Retail marketers need a lot more than bigger Web banners, more affordable (read: shorter) prime-time television commercials, and splashier events to solve their biggest problems.
Magazines are waking up to a hard truth that has only been accentuated by a softening economy: Delivering an audience isn’t enough anymore.
To survive an increasingly cluttered landscape, media have to solve the problems that keep client chief executives awake at night — most notably the thorny customer-relationship challenges posed by today’s mega-retailers.
Now that mass merchandisers have begun to demand not only help with traffic generation, but measurable proof of performance in generating incremental brand sales among existing shoppers, the onus has shifted from price-based trial incentives to more targeted, repeat-purchase strategies. Dealing with this issue in the years to come will require wholesale re-engineering, particularly for print media.
How can magazines help prove brand performance and improve trade positioning in a tightly watched retail environment? By turning into a custom-targeted promotion vehicle.
For example, one consumer products manufacturer has run a series of promotions in Reader’s Digest aimed at increasing brand sales within specified outlets of a large U.S. retailer. The manufacturer ran a questionnaire in the magazine and built a predictive model based on the responses that signaled where people were most likely to shop. It then created eight-page “unserts” (booklets tipped, but not bound, inside the front cover of polybagged subscriber copies). The target was specific: women 25 to 49 who have children at home and live within a 25-mile radius of the key account’s stores. The magazine was able to create five “retailer editions,” each containing either a coupon or a sample incentive.
The result: Some six percent of coupons were redeemed (more than five times the 1.1 percent industry average), with 93 percent redeemed at the targeted stores. More than 200,000 product samples were requested, and sales in targeted stores spiked 21 percent. All this from a database-driven circulation of less than two million (roughly 18 percent of the magazine’s total 11.5 million U.S. subscribers).
Boosting sales from targeted consumer groups surrounding particular locations is a pivotal challenge faced by a wide range of dealer- and retailer-driven marketers. Magazines haven’t played a central role in the solution because they were unwilling or unable to transform from simple publishers to custom promoters. While the Reader’s Digest program I described relies heavily on state-of-the-art selective mailing technology, merging advertising and promotion requires more than sophisticated printing capability. Here are the keys to giving CEOs a good night’s sleep:
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Shopping community. The mass-merchandiser phenomenon has transformed “where we shop” into a source of identity and a powerful marketing classification. Marketers can fight the trend or go with it. The answer is obvious: Accept that the retailer has a primary brand relationship, and create programs that reach out to households most likely to shop at a particular location.
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Selective mass. When moving the needle at retail is the primary measurement, the key to a “multiple screen” database program is targeted scale. The final distribution list is the intersection of the brand’s target, the magazine’s subscriber base, and the retailer’s shopper base. Unless you’re marketing an ultra-high-ticket, ultra-high-margin niche product, your print partner needs a large readership pool to draw from. That means either a leading specialty publication with vertical mass or a large general-interest publication with targetable mass.
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Precise delivery. Getting the right offer to the right households is what it’s all about. The magazine has to be able to select specific households for distribution on a geo-demographic basis. Merging retailers’ frequent-shopper and subscriber lists is great, but greater opportunity lies in identifying all households within store trading areas on a block-by-block basis that fit the category or brand profile, then singling them out from the overall subscription list. Melding the accuracy of database targeting with magazine delivery requires high-speed printing and address capability on a large scale.
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Media involvement. Silent co-branding is the point of retailer-specific programs, so it’s not enough to have the right list of consumers. The targets must be truly involved with the content (so a regular issue is more powerful than a special, one-time-only publication), and that is best measured by the time they spend with each issue and the actions they take as a direct result of articles or ads. Otherwise, you’re merely adding to the flood of one-shot solicitations that hit trash bins unopened.
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Accountability. The magazine has to build in accountability measures. These aren’t off-the-shelf programs, they’re customized ROI solutions. Often, the success depends on the details. For example, if you want to gauge the impact in terms of coupons redeemed in the intended stores, the magazine has to be able to code each coupon.
Retail marketers need a lot more than bigger Web banners, more affordable (read: shorter) prime-time television commercials, and splashier events to solve their biggest problems. They need media partners whose brands they can piggyback to measurable results in specific locations. Magazines have the technology. Now, some of us are getting the point: Forging store-specific programs with promotion pros can be the medium’s next profit frontier.
Dom Rossi is executive publisher, U.S. Magazine Groups at Reader’s Digest, New York City. He can be reached at [email protected].
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