3.9 1.213.5 2.9 1.0 4.6
2006
81.5
4.0400.0 3.6 3.3 5.4 7.5 3.8 4.3 9.0
2007p
33.2
-1.530.0 5.8 3.0 4.7 7.0 3.2 4.6 5.0
2008
27.9
3.226.9 4.7 1.0 1.2 4.9 4.7 3.5 5.6
2009
24.9
4.721.2 4.2 1.8 2.1 6.2 3.9 4.2 6.5
2010
20.3
3.616.9 4.7 2.5 3.9 6.6 3.9 5.3 6.3
2011
17.7
3.213.9 5.3 2.6 4.9 7.6 3.6 5.4 6.3
2012
15.2
3.011.3 5.4 2.8 4.5 7.9 3.5 6.2 5.9
2008-12CAGR21.1
3.617.9 4.9 2.1 3.3 6.6 3.9 4.9 6.1
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
8,128 8,5698,967
9,77010,260
10,83311,539
12,26913,036
13,809
2004
54.2
4.8
6.0 3.3 3.4 6.8 2.9 1.0 5.4
US$ million
% annual change Internet Advertising: Wired and Mobile
Television Video Games Consumer Magazines Newspapers Radio
Out-of-Home Directories Trade MagazinesTotal
Share of Canada Advertising by Segment
Sources: PricewaterhouseCoopers LLP, Wilkofsky Gruen Associates
World Association of Newspapers 2008-2009
0
5
10
15
20
25
30
35%
2003 2006 2009 2012
2.5 2.2 2.1 2.1
9.7 8.9 8.5 7.9
3.2 3.5 3.6
13.412.3 11.2 10.7
26.7
23.921.6
7.0 6.6 6.4 6.2
0.0 0.8 1.4 1.7
32.429.8
26.9
2.8
10.2
18.3
25.0
28.9
2.5 2.2 2.1 2.1
9.7 8.9 8.5 7.9
3.2 3.5 3.6 3.7
13.412.3 11.2 10.7
26.7
23.921.6
7.0 6.6 6.4 6.2
0.0 0.8 1.4 1.7
32.429.8
26.9
24.8
2.8
10.2
18.3
25.0
28.9
Internet Advertising: Wired and Mobile
Television
Video Games
Consumer Magazines
Newspapers
Radio
Out-of-Home
Directories
Trade Magazines
-
As any marriage counsellor will tell you, thereare always two
sides to every story about arelationship. In order for a
relationship towork, both parties need to feel respected
andlistened to. The relationship betweennewspapers and advertising
agencies is nodifferent. Over the decades of
relationships,communication between the two sometimesgets lost, and
needs to be revitalised.
Circa 2009, advertising agencies andnewspapers have a yin-yang
relationship.While one cant exist without the other,friction
continues to be caused by lack ofcommunication or accommodations
for avariety of needs in the negotiating, buying,publishing and
accounting processes. The SFNteam conducted a survey and
personalinterviews with agency buyers and newspaperadvertising
executives to determine how thetwo entities can forge a stronger
relationship inindividual markets around the world. Here aresome of
the findings:
If newspapers could change how they workwith agencies, they
would improve a variety offactors, including how trading works,
making
agencies aware of their value across platformsand having more
transparency about clientsand their campaign objectives.If
advertising-buying agencies could changehow they work with
newspapers, they wouldimprove a variety of process issues and
detailsof doing business, particularly regarding ratecards,
invoicing, tear sheets and thedistribution of general market
information.
If newspaper companies made it easier to buynewspaper
advertising, it likely wouldencourage media planners to buy
morenewspaper advertising, according to severalmedia planners
interviewed by the SFN team.A variety of media buyers and planners
fromadvertising agencies worldwide have assessedthe hurdles in
working with newspapers. A variety of responses are listed
heresignalling an opportunity to make changes toencourage a more
lucrative relationship withagencies.
Buying newspaper advertising iscomplicated.
2. What Agencies Want from Newspapers
VOLUME 8 REPORT N 2 BUILDING RELATIONSHIPS WITH ADVERTISING
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You cant do one-stop shopping (acrossnewspapers).There are too
many rate cards.
Invoices are frequently wrong. Contract ratesare not always in
the newspapers computersystems.
Sales reps arent always informed about ratecard prices or why
prices have inexplicablyrisen.
Newspaper advertising prices havent caughtup with declining
circulations.
Sales reps dont understand our clientsneeds.
Cross-platform audience information is good,but Im not sure how
well use it.
Newspaper usage data must be about now,not six months old.
There are a lot of choices out there for mediaplanners.
Newspapers need to become morecompetitive with new pricing and new
offers ofvalue.
Editorial rules the roost in decision makingabout whether
innovative ads will run or not.
Its hard to guarantee a position on a page.
Invoices are frequently wrong, and it takes along time to clear
up the problem.
(Newspapers) don't seem to go with the market.
In analysing the media planners opinions onnewspaper
advertising, the obviousopportunities for newspapers are:
To make buying newspapers simpler, withstreamlined, electronic
processes and thecreation of networked buys across newspapersin a
given region or country.
To create an accurate invoicing scheme withchecks and
balances.
To create fewer rate cards, and to ensure thatthe rate cards are
logged into the newspapersdatabase.
To assess advertising pricing, and to considerdynamic pricing
schemes depending on theagencys annual or monthly contract
volume.
Inform agencies in detail about cross-mediaadvertising
opportunities through fresh,detailed statistical analysis.
To train sales reps more thoroughly aboutpricing, offers and
newspaper audience reachbefore they call on advertising
agencyaccounts.
Several planners and buyers report that somenewspaper
representatives to agencies are notwell informed about their
newspapers ownpricing, value-added features or commissionsto
agencies. But it is the occasional passionatesales representative
who is both enthusiasticand well-informed who makes an impressionon
planners and buyers that pays off for hisnewspaper.Its all about
relationships between people,says Fiona Hodges, print director
forMediaedge:cia in London.The advertising and newspaper
landscapescontinue to change separately and together.Many agencies
and newspapers are workingtogether to improve relationships for the
future.Historically saying, at least in Japan, therelationship
between newspaper companiesand advertising companies is already
very,very strong. But both of us should make effortsto innovate the
newspaper industry. We couldhave a lot of to do, says Tomoaki
Ide,research director for Dentsu in Tokyo, one ofthe largest
advertising agencies in the world.Ad companies should advise more
and moreto the newspaper companies. But adcompanies hesitated to do
so. And especiallythe Japanese newspaper companies made lesseffort
than western newspapers for themselvesbecause they could grow their
business with adcompanies without much effort. They weredependent
on ad companies to get ad revenueand did very little to innovate
their own mediaitself with some Japanese ways of thinking. Idont
want to deny the whole because Japanesecan have the Japanese own
style. But at thesame time, we know that they have a lot ofthings
to do to be stronger.While many planners and buyers suggestchanges
should be made, there also is muchthat is right about the working
relationshipbetween newspapers and agencies: Newspapers can quickly
amass a wide reachin a community Local reach and targeted reach are
easilyattained Value added features like Post-it notes,polybags,
cross-media campaigns all arepositive differentiators
JANUARY 2009 SHAPING THE FUTURE OF THE NEWSPAPER
26
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Excellent research has been done aboutnewspaper consumers about
usage patterns andlifestyles that are valuable in the
planningprocess Online newspaper reach is accountable andtargetable
Builds high reach quickly Production costs are low compared with
TV,radio and Internet Colour can create impact Credible environment
Can offer direct response with coupons
The SFN team interviewed a variety ofadvertising agency planners
and buyers. Thefollowing are excerpts from those interviews:
Starcom MediaVest GroupInterview with Kathy Heatley, vice
president, director of localinvestment, locatedin Detroit,
Michigan, United States
Global Chicago, Illinois, headquarters United States
Parent company Subsidiary of Paris-basedPublicis Groupe
Web site www.smvgroup.com
Starcom MediaVest Group is one of the largestmedia,
communications and event planningand buying groups in the world,
with 5,800employees working in 110 offices in 67countries. The
group works with some of theworld's top brands, such as
Coca-Cola,General Motors and the Walt DisneyCompany.
Kathy Heatley works out of SMG's office inDetroit, the home of
the U.S. auto industry,and works in the newspaper category
withbrands in automotive, financial,telecommunications, packaged
goods,electronics and retail sectors. She says shebelieves in the
future strength of bothadvertising agencies we're strong andglobal
and newspapers newspaper is thenew black. It's ripe for invention.
It's going tobe around for a really, really long time it'sjust
changing.From a buyer's perspective, Heatley, vicepresident and
director of local investment, saysshe thinks the overall media
buying landscape inthe United States is flexible, and the
newspaperbuying landscape is very flexible right now,and a little
scary, because there's definitely
concern about who's going to be in businessand who are they
going to be owned by.
In terms of advertising, this means the biggesthurdle newspapers
have faced in the past fiveyears has had more to do with their own
badpress than anything else, she said. The badpress surrounding the
financial and businessstate of the newspaper industry, exacerbated
bythe global economic downturn as 2008progressed, has caused
advertisers to be morewary of the industry, Heatley says.
Clients believe it and it hurts them, she says,adding that
newspapers need to be their ownbiggest advocates, and market
themselves toadvertisers. Stay connected to the localmarket that's
where expertise and strength is.I think (newspapers) also need to
continue tolook for multimedia partners in their localmarkets, she
advises.
Newspapers, which have great content, are ripefor building
multimedia packages foradvertising customers, which is exactly
whatthey want, she says.
In the future, Heatley says pricing digitaladvertising on a cost
per thousand basis, andbased on an audience measure, seems the
mostreasonable. Pricing based on cost per inch,colour or premiums
is nonsense, and doesnothing to sell actual audience, she says.
We should be buying audience. They make ittoo complicated, which
is another reasonpeople don't like to buy them. In the future,
itwould help if agencies and publishers couldpartner to figure out
the best new ways tomeasure all platforms, then chargeappropriately
for what the publisher can offer,and what the advertiser is getting
in return, shesays. Newspapers need to recognise wedon't have a
problem talking about readership,but you also have to come with the
digitalcosts, and equalisation. Finding a way toreport on
circulation by issue date would alsohelp, she adds.
Heatley says buying newspaper advertisingcould be smoother when
it comes to:
Responsiveness: Some newspapers don'trespond, others do. Also,
staff cuts and staffinglevels going down have also really
affectedresponsiveness.
Rates: Newspapers are considered veryexpensive, she says.
Although newspapers
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seem to have improved in terms ofreproductive quality, rates are
all over theboard ... they preach integrity of rates to keeprates
high, (but) the market should drivethose rates, Heatley says. If
you're in a softadvertising market, you need to make a deal.If
you're not, keep your rates high, and wecan decide if it's a right
rate. (Newspapers)don't seem to go with the market. Theadvertising
market will be soft next year, butnewspapers will come up with rate
increases it's crazy. They feed their sales people tothe
wolves.
Look at clients individually: I think theyneed to look at each
individual client on anindividual basis. One of the things I hear
isthat they have to treat you the way they treateveryone else. I
don't think so if anothercustomer doesn't have good buyers,
weshouldn't suffer. They need to be flexible andprovide value.
Tear sheets, which seem like a small thing, canbe a huge
headache. Heatley says that for a smoother process, everyone should
use the e-tear system, but not all newspapers do.
There