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Publishers rely on a myriad of supplier companies, platforms and services to uphold the very fabric of their infrastructure and day-to-day operations. Whether it’s social media platforms like Twitter, content analytics services such as Parse.ly, or hyperlocal ad software like Broadstreet ads, the number of third-party vendors underpinning a publisher’s activities has ballooned over the last decade.
But what happens when a key publisher supplier performs an abrupt pivot (here’s looking at you Google) or, even worse, closes its doors? For B2B trade title, LBM Journal, serving the lumber/building material distribution industry in the U.S., the closure of the advertising research and trends forecaster Baxter Research represented a heavy blow. How heavy? To answer that it’s necessary to lay out the title’s publisher journey.
Background
LBM Journal was founded in 2003, in Lakeville, Minnesota by Rick Schumacher. A pure-play B2B media company, the brand’s core products include a print magazine (published 11x/year and with a circulation of nearly 40,000), LBMJournal.com website, LBM Journal daily e-newsletter, LBM Journal podcasts and webinars, and LBM Strategies Conference (annual live event).
LBM competed head-to-head with two large, well-established titles that already had 90% of the market, forcing the publisher to be faster footed and more innovative as a key point of differentiation.
We needed something tangible to set ourselves apart from bigger competitors. To really grow, we had to find something to help set us apart from our bigger competitors.
Rick Schumacher, CEO and Founder, LBM Journal
Schumacher identified lead generation as a particularly strong opportunity for the brand, but this came with a snag. Talking to WNiP, Schumacher says, “Our advertisers wanted leads, but they also wanted robust analytics – proof that their customers (and potential customers) read our magazine, and proof that their investment in advertising was generating results. We couldn’t deliver this.”
The age-old problem with print publications has always been ROI—proof that a magazine ad was making a difference for the advertiser.
Rick Schumacher, CEO and Founder, LBM Journal
Analytics and measurement
At a publishing conference in 2004, Schumacher explained his predicament to a fellow guest who remarked that her sales team had achieved success using ad studies conducted by Baxter Research Center. The center specialised in print analytics that went beyond performance data, ad recall and other anecdotal evidence, instead focusing on recorded audience engagement and buying action.
Schumacher explains, “Our advertisers responded very favorably to the mediaViewPro Studies from Baxter Research Center because of the depth of insights – the reports also allowed our advertisers to compare the effectiveness of their ads vs. their competitors, and to actually track the effectiveness of their ad message over time. Finally, the studies delivered reader leads—which are like gold to many of our advertisers.
We were able to prove ROI to our advertisers by delivering leads, print analytics, and tools to help marketers measure and track the effectiveness of their ad creative.
The effects of adding a layer of audience insights, ad performance and analytics to their B2B offering allowed LBM Journal to steal a march on their competitors, with revenues doubling from 2004 to 2007, and after taking a hit during the Great Recession resuming with a tripling of sales between 2009 and 2019. Their cause was helped by Baxter offering a market exclusive and guaranteeing not to take on any of LBM’s head-to-head competitors as clients.
Schumacher comments, “We tracked our market share using Media Radar and steadily gained a few percentage points of market share each year. By 2020, among the three national titles, LBM Journal had grown to have than 50% of the market, with the two former leaders splitting the balance.”
“Essentially, we grew by asking our readers and advertisers what they wanted, then listening and delivering. For example, one of our competitors announced a shift to “digital first” about a dozen years ago. Considering the expense of printing and postage for a traditional print magazine, we understood the temptation. But we knew that more than 80% of our audience preferred print, while only 20% preferred digital. So, instead of “digital first,” we opted to stick with our “customer first” strategy and continued emphasizing print while building out our digital offerings. That one piece of data—our audience’s strong preference for print over digital—helped us prevent an expensive mistake.
“It is notable that as our print revenues are declining, the importance of the mediaViewPro studies is growing. With the ready availability of audience analytics for our digital offerings, more media buyers are reluctant to buy print without credible, supporting analytics. I believe that trend will only continue to grow.”
Trouble ahead
Fast forward to 2020 and Schumacher received a call from Bob Keyburn, the owner and founder of Baxter Research that he was retiring and closing the business entirely. Schumacher pulled a report to see how much impact the mediaViewPro studies were impacting LBM Journal’s revenues but was shocked to see how much of a difference they made to bottom line revenues.
In 2019 our issues supported by mediaViewPro studies generated, on average, 51% more print revenue than our non-ad study issues. That worked out to be $244,008 of additional revenue. This year the figure is $212,080 of additional revenue.
Rick Schumacher, CEO and Founder, LBM Journal
Schumacher adds, “A colleague refers to the Baxter studies as “rocket fuel for ad sales” but we simply were not equipped to bring the studies in-house – the only way for me to keep the studies going would be to acquire Baxter Research itself. So I bought the company, because frankly, I couldn’t afford not to.”
Looking to the future
Schumacher is sanguine about the prospects for his title moving forwards but adds a word of caution especially as, like most printed media, “print revenues are declining”. Indeed, as LBM’s print revenues drop over time, Schumacher’s reliance on his new acquisition is only growing, “In 2019 and 2020, as print was lower, the ad study issues gave us a significant boost”.
Looking ahead, Schumacher believes print media has to be able to compete by offering analytics that emulate the depth of insights afforded by digital media, “More media buyers are reluctant to buy print without credible, supporting analytics. I believe that trend will only continue to grow.”
He’s not wrong. The Ascential-owned forecaster WARC came out this week to announce that 2020 will see ‘traditional media having its worst year on record’. The forecaster continued by stating that, ‘Newspapers and magazines will be down by 25% this year with little or no improvement forecast for 2021….it emphasises the accelerating shift of print media towards readership and away from advertising revenue’.
In such a market, and with no sign of the COVID-19 restrictions loosening up, any glimmer of assistance for the beleaguered print media industry has to be seized on.
