As digital advertising has matured, brands have abandoned magazine ads in favour of the more detailed metrics and hyper targeting that online can offer. Magazines have gone from taking 5% of ad spend in 2015 to just 3% today, but multiple studies have shown that the format actually still offers a lot of value in terms of attention and effectiveness.
At magazine marketing agency Magnetic Media’s annual Spark event this year, closing the gap between where advertisers spend money and where the perception of effectiveness is was at the top of the agenda. With total underinvestment in the magazine market at an estimated £220 million, there is a lot of work to be done to re-educate advertisers on the potential of the medium.
Magnetic presented a new study with Benchmarketing on ‘Attention Pays: Optimising for Profit’, which explores the investment gap across the market, and what the optimum level of investment is for advertisers.
Optimising investment in media spend
Choosing where to put ad spend is not simply a matter of choosing the most effective platform and running with it, according to Anna Sampson, Magnetic’s Insight and Strategy Director.
“It’s not just about effectiveness, it’s about optimisation…it’s about absolutely smashing it out of the park, it’s about giving it your all, and what takes you to your absolute peak,” she said, arguing that we should learn from sporting heroes who have teams helping them optimise every aspect of their performance.
“The same is true in media. Study after study tells us that we need a mix of media, and that combining different channels has the benefit of amplifying effectiveness.”
“We all know that monitoring campaign performance is advisable, and testing even more so, and that it’s not enough to know how you doing and to keep improving, but also have a clear vision and a strategy, and an end goal in mind.
“And finally, they recognise that these strategies need to be individualised. No one person or brand requires the same treatment.”
With these principles in mind, Magnetic wanted to understand what the optimum levels of investment were for campaigns involving magazines, and used over 125 case study campaigns from a database of effectiveness work to draw out learnings. The study focused on campaign return on investment (ROI) rather than just channel ROI, to understand how a mix of channels influences the effectiveness of an overall campaign.
The conclusion the study reached was that there was a case for rebalancing the media mix. “At an aggregate level, the market is underinvesting in magazines and not achieving the optimum profit ROI that they could be,” explained Sampson. “There are some brands out there that could be achieving 164% improvement in their campaign profit ROI.”
The beauty gap
To illustrate the point, Sampson focused on two areas of advertising where there is notable underinvestment in magazine media, compared to the results which could be achieved: beauty and finance.
Beauty brands overall are big supporters of magazines, with 42% currently investing up to £240,000 a year on average. After AV channels, magazines are the number one channel for profit ROI for beauty brands, according to the study.
But for those beauty brands who don’t currently invest in magazines, there is huge potential. A campaign for a beauty brand in the appropriate magazine could quickly get to a 96% improvement in profit ROI, according to Sampson.
“The reason why we get this really good result for brands that aren’t spending in beauty is because actually, magazines are really strong performer in profit ROI for this particular sector, they’re the number one channel, they really deliver,” said Sampson. “It’s really nice to learn that if you’re not currently spending in beauty, you’re going to get a really big uptick by just simply spending in magazines.”
For beauty brands who optimise both their campaigns and their spending, the results are even more promising. “If you spend the optimum, which based on this analysis is 5% [of the campaign budget], then you’ll get to that 164% improvement in profit ROI.”
“There’s a really strong case there for beauty brands that aren’t already spending in magazines.”
The finance gap
To show that it’s not just beauty brands that can get a boost from magazines, Sampson highlighted some results from the study that demonstrate benefits for finance advertisers.
“Finance advertisers don’t typically invest in magazines, only 22% do. And on average, they invest at much lower levels of about £120k a year,” Sampson explained.
Finance brands tend to spend their money on TV, digital and outdoor advertising, but when it comes to effectiveness, magazines are actually in the top three channels for ROI, alongside digital and newspapers.
“If you’re a finance brand, and there’s a lot of them that don’t currently spend in magazines, you can see a 32% improvement in your campaign profit ROI simply by spending in the channel,” said Sampson. “And you can up that to a 68% improvement if you spend at optimum levels, which Benchmarketing advises is around the 6% mark.”
Magazines haven’t traditionally been an obvious place for finance brands to advertise, but Sampson asserts that magazines are increasingly offering highly relevant opportunities to finance advertisers, especially those who understand the benefits of having a finance message in a lifestyle context.
“With this new evidence that magazines are a top three performer on channel profit ROI, isn’t it time that they started to consider spending with magazines?” she asked.
The reasons behind the impressive results for these brands advertising in magazines comes back to quality attention; a theme Magnetic have done a great deal of work on recently with their ‘Pay Attention’ campaign.
“Magazines are delivering these profitable results that we see here because in part they are delivering on the quality attention that the advertising in them achieves,” Sampson explained. “Yet when you look at ad spend data, it’s around 3% that printed magazines get.”
“So this starts to raise the question, is there a missed opportunity for advertisers, is the market missing out on an opportunity here?”
Other work from Benchmarketing and Magnetic has revealed that a conservative estimate of the levels of underinvestment in magazines is currently at £220 million. To put that into context, it means getting the levels of spend in printed magazines back to 2015 levels, so magazines take 5% of ad spend rather than the 3% they get currently.
But Sampson isn’t advocating for increased investment in advertising. It’s about rebalancing the mix, and making sure that money is being spent where it is most effective.
“The case to rebalance the mix is clear, we know from other effectiveness work that magazines work really well in the mix. They work really well with TV…and they also work really well with digital.”
“So you might use TV to drive reach, you might use digital to drive acquisition, but neglect this investment in magazines – we’re talking about just 5% – and you miss out on driving consideration-type metrics, and specific segments that will also help grow the brand.”
The goal is not to convince brands to splash out tens of thousands of pounds on magazine advertising, although many in the industry would welcome that! Instead, it’s about making a strong case for marginal gains that can be achieved through rebalancing the media mix; small changes that can make a big difference when it comes to delivering profit ROI for clients.
“In a competitive marketplace, where every single pound counts, it’s a good opportunity to think about optimising to drive your profit ROI and invest in printed magazines,” she concluded.
All charts courtesy of Magnetic Media