At a time when branded content is growing in importance as a marketing tool, should Asian brands be looking more seriously at launching their own magazines? Branded content in the region has often been used as a shorthand for advertiser-funded video, both on TV and online. However, in many Western markets,branded publishing projects are already far more widespread than costly video initiatives.
Take the UK, for example. In 2007 the customer publishing market, as the sector is known, was worth £904 million (US$1.47 billion), including £473 million in turnover for its agencies. Seven of the top 10 magazines by circulation are titles produced by brands, with pay-TV firms and supermarkets leading the charge.
So what do brands getting into the medium need to know? Two issues are how to fund a magazine and how to distribute it. The question of funding revolves around selling ads in a title; in effect, whether a brand should see a magazine as a pure marketing vehicle or as a media property allowing them to make money or at least offset costs.
In the West, organisations such as the Association of Publishing Agencies (APA) in the UK and Custom Content Council in the US (recently renamed from the Custom Publishing Council to reflect the importance of online media) encourage brands to see their magazines principally as a marketing tool, with ad sales only an option when the ads would be genuinely relevant to the target audience.
However, some sectors have made an ad sales model work. One is retail (especially food retail), and powerful retail groups have been known to strong-arm their suppliers into buying ads in the company’s magazines. In particular, the publication for supermarket chain Sainsbury’s in the UK generates a profit for both the brand and the publisher.
The other is in-flight media, a specialist sector of customer publishing that, because of the size and captive nature of its audience,has become a major ad sales vehicle: publishers often have to guarantee revenues to win business. Certain brands, such as Malaysian budget carrier AirAsia, have even taken publication of their in-flight magazines in-house. Travel3Sixty aims to include passenger-generated content while offering advertisers an audience of around 700,000.
Julie Sherborn, CEO for Asia-Pacific at ACP, complains that clients in Asia still want to see magazines as a revenue-generator, and at a time when ad revenues are in decline that can cause problems.“People still see it as a way to generate ad revenue, but they should be looking at it as a way of driving brand loyalty and deepening relationships,” she says.“The main issues are that with ad rates being forced down, there is limited investment in content,with the result that it becomes less engaging.Then you end up in a vicious circle.”
Most brands, then, should expect to see a customer magazine as an investment rather than a source of revenue, with ad sales as a bonus. Bjorn Fjelddahl, managing director at Eight Partnership, a publisher of custom media based in Hong Kong, even says that Eight does not pitch for business where advertising is expected to cover costs.That said, one agency source in Australia complains that in the rush to secure new business, the “do the mag for free, keep the ad revenue” approach is taking hold in that market beyond in-flight publications, with a negative effect on agencies’ margins.
Distribution also poses a problem for brands in Asia. The two principal means of getting a magazine into a customer’s hands are through a brand’s own distribution channel (usually in-store) or through the mail. Indeed, the customer publishing industry has made great gains in the US and UK by presenting a magazine as a more effective mailshot. However, the postal option requires good customer data, still a rarity in Asia,and a sound postal service, which can be a challenge in some emerging markets.
Increasingly, however, brands may want to look at electronic publishing and distribution. The rise of online has opened the door to web publishing, an option that strips out printing and mailing costs, and customer publishers in the West have been on the lookout for digital talent to meet demand.
Take the UK, for example. In 2007 the customer publishing market, as the sector is known, was worth £904 million (US$1.47 billion), including £473 million in turnover for its agencies. Seven of the top 10 magazines by circulation are titles produced by brands, with pay-TV firms and supermarkets leading the charge.
So what do brands getting into the medium need to know? Two issues are how to fund a magazine and how to distribute it. The question of funding revolves around selling ads in a title; in effect, whether a brand should see a magazine as a pure marketing vehicle or as a media property allowing them to make money or at least offset costs.
In the West, organisations such as the Association of Publishing Agencies (APA) in the UK and Custom Content Council in the US (recently renamed from the Custom Publishing Council to reflect the importance of online media) encourage brands to see their magazines principally as a marketing tool, with ad sales only an option when the ads would be genuinely relevant to the target audience.
However, some sectors have made an ad sales model work. One is retail (especially food retail), and powerful retail groups have been known to strong-arm their suppliers into buying ads in the company’s magazines. In particular, the publication for supermarket chain Sainsbury’s in the UK generates a profit for both the brand and the publisher.
The other is in-flight media, a specialist sector of customer publishing that, because of the size and captive nature of its audience,has become a major ad sales vehicle: publishers often have to guarantee revenues to win business. Certain brands, such as Malaysian budget carrier AirAsia, have even taken publication of their in-flight magazines in-house. Travel3Sixty aims to include passenger-generated content while offering advertisers an audience of around 700,000.
Julie Sherborn, CEO for Asia-Pacific at ACP, complains that clients in Asia still want to see magazines as a revenue-generator, and at a time when ad revenues are in decline that can cause problems.“People still see it as a way to generate ad revenue, but they should be looking at it as a way of driving brand loyalty and deepening relationships,” she says.“The main issues are that with ad rates being forced down, there is limited investment in content,with the result that it becomes less engaging.Then you end up in a vicious circle.”
Most brands, then, should expect to see a customer magazine as an investment rather than a source of revenue, with ad sales as a bonus. Bjorn Fjelddahl, managing director at Eight Partnership, a publisher of custom media based in Hong Kong, even says that Eight does not pitch for business where advertising is expected to cover costs.That said, one agency source in Australia complains that in the rush to secure new business, the “do the mag for free, keep the ad revenue” approach is taking hold in that market beyond in-flight publications, with a negative effect on agencies’ margins.
Distribution also poses a problem for brands in Asia. The two principal means of getting a magazine into a customer’s hands are through a brand’s own distribution channel (usually in-store) or through the mail. Indeed, the customer publishing industry has made great gains in the US and UK by presenting a magazine as a more effective mailshot. However, the postal option requires good customer data, still a rarity in Asia,and a sound postal service, which can be a challenge in some emerging markets.
Increasingly, however, brands may want to look at electronic publishing and distribution. The rise of online has opened the door to web publishing, an option that strips out printing and mailing costs, and customer publishers in the West have been on the lookout for digital talent to meet demand.
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