Contract publishing is attracting a fresh set of categories, beyond
the usual suspects in travel and banking. Mounting pressure to achieve
cut-through, and a belief that consumers are filtering out advertising
are driving growth for this once overlooked marketing tool.
Clutter is one of the biggest challenges marketers face. As new types of
media proliferate, it doesn't matter how creative your advertising,
direct marketing or sales promotion may be - the number of people who
simply ignore it is growing.
The challenge is to persuade people that they want to absorb your
marketing messages. One way to do that is to surround them with content
that people actually want to read. It's achieving this cut-through is
which is driving the popularity of customer magazines.
Custom or contract publishing - the business of creating an editorial
product, rather than just a brochure, and sending it to customers,
business partners, or whoever - is a small but rapidly growing industry
in Asia.
Although custom magazines may seem like a fairly roundabout way of
talking to potential customers, they can be very persuasive.
The results from around the world speak for themselves. In the US,
research by Continental Airlines among the 380,000 circulation of its
114-page magazine found that 71 per cent of them said they found the
information in it helpful; 53 per cent said they read it every flight;
37 per cent said they kept pages for future reference; and 23 per cent
said they responded to ads in it. When you add in the fact that
Continental also makes US$4.5 million a year in advertising
revenue from the magazine, it's a pretty powerful tool.
Beyond the usual suspects in areas like air travel and financial
services, companies in Asia have been wary of custom publishing until
now. "There's definitely a strong demand for it," says Fjelddahl,
managing director of marketing services agency Motiv8, which has a
custom magazine division called Motiv8 Publishing, with clients
including technology and telecoms firms Lucent, PCCW and MSN. "There's a
maturity among clients, and a belief that advertising is being filtered
out by consumers. Look at the whole debate on the internet with pop-up
windows and other ways of interrupting people - that's how far the
debate has gone. But that's absolutely the opposite of what you should
be doing - you should be making people want to reach out and learn
more," says Fjelddahl.
Contract magazines come in various shapes and sizes, and can be aimed at
a number of different audiences. The best-known are those produced by
consumer companies such as credit card firms and airlines. Retail has
also emerged as a strong growth area for custom publishers, says Jim
Marett, Asia-Pacific director of Redwood, which prints 122 million
magazines in 11 languages globally.
But the fastest-growing area is business-to-business custom publishing,
with magazines aimed at a company's clients, prospects, and other
business partners. Then there are custom-published products aimed at
staff and at investors.
Roberto De Vido, managing director in Asia of Appleberg Publishing, a
Swedish custom publishing firm, said business-to-business is where the
real action is. "Those companies understand that the value of a
relationship is much greater. Businesses are less fickle than
consumers.
"Not everyone is cut out to be our customer. We're suited to
organisations that have a relatively complicated message, and need a
longer duration of customer mindshare. Someone like Coke doesn't need a
customer magazine." Appleberg's clients include American Express, Merck,
the Hong Kong Tourism Board, Ericsson, ABN Amro and Disney.
On the client side, MSN is an example of the new breed of custom
publishing converts, recently signing a deal with Motiv8 to produce a
magazine aimed at several thousand advertisers, commercial partners and
staff. MSN's regional marketing director Rose Leng believes that it will
be a powerful business-to-business tool. "There's still nothing that
beats having a copy of something that's visually impactful and sits on
someone's desk.
An actual physical product is hard to ignore. We expect this to be a
door-opener to advertisers we haven't dealt with before. If it only does
that, I'll consider it a success." As well as MSN-related news, the
magazine will also include general internet industry news, something
Leng thinks is vital if the company wants it to be read by its target
audience.
The same view is taken by Kenny Chan, vice-president of investor
relations and corporate communication at Hong Kong company Tradelink. A
partly government-backed organisation, Tradelink is charged with
introducing electronic trading to the city, as well as selling
government technology services.
The company has had a quarterly customer magazine, through Appleberg,
since 1997, when it had just a few thousand readers. It now has 53,000,
and is received by the majority of Hong Kong's big corporates and
SMEs.
Chan estimates that the magazine is about 50 per cent
Tradelink-specific, with the rest made up of general interest technology
information such as case studies and interviews with industry leaders.
"We don't want to make it just a company newsletter - more people read
it this way," he says.
He admits that it's "a very expensive exercise", but adds that it has
been a necessary expense: "When we launched it, we were promoting the
benefits of ecommerce in Hong Kong, and understanding of those benefits
was not widespread."
Chan adds that the magazine's cachet in the market can be seen in its
advertisers, citing the likes of IBM, Hewlett-Packard and Compaq. Leng
and Chan both take the view that high-quality editorial is crucial if a
customer magazine is going to be effective. Working out where to draw
the line in terms of credibility and trustworthiness is one of the
biggest challenges for suppliers and buyers of custom publishing
services.
The issue of lying should be straightforward: the principles are the
same as they are in ads or other pieces of marketing communication,
which at least ought to mean avoiding outright lies. "We believe that
magazines should be given an ethical editorial treatment, and that puts
pressure on us," says Motiv8's Fjelddahl. "The client can't ask us to
write something that isn't true. But we can choose which facts we
include."
The more slippery credibility issues are ones of tone and content
balance.
Obviously a customer magazine is going to cast the client in a good
light.
But if all it does is push products over and over again, then the client
may as well have a brochure printed.
"We've walked away from a couple of clients that basically wanted a
glorified brochure," says Fjelddahl. "Although about half of the market
believes in this, but the other half doesn't yet."
"Our biggest enemy is people who are not interested in quality," agrees
Appleberg's DeVido. "In China especially, you find so many
multinationals that have high-quality communications at a corporate
level, but not at all at a local level.
"Custom publishing in Asia is much less sophisticated. People think they
can just convert their brochures into magazines and that'll be
effective.
We preach that people should have magazines that have interest for the
reader. If a piece of direct mail doesn't interest you, you bin it. But
with a magazine, there could be stuff that's not about the company that
you find interesting, and there's a greater chance you'll read it. It's
got to be credible, or it's not worth doing.
"We try to address the issue of credibility at the outset, in the
process of creating the publication. The first question is: what does
our customer want to communicate? The second question is: how can we
make that a valuable experience for the reader? Yes, you can put in the
sales specs from the brochure, but no one's interested.
"If they're talking to us, they've got to have some understanding of how
custom publishing works. We're not interested in preaching to the
unconverted."
In the same way, client attitudes towards researching a title and
finding out what its readers want, both before launching it and after,
vary widely.
"Some clients are very methodical and say let's do it properly and spend
three or four months defining the product the readers want," says
Fjelddahl.
"But there's also the typical thing of: 'I know my audience, just do it
this way'."
Probably the most sophisticated users of custom publishing are airlines,
whose in-flight magazines are part of a bigger entertainment
package.
The biggest supplier of these in-flight services is Emphasis, which was
bought in April by sales representation network Publicitas from Time
Inc.
Clients include Cathay, China Airlines, Thai Airlines, Dragonair,
Malaysian Airlines and Korean Air, and the company works with more than
50 airlines globally. As well as producing magazines, the company
sources other forms of in-flight entertainment such as films, and sells
advertising both in the magazines and on other forms of ambient
media.
"All of the airlines are keenly aware that it's a competitive advantage
to provide top-quality entertainment rather than just an advert for the
brand," says Publicitas Asia CEO Barry Goodridge. "It's a different kind
of contract publishing. Most contract publishing tends to reduce to
trying to sell more things to the same customers. It's a bit different
when you have the customer sat there for 10 hours - you can afford to be
a bit more subtle."
The backgrounds of other custom publishing suppliers in Asia vary; some
focus on it solely, while others are from an agency background.
Motiv8 is an exception: about 50 per cent of its custom publishing
clients were existing marketing services clients. "What makes us
different is that in the first place, we're an agency - we have an
understanding of marketing objectives," says Fjelddahl.
Irrespective of their background, most suppliers work on an agency-like
structure, with the editorial and design departments analogous to the
creative department, and account servicing people talking to
clients.
Charges vary according to the usual publishing variables, such as the
size of the magazine, its circulation and its design and editorial
coverage.
Fjelddahl says Motiv8 clients pay between HK$500,000 and $5 million. Some suppliers work on a set fee, while others try and sell
advertising in the magazine to third parties, allowing the client to
recoup some or all of the cost of producing it - this most often happens
with the big airline and financial magazines. Similarly, some suppliers
will get actively involved in managing a magazine's circulation, just as
an agency would help manage a direct marketing database, while others
will leave the issue of who receives a magazine entirely up to the
client.
That custom publishing is attracting a number of blue-chip brands says
much about the strides the business has made in the last few years.
Redwood's Marett says the industry had a bad rap in the early years
because custom publishers gave content away for free and lived off the
advertising that the titles attracted.
Redwood has spent the last three years persuading clients to pay for
content, a fee that is partly defrayed by advertising. "We are in effect
an ad agency producing specific content to position and brand the client
rather than the generic stories which do little to market and brand our
clients."
Marett dubs content generation to meet specific client needs as the art
of custom publishing. The science side of it lies with the research it
encourages clients to undertake either on a per issue or quarterly basis
to track their performance.
Buyers of custom publishing services will get what they pay for.
High-quality magazines cost money to produce, and going for the cheaper
alternative might turn out to be a false economy. Similarly, while it
may be tempting for clients to treat a customer title like a glorified
brochure, ultimately it will be counter-productive because even the most
forceful and persuasive marketing messages will mean nothing if no one
reads them.
