Tuesday, November 20, 2007

Ads Keep Spreading, but Are Consumers Immune?

Ads Keep Spreading, but Are Consumers Immune?
Advertiser Encroachment on All Forms of Media May Well Wind Up Backfiring
By Brian Steinberg

People who live near train lines find ways to adjust to the noise outside their windows. The first time a train passes, they can't help but notice it. But by the 10th or 20th time, they've figured out how to ignore it. Consumers have begun to treat encroaching advertising just like those trains.

Ads surface on the bottom third of the TV screen while a program airs, break up the flow of articles in a newspaper or stick out of the binding of a magazine. This constant knock-knock-knock against the collective consumer noggin once spurred cries of protest. No longer. "The tolerance bar has gone way up," said Dorian Sweet, executive creative director at Omnicom Group's Tribal DDB.

No safe haven

In part, that's due to people growing accustomed to constant interruption online. Thanks to the web, "consumers are becoming more desensitized," said John Moore, senior VP-director of ideas and innovation at Interpublic Group's Mullen. "They almost expect no place to be sacrosanct anymore."

Consumers may be resigned to this constant barrage, but is it just training them to tune out ad messages? Online, publishers and advertisers can mix content and commercialism as they like because, ultimately, surfers can click elsewhere. On TV and in print, that isn't always the case, particularly as ads are laced further into the content people want to enjoy.

TV screens have long been filled with egregious promos for other shows on the same network, but new techniques take the concept further. During a recent "Heroes" episode, NBC unfurled a "banner" promotion at the bottom of the screen -- in the middle of a scene -- for the film "American Gangster," something that does not run on its own air. Sibling cable outlet Bravo is gearing up to test an L-shaped bar onscreen that could be used to deliver ad messages.

CW's "Gossip Girl" recently featured the Verizon Wireless logo rising up from the bottom of the screen. Time Warner's TBS has run an on-screen bar mentioning Chrysler during "House of Payne." Viacom plans to place what it calls "commercial squeezes" at the bottom of screens on some MTV Networks channels, the company revealed in a recent investor conference call.

The new norm

Print, too, is looking crowded. Magazine bindings are jammed with discs, heavy-paper displays known as "spectaculars" and foldouts that play music. More newspapers are dressing their front pages and section fronts with advertising. Others allow characters from "Bee Movie" to show up in their arts listings. These ads "are becoming the norm," said Roger Black, a designer who has helped revamp the look of many popular magazines. Publishers once known for their buttoned-down demeanor "will allow things they didn't use to allow." Just last week, The New Yorker ran a two-page spread for Lexus that pictured its new hybrid car scattering leaves as it drove by. The ad then continued throughout the issue in the form of a slew of fake leaves stuck over cartoons by New Yorker artists created specifically for Lexus.

A look at any Facebook home page gives an indication of where media design is headed. Ostensibly filled with individual "news feed" bulletins about how friends are passing their time, the pages also contain a banner ad and promotions in the feed itself. On some news websites, everything is sponsored -- from web searches to formatting a page for printing -- with promotions just inches from editorial content. Online-video sites YouTube and Hulu are making use of clickable "overlay" ads that appear briefly at the bottom of a selection.

That design is spreading to mainstream venues. TV has become more interactive, so couch potatoes are growing accustomed to onscreen menus. Magazines are embracing the notion of surrounding a main feature with tidbits tucked away in the margins.

Taking it all in

"The way people behave in their use of media has changed. They are used to having a lot more stuff" in front of them, said Jan Leth, vice chairman of global digital creative at WPP Group's Ogilvy. More consumers are used to multitasking" and seeing multiple messages or pieces of entertainment at any given moment.

But squeezing more ads into a finite space is bound to have repercussions. "It's distracting. It's frustrating, and you feel helpless," said Robert Weissman, managing director of Commercial Alert, a nonprofit that monitors advertising's ongoing creep. Stuffing irrelevant promotion into a treasured piece of entertainment can also render the content less entertaining.

One other pitfall: Consumers are bound to grow resistant to marketing's new strain. "It's like noise on the streets of Manhattan," Mr. Black said. "You just get used to it, in which case you just have to make it noisier."

Troubling Case of Readers' Block

Troubling Case of Readers' Block
Citing Decline Among Older Kids, NEA Report Warns of Dire Effects
By Bob Thompson
Washington Post Staff Writer

Americans are reading less and their reading proficiency is declining at troubling rates, according to a report that the National Endowment for the Arts will issue today. The trend is particularly strong among older teens and young adults, and if it is not reversed, the NEA report suggests, it will have a profound negative effect on the nation's economic and civic future.

"This is really alarming data," said NEA Chairman Dana Gioia. "Luckily, we still have an opportunity to address it, but if we wait 10, 20 years, I think it may be too late."

Titled "To Read or Not to Read," the report is a significant expansion of the NEA's widely cited 2004 study, "Reading at Risk." The NEA based that earlier study exclusively on data from its own arts surveys, and as a result, that analysis focused mainly on so-called literary reading -- novels, stories, plays and poems. This led some critics to downplay its implications.

The new report assembles much more data, drawing on large-scale studies done by other government agencies (such as the Department of Education) and by non-government organizations. These studies tend to use broader definitions of reading, said Sunil Iyengar, the NEA's director of research and analysis, with many looking at "all kinds of reading," a category that includes reading done online.

The story the numbers tell, Gioia said, can be summed up in about four sentences:

"We are doing a better job of teaching kids to read in elementary school. But once they enter adolescence, they fall victim to a general culture which does not encourage or reinforce reading. Because these people then read less, they read less well. Because they read less well, they do more poorly in school, in the job market and in civic life."

Particularly striking, Gioia and Iyengar both said, are the declines that occur between age 9 and age 17 in reading proficiency scores and time spent reading.

The percentage of 9-year-olds who say they "read almost every day for fun," the NEA report notes, rose slightly, from 53 percent to 54 percent, between 1984 and 2004. During roughly the same time period, average reading scores for 9-year-olds rose sharply. But the percentage of 17-year-olds reading almost every day for fun dropped from 31 percent in 1984 to 22 percent in 2004, with average reading scores showing steady declines.

Iyengar emphasized that the NEA's data can show correlations but cannot prove a causal relationship between reading decline and, say, the proliferation of electronic media. Asked what he personally made of the late-teenage numbers, however, he offered a scenario likely to sound familiar to parents and educators.

"When you hit adolescence," Iyengar said, "there's generally less parental control." Peer pressure gets much stronger, and the culture offers "numerous distractions away from reading."

The NEA reports that in 2006, 15-to-24-year-olds spent just 7 to 10 minutes a day voluntarily reading anything at all. It also notes that between 1992 and 2003, the percentage of college graduates who tested as "proficient in reading prose" declined from 40 percent to 31 percent.

In addition to presenting data on how much and how well Americans read, Iyengar said, the NEA set out to address the "so what?" question often asked in the wake of its earlier report.

Here is some of what it found:

Thirty-eight percent of employers rate high school graduates as "deficient" in reading comprehension, while 72 percent rate them deficient in writing. Good reading skills correlate strongly with higher earnings and more job opportunities. Reading skills also correlate with increased voting, volunteerism, charity work, attendance at cultural events and even exercising and playing sports.

"This is not a study about literary reading," Gioia said. It's a study about reading of any sort and "what the consequences of doing it well or doing it badly are." In an increasingly competitive world, the consequences of doing it badly include "economic decline."

Among the NEA study's limitations is its lack of specific data about online reading, a subject on which, Gioia said, research is not yet strong.

University of Maryland English professor Matthew Kirschenbaum, whose academic interests include electronic literature, organized a forum to discuss the 2004 NEA report. That report's weakness, Kirschenbaum said in an interview last week, was that it didn't account for "the different ways in which we read."

Kirschenbaum had not seen the new report. After hearing a brief summary, however, he didn't sound inclined to change his mind. "The fact that we don't read the same way that we read 50 or 200 years ago," he said, is not necessarily "symptomatic of a general cultural decline."

Gioia disagreed.

"The Internet is the most powerful informational tool ever developed by humanity, except perhaps the phonetic alphabet," he said. "But it does not seem to nourish the sustained, linear attention" that traditional print media do.

Last Friday, Gioia and Iyengar previewed "To Read or Not to Read" for a group of perhaps 50 publishers, editors and other interested parties gathered at the Mercantile Library in New York.

"It was a sobering presentation," said Knopf publicity director Paul Bogaards, who attended with Knopf Editor in Chief Sonny Mehta. Publishers have long been aware of negative reading trends, Bogaards said, but "haven't had the data."

"The response was one of concern," said Fordham University marketing professor Albert Greco, a publishing industry expert who was also at the NEA presentation. "Maybe we should be thrilled that half of the people are still reading," Greco added, "but this is a graying market."

HarperCollins CEO Jane Friedman described herself as "skeptical but not dismissive" of the NEA's analysis.

Her company is "very much into the digital side of the business," Friedman said, and when it comes to a customer's choice of format, "I don't care. Reading is reading." She pointed to the data on young children's reading as a positive, noting that "we're seeing great growth in our children's business."

The NEA report comes without recommendations. This choice was deliberate, Gioia said, because "no one institution" can solve the reading problem alone.

"What we're trying to do is say: These are the facts. This is a framework to understand the issues. Let's talk about it," Gioia said. And the key question is: What are the consequences if America becomes "a nation in which reading is a minority activity?"

Monday, November 19, 2007

Game News in a Duel of Print and Online

Game News in a Duel of Print and Online

Noel Goodman subscribes to three video game magazines, but he wants information faster than the magazines can reach his mailbox.

"I can find out on the Internet information that won't be in magazines for another month," said Mr. Goodman, a 30-year-old electrician in Newport News, Va., who took Halloween off to play video games. The magazines, he said, are "always going to lose when it comes down to content. I can get everything online."

While video game magazine publishers beg to differ, that is precisely their challenge - retaining readers as the Internet grabs their audience and advertisers. Why wait for a monthly mailing when the Web has fresh game reviews, articles and tips on how to beat the games?

In the last few months, the two biggest publishers - Ziff Davis Media and Future US, which control most of the major game magazines in the United States - have been trying to tip the balance back in their favor.

The two companies have been bulking up their online content, trying to develop a symbiotic relationship. Their magazines offer portability and visual power, and their Web sites provide interactive features and nonstop information flow.

"If information is all that we require, the Web wins. Game over," said Simon Cox, the vice president for content at Ziff Davis Media's game group, which includes Electronic Gaming Monthly, a print magazine, and the 1UP Network, an online gaming portal. "But people want content and perspective."

To keep print subscribers, Ziff Davis aims to offer better writing and reporting than is available from competitors' Web sites, as well as striking visuals. Ziff Davis is also embracing the financial power of the special issue: a September issue that came out before the release of the blockbuster game Halo 3 for the Xbox 360 from Microsoft included a 19-page feature section.

"We've integrated our organization, and print is an important part of the proposition," said Jason Young, the chief executive of Ziff Davis. He added that despite the problems in the business, the company plans to keep its game titles. "Certainly, peeling off individual pieces is not part of our strategy at this time," he said.

Mr. Cox said Ziff Davis is continuing a strategy that tries to bounce the reader back and forth between its magazines and its Web sites. "Users can't get enough information about some of these games," Mr. Cox said. "You're just providing different ways of getting into the game."

According to company reports, Ziff Davis's digital revenue increased by 14 percent in the second quarter over the same period last year, but revenue for the game group fell by more than $3 million.

And though the 1UP Network was the ninth most-visited gaming Web site in September, with nearly 3.1 million unique visitors, it drew less than half of the 8.1 million people who went to Ign.com, a game site owned by News Corporation, according to ComScore, a company that measures Web traffic. The main online site of Future US, Gamesradar.com, had 4.9 million unique visitors.

Jonathan Simpson-Bint, the publisher of Future US, said that his company also focuses on special issues for releases of new game systems like Wii, which come with high-quality visuals and a high newsstand price.

Given the competition from the Internet, "we've had to be more ingenious about the way we've approached it," Mr. Simpson-Bint said.

Future US's game magazines earned $46 million in 2006, a $4.8 million drop from 2005, according to company reports. The circulation for PC Gamer, a leading magazine from Future US, shrank to 210,369 this year from 300,271 in 2003, according to the Audit Bureau of Circulations.

Magazine publishers say that readers want longer features and in-depth articles as a counterpoint to the short, bloglike pieces they find online. But Kyle Orland, a freelance journalist who writes a media coverage column for Gamedaily.com, wondered if that strategy was working, saying that when a large feature is published, it doesn't get read.

"Attention spans are just getting so small that readers don't know what they want," Mr. Orland said.

But game players are also suspicious of publications' ties to the game publishers they write about, said David Gornoski, the editor of a Web site called Vgmwatch.com. "We're seeing situations where publishers are dangling exclusive stories in front of publications in exchange for scores for their products," Mr. Gornoski wrote in an e-mail message.

Still, some longtime players still find the magazines useful. "I like reading in print because I can carry it around with me if I don't have Internet access," said Alexandria Velez, 31, a student in information technology from Staten Island. "Wherever I go, I can carry a magazine."

Mr. Simpson-Bint of Future US said that the Internet was not the only drag on the revenues of game magazines. Another factor, he said, was the mercurial nature of the games market itself, where a slowdown automatically means a drop in advertising.

"It's a really tightly linked ecosystem," he said. "The fortunes of the magazines are very profoundly linked to the fortunes of the hardware platforms."

Sunday, November 18, 2007

BoSacks Speaks Out: On why?, On Ripplewood, and Publishing Biz

BoSacks Speaks Out: On why?, On Ripplewood, and Publishing Biz Plans.

Re: Advertising
I keep reading that advertising is fleeing print media and going to the Web.
But when I read a magazine or a newspaper, I can't help but notice some of
the advertising, and even appreciate the often beautiful photography, while
I look at the Web every day and I never see an ad because I never click on
them, and as for pop-ups, I cannot resist the temptation to click on 'skip
this ad'. A website is not a billboard: if the ads become so intrusive that
they get in the way of what I want to see, I will stop visiting that site.

So what's going to happen to advertising? I've always been convinced that
most advertising is a waste of money anyway; do some people actually look at
ads for pleasure? Or is it all going to go kerflop?
(Submitted by a Retired writer)

Re: Perspective on Consumer Magazine Circ Levels-First-Half 2007
All I have to say is all of them are still giving away subscriptions at a fraction of the cost of printing and mailing. It still is a joke to me how this works. The advertisers have to be stupid to buy into this farce.
(Submitted by a Paper Person)

RE: Bringing down the house of Reiman . . . one "ripple" at a time
Interesting article. There is middle ground: Taunton Press is an example. They sell advertising, but only endemic advertising. In addition, it is kept out of the editorial well so as not to intrude on the content. This approach garners additional revenue for circulation-driven magazines with out compromising the content value of the publication: because of the selective aspect, the ads become, in effect, an extension of editorial value to the customer.
When I worked there years ago, something like 95% of subscribers claimed to keep every issue of the magazine. A lower but similar percentage (maybe 91%) viewed advertising as a significant and positive component of the magazine's value to them. These statistics and commentary in focus groups made clear that the customers recognized what Taunton's policy was all about, and that it benefited both subscribers and the company.
(Submitted by a Publisher)

RE: Bringing down the house of Reiman . . . one "ripple" at a time
. . . It's sad when organizations can't see the beauty and uniqueness of something and feel they have to change it to be like everything else.
I believe there have been some horror/sci-fi movies that dealt with this concept and I don't remember any of them ending well.
Just think, we could see Swarm of Ads, Revenge of the Copy Clones, Return of the Magazine Zombies, Invasion of the Magazine Snatchers,

Hopefully someone will wake up and realize what they are doing before its too late.
(for the sake of full disclosure, my wife subscibes to Taste of Home and we buy the Taste of Home specials from the newstand)
(Submitted by a Purchasing Manager)

RE: Bringing down the house of Reiman . . . one "ripple" at a time
Oh No! There's one ad in the book!! I'm not renewing!! Is this really an issue, a few ad's in the book to help the offset rising postal and paper costs? It's not like they're changing the whole format of the book we're talking about a few ad pages here. Watch out the sky is falling!!!
(Submitted by Senior Paper Director)

Re: The Magazine Format is not a Business Model . . . An answer for Jeff Jarvis:
Great Article! Rex is right on the money (though not 40 million of it) This is the first time I have heard someone divest the magazine format from the business model in this manner. It helps provide greater clarity and insight into thinking how publishers can improve their business model, regardless of what level they function at. The same premise applies to book publishing. I have a friend who recently self-published a high-production coffee-table garden book. He is selling in person at home show appearances and through his website. 2,500 books to sell and every sale is important. He sells 20 per day at the shows, more on his website, was picked up for 50 as upcoming corporate gifts, some at book signing appearances, etc . . . the entrepreneurial spirit finds a way . . . and its very refreshing to see it in action.
(Submitted by a consulting company President)

Re: Your Next Publishing Business Plan . . .
Your recent article in Publishing Executive raises some excellent questions on the issue of how (or whether) the next generation reads. As you suggest, the answers depend as much on the direction of our schools as on the direction of the publishing industry.

The portion of the U.S. population that's illiterate is probably no larger today than it was in the middle of the last century, but it's a certainty that there are more media choices now than there were fifty years ago . . . and that shrill, superficial, and shallow content has grown a lot faster than erudition.

As H. L. Mencken said, nobody ever went broke by underestimating the taste of the American public. It's been true since the birth of print that the least challenging media attract the largest audiences.

But demand drives supply. If, to use your phrase, we've created a generation of instant gratification seekers, the harm was done in our schools and homes, not in publishing companies. We can't reasonably blame the media for making popular products.

Though they hardly qualify as answers, I have a few thoughts on your questions.

First, when it comes to media, desire for instant gratification reflects the absence of critical thinking. It would be very much to our benefit as a society if schools focused more on teaching students how to think critically. One result might be reduced demand for shallow and superficial media.

Second, if there's a single subject that we ought to add to the school curriculum, it's media studies. I'm continually astonished that students aren't taught about the role of commerce in media, about the relationship between advertising and content, about how advertising works and the effects it can have, about vested interests, or any of the dozens of important related issues about a phenomenon that dominates their lives.

Maybe we could find a few extra minutes for this significant subject by eliminating gratuitous award ceremonies.

If increasing numbers of young people are satisfied with "bite-size" media and want instant gratification in content, it's not the result of change in the media or technology. It's the result of schools that are not fully serving our children, and parents who seem oblivious that their children are being shortchanged. For every teenager who doesn't read books there are two parents who didn't read to their child.

Finally, it's indisputable that the invention of printing was an event that changed history in many dramatic ways. But to think that digital technology will have anything close to the same effect on society is a bit far-fetched.

People made lofty and extravagant claims for radio and television, too, back in the day, most of which never bore fruit. I'd love to see some credible, empirical evidence that computers have improved the overall productivity of American business in the past 20 years . . . or that computer-aided education has made students smarter. . . or that the Internet has improved the quality of journalism. I'm not saying the evidence doesn't exist, just that we shouldn't take these things as articles of faith.
(Submitted by a Publisher)

Re: Your Next Publishing Business Plan . . .
The question you pose is not new. I remember hearing the same argument as a child, but instead of Playstations, TiVo, the web, PDA's, the iPod, 24/7 smart cell phone as the culprits, it was three channels of television; four when PBS made it through the airwaves. I read little as a teen, but after finishing school and starting life in the real world, I quickly learned reading was a necessary to advance my career. I suspect many others experienced the same revelation since my demographic is now considered the top readers.

The moral is, people, as a demographic, do not read during the years they are not focused on a career. Many studies support this theory, showing the older demographic does not read as much as those in the middle of their career. These are the same people who said my generation did not read.
(Submitted by a Printer)

Magazines, Newspapers May Benefit from Writer's Strike

Magazines, Newspapers May Benefit from Writer's Strike
MindShare Survey: Consumers Plan to Change Viewing Habits
By Brian Steinberg

NEW YORK (AdAge.com) -- A prolonged writers' strike could send regular TV viewers to other media -- particularly print -- and might prompt marketers to reallocate their ad spending, according to a poll conducted by WPP Group's MindShare.

Other options
One out of four adults surveyed said the strike will affect or change their viewing habits. That finding was highest among 35- to 44-year-olds and lowest among those 65 or older. The telephone poll, conducted during the weekend of Nov. 9 among 703 adults, found that 25% of the sample would "most likely" turn to books, magazines and newspapers if a favorite show was not on the air. Meanwhile, 13% said they would "watch whatever comes on at the time my usual TV show is on," and 12% indicated they would watch DVDs or pre-recorded videos.

The survey could lend ballast to marketers' greatest concern, that a prolonged strike will send significant numbers of consumers into the arms of other venues for entertainment and information, thereby weakening the power of TV -- which has long captured the majority of U.S. ad spending.

Even though 69% of the sample was aware of the continuing writers' strike, which commenced Nov. 5, consumer attitudes at present are largely hypothetical, noted Tata Sato, managing partner, director-insights at MindShare. After all, many networks continue to show original episodes. At present, only original late-night programming has been largely curtailed, with favorites including "The Colbert Report" and "The Tonight Show with Jay Leno" being forced into repeats.

Should the strike continue, she added, consumer attitudes may become more pronounced, particularly about whether viewers will simply acquiesce and watch whatever is on the air at when an original episode of a favorite program was once slotted to run. MindShare expects to continue its consumer survey and advise clients accordingly. The media firm works on behalf of advertisers including Unilever, Sprint and American Express.

An early favorite
The respondents' selection of print as an early favorite alternative could prompt bigger issues for advertisers. While TV is a broad-based medium, most print is not. Magazines and newspapers are not able to offer marketers different kinds of content at different times of the day.

Respondents between the ages of 18 and 34 -- a prized demographic among advertisers -- said they were most likely to read a book, magazine or newspaper (19%); watch DVDs (11%); go to the internet (10%); or listen to music or the radio (7%). Selection of the internet was greatest among younger consumers and declined among older respondents, with only 4% of respondents 55 and up saying they would check out the web.

At present, consumers have a very high "forgiveness factor," said Ms. Sato. Many say they would return to TV if a strike forced cessation of original episodes of their favorites. Among respondents, 73% said they would "continue or go back to watching the show on a daily basis"; 12% said they "may not watch anymore"; and 8% said they "definitely won't watch."