Guy Consterdine, FIPP’s research consultant, outlines analysis from GfK on Dutch ROI plus Germany, PPA’s Magonomics and the Australian Magazine Audience Performance Predictor providing evidence on magazines’ role in mixed-media campaigns.
A new Dutch analysis of the return on investment (ROI) of advertising in each of five media has shown that the printed media proved to be the most cost-effective. Magazines achieved the highest value for money, with an ROI index of 130. Newspapers were close behind with 120. Online banner advertising scored 110, while radio achieved an index of 90. Television advertising was least cost-effective, with an index of only 60. Or to put it another way, magazines were roughly twice as cost-efficient as television.
The analysis was commissioned by the Dutch news media association, and conducted by research agency GfK.
The comparison with television is very relevant. We know that TV is usually the first choice medium for large-budget advertisers, because of TV’s power and very rapid build-up of reach; and that other media are generally fighting for the non-TV share. But the medium’s poor cost-efficiency compared with print and online does indicate that too high a proportion of the budget is being spent in TV, beyond the point where significant diminishing returns sets in. This proposition was well demonstrated by, among others, the PPA’s Magonomics research in the UK (which was Overall Winner in last year’s FIPP Research Awards).
As Magonomics argued, re-directing the excess spending in TV to other media – particularly print – would improve the overall return on the total campaign investment. Indeed, Magonomics argued that advertisers would need to spend, on average, at least twice as much in magazines as they currently do before the ROI in magazines would fall to the same level as that of TV.
An earlier GfK study in Germany showed a similar pattern to the results quoted above for The Netherlands – as did other studies elsewhere in the world, including in the USA, Sweden, Spain, UK and so on. There is clearly a common pattern globally. Typically, with the large-budget advertisers, too much of the budget is spent on TV, when a portion of that budget (yielding low marginal returns) would be better spent in complementary media.
Building the tools to prove the point
In order to analyse these mixed media campaigns it is vital to ensure that suitable data are being used in the econometric modelling through which the return on investment of each medium is being assessed. For magazines one of the most important, yet often disregarded, aspects is the delivery of advertising messages through time.
A sophisticated new method for calculating the week by week delivery of exposures within a magazine campaign is emerging from Australia, in the Magazine Audience Performance Predictor (mapp) from the Magazine Publishers of Australia (which I will write about in next month’s Insight newsletter). It promises to be a new step forward in the attempt to measure as closely as possible the link between weekly exposures to magazine ads and weekly purchases of products – and thereby magazines’ return on investment. In-depth discussion of mapp will feature in the programme of FIPP’s Research Forum in Hamburg on 16-17 June 2014.
Converting readership surveys into multi-platform surveys
Another requirement for assessing magazine media’s effectiveness is to measure print publishers’ audiences on all their digital platforms, with all the correct overlaps between platforms.
Traditional print-only readership surveys all over the world are finding it a struggle to provide audience data on publishers’ websites, digital replicas, apps, and social media, as accessed through several different types of device: desktop PCs, laptops, smartphones, tablets and e-readers. This is no easy task, not least because there are two incompatible elements. The audiences for printed magazines and newspapers are normally measured by recall and cannot in practice be measured by any kind of meter. The audiences for publishers’ digital platforms however are not well measured by recall, since so much is liable to be forgotten or is barely registered by respondents; digital media are better measured passively, by meters. As a result, incorporating both print and digital elements into the same database means either combining different surveys or building multiple data collection methods into the readership survey.
The consequence is that around the world there are a variety of different approaches but no clear technical winner, when reporting magazine and newspaper brands’ total all-platform audiences. Methods used include fusion, ascription, the creation of ‘virtual diaries’, and various other modelling approaches. There are also combinations of some of these methods. For example in the UK the National Readership Survey has used fusion as a means of adding passive-measurement website audience data, derived from meters, to NRS respondents – calling the resulting database PADD (Print And Digital Database). We are now in the process of adding smartphone and tablet audience data to the NRS sample, but for this we are choosing a form of ascription rather than fusion.
There was much debate about this problem of combining print and digital data at last October’s Print and Digital Research symposium and the situation is sure to continue evolving.
The digital disruption that is rapidly changing not only the media landscape but also the research landscape may not be comfortable – revolutionary change is rarely comfortable – but it certainly doesn’t lack interest. It makes for an exciting time to be working in media, and magazine media in particular – not to mention magazine media research with its fast-moving developments.