As print magazines suffer while advertising shift their budgets to digital, agencies are hailing Time Inc.’s decision to let advertisers buy its magazines programmatically as a hopeful step for the medium.
The announcement by Time Inc. comes as the biggest U.S. magazine publisher — with such titles as People, Sports Illustrated and Fortune — is adjusting to its own challenges as a newly publicly traded company. In the third quarter of 2014, print and other ad revenues declined 1 percent to $363 million but would have declined 9 percent if not for acquisitions. Time Inc. is scheduled to report full 2014 earnings on Feb. 12.
Programmatic is already a big driver of digital ad sales growth for Time Inc., as it is for publishers in general. Now Time appears to be the first major U.S. publisher to sell its print advertising this way.
“With this process, print is now as easy to buy as digital,” said Andy Blau, senior vp of ad sales and marketing for Time Inc. Branded Solutions.
Currently, Time Inc. is making six audience segments available programmatically: Women, Men, Lifestyle, Luxury, Business/Finance and Rapid Scale, which is basically Time Inc.’s weekly titles Time, People and Sports Illustrated. Ad rate erosion is a common concern that comes up in connection with the rise of programmatic. But Blau said Time Inc.’s programmatic rates will vary minimally from the prevailing audience-based rates, which will prevent rate erosion.
“The apparent economies and efficiencies are driving Time Inc. to automate their media transactions, and that’s an innovation for their ad selling and could lead to more sales,” said Eric Bader, CMO of RadiumOne, a digital platform that automates media buying for marketers.
Ad buyers agreed that the ability to buy print programmatically could help attract ad budgets to the medium.
Time Inc.’s offering could attract other advertisers, by capturing dollars from digital-only advertisers or helping magazines hold on to print dollars from advertisers cutting that spend, said Andrea Luhtanen, president of Haworth Marketing, which was the first agency to do a print programmatic deal with Time Inc.
Debbie Sklar, who heads up print at Horizon Media, said she’s optimistic about the prospects of Time Inc.’s offer if it opens up avenues for targeting that print has lacked.
“If the data is available for age and income and more targeting, whether it’s psychographic or demographic, it would be a more efficient buy,” Sklar said. “Half the time we’re buying magazines, it’s wasted. It’s the least efficient medium, and rate card pricing continues to increase. They have an overhead digital and television don’t have. That in concert with their deadlines, means there’s no immediacy. Magazines have to find a better way to manage their timelines, and targeting and programmatic will be a piece in the right direction.”
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Helen Lin, evp of digital and magazine activation at Zenith, applauded Time Inc. for applying digital practices to print selling. But she pointed out that the idea that advertisers will buy both print and digital this way, as Time Inc. is hoping, is less realistic than it used to be. Now, advertisers are more likely to extend their magazine print ads to Facebook or YouTube than to the magazine’s own website. Time Inc. isn’t letting advertisers apply their own data to the print programmatic buys, which is a drawback. And the print insertion order process isn’t all that complicated, so there’s not that much to streamline anyway, she said.
Where the print programmatic offer is good is that it makes print buying accessible to digital ad buyers, Lin said, while acknowledging that “It does marginalize the print buyer.”
Certainly, print has other issues holding it back that the Time Inc. offering doesn’t fix. In addition to the long lead times required, advertisers feel digital ads’ performance is more measurable than print’s.
For now, the main advantage of programmatic print that Time Inc. is touting is that it automates the buying process. But not all of Time Inc.’s 24 U.S.-based print titles are available (18 are), and advertisers can buy according to segment but they can’t guarantee their ad will appear in a given title. The available audience segments are limited to the aforementioned six, although Time Inc. says it plans to expand them.
Advertisers also have to buy between a minimum and maximum audience sizes, which Time Inc. didn’t disclose. They still have to buy direct if they want to buy a single title or highly complex campaign, which is how Time Inc. hopes to protect its print ad revenue (and the jobs of print salespeople). That makes the offer less appealing to fashion brands, for example, which want to be in a specific title or in a certain position in the issue. And programmatic or not, print is less attractive to performance-based advertisers.
“One thing that programmatic doesn’t change is whether consumers will buy magazines and whether advertisers will continue to be satisfied with print metrics in a time when digital media, regardless of how any of this is traded, pretty much blows away the performance of print,” Bader said.