Article from iframagazine.com
Analysis by Eric Christiaens
newspaper techniques: The Belgian daily newspapers have created joint offerings that satisfy the demand for simplicity and effectiveness for national ad campaigns. Is that enough to improve relations with the advertisers?
Eric Christiaens: Some years ago, the Belgian daily newspapers launched NP (national page) with a top offer, namely NP 3: three pages in the 12 titles of the Belgian daily newspapers. Two ad administrations, Full Page and Scripta, market this national offering and the results are very positive, as nearly 45 percent of national campaigns use NP3 and its variations.
Nevertheless, this year we are developing new national offerings for the purpose of allowing other advertisers to test this type of campaign. The charge for a campaign in the daily newspapers is acceptable for major brand products that invest massively in the leading media, but we are too expensive for advertisers working with more modest budgets.
Radio is more flexible, less expensive and offers the benefit of reactivity. It has the edge on us here, as the deadlines for supplying ad copy are increasingly short for radio. For the first time this year, we are not experiencing an increase in our market shares and we consider that it is now how time for us to tackle this problem and to investigate together with our customers why they cannot buy us.
nt: Have the Belgian newspapers benefited from the changeover to marketing advertising modules?
E. Christiaens: ‘NP’ ads are indeed based on modules, the standard being the full page. This change has been well accepted by the advertisers but we must still make every effort if we want to follow the logic of transparency and simplicity.
We have created a rate schedule based on the full page rather than column inches as in the past, but we are not all agreed on how to apply the rates, nor do we all have the same formats for these modules.
A full page does not have the same dimensions for two publishers, not even within the same group of publishers. The modules were developed to simplify things for advertisers, but instead we have re-invented complexity.
The question of charges can be summed up as follows: if a full page costs100, does the half-page cost 50 or 60 percent of the price for the full page, and does each publisher apply the same rising scale of charges?
At present, and it is only logical because it is a recent development, the approaches differ according to the titles concerned and such a situation does not make life simpler for the job of the media buyer. We are working on these problems and expect to achieve a standard system in the coming months. It is necessary to adapt without causing losses for the publishers and without applying unfair charge increases.
In our group, we have done as much for our regional charges and, because our hands are untied, we have introduced the system that best suits us. For us, it is logical to say that a quarter-page is more expensive than a full page. Such reasoning is commonplace in many sectors. If I buy a box of tomatoes, it will cost me 5 euros. If I buy 100, chances are that I will get a better price. Our customers accept this line of reasoning.
The matter of the sizes of the modules is more difficult to solve. It is not so much that the modules are different, but the exact dimensions in a format, e.g. tabloid, vary from one title to another. In order to obtain identical formats, it would be necessary to standardise dimensions.
nt: Have you made any advances on simplifying regional advertising charges?
E. Christiaens: We have made life complicated for advertisers, with so many discounts that they must sometimes feel dizzy. A sector that offers you on average 20, 30, 40 percent discounts is not very credible.
When you talk to media buyers, it is not always simple to practice transparency, because some agencies prefer you to quote a rate of 100, then grant a discount of 50 and allow them to upgrade their negotiations with the advertisers.
The question of negotiations arose on a daily basis for our sales teams. When we set out to revise our charges two years ago, we did the following test with our teams: we put forward the problem of customer X who wanted to run a campaign with several insertions and including combinations with other media belonging to the group, and asked them what price they would offer the customer? Seven out of 10 people gave us different answers.
This was most worrying because if you make a poor offer, not only do you risk losing customers, but also and especially you lose the trust of the market. We set out from different charges with the thought: I do not want to fear the day when all my customers meet and start talking about what they pay.
The primary objective was: transparency, logic and correction. If I did the same test today, I think that only two people would quote a different offer. I truly believe that we are going in the right direction, but not everything has been resolved.
As regards the two different quotes: either the person concerned was inadequately trained and we must do our job again, or there are still bugs in our system of charges. That is possible, as we handle a large number of products and we drew up these charges only recently (January 2005).
nt: What are the principles of these new charges?
E. Christiaens: We began by drawing up some basic rules. The first consists of giving a guideline for business relations in the widest sense. All our customers must receive the same proposal for a given problem and our price lists should include a maximum of five types of discounts. We carried out tests with some advertisers.
A consulting office created price simulations in order to judge the impact on our revenues of these new business practices. With some advertisers, we were aware that we must wait two to three years before we can revise the price list, as they had excessive discounts. We moved from nearly 1200 charges to 200. We have many products and possible combinations, so it is difficult to reduce this further.
Alongside these rules, we drew up a number of pragmatic replies. For example, we told the sales teams that if the new charges did not work, we could go back to how things were. But at the same time we stepped up training to convince our teams of the solid basis on which the new charges were founded.
Every time we launch new products, the sales teams tend to want to make special offers, as they used to in the past. It takes time to achieve a perfect transparency and sell the added value of our titles rather than a frequency discount.
nt: Did the new system of charges have a negative impact on your revenues?
E. Christiaens: On the whole no, though it is necessary to qualify this statement. Eighteen months after the launch of these new rules, we are ahead of our forecast business turnover. However, one of our titles played the game very well while the other was a bit slow to do so. In the case of the one that experienced difficulties, this was due to problems in the sales team that caused six months’ delay in introducing the new system.
The first year saw a “neutral” development, followed this year by a splendid period. The pick-up can be explained by offers that are better prepared, simpler to explain to advertisers and by the fact that our teams are more highly motivated. There is no secret to selling: what you need are good products and good salespeople.
nt: In the final instance, was the most difficult task the job of changing the habits of the sales teams?
E. Christiaens: When I came to this group, a salesperson said to me: 'For regional advertising, you have go to go for hard-selling, knock on 100 doors in an effort to open as many of them as possible.'
That is not my vision of advertising. I want to sell something that meets the needs of the advertisers. Obviously, it is vital also to be pragmatic because the advertiser will pace his budget with a different medium if you have nothing to offer him. But I say to the sales personnel that they should never try to sell something that they would not buy themselves.
nt: Who works on the offers?
E. Christiaens: We have a team of four people dedicated to ‘product management.’ Their job is to develop offers, improve existing ones and create effective products designed to satisfy the specific requirements of our advertisers. Their assignment is to put forward offers that are in line with the credibility and quality of our publications. But this is classic project management such as you see in all divisions of a fast moving consumer business. It is their task to develop products that perfectly balance the needs of customers and the required profitability of our business.
We are in a regional market where the media competition is fierce between the freesheets, magazines, TV, radio, Internet, etc. But we have room for special offers. For example, we have launched an upmarket magazine reserved for 10 or so advertisers active in this sector.
This magazine is sent by mail to the customers of these advertisers. The daily newspapers will remain at a constant level, we are not about to increase the number of readers in the next 20 years, so we will have to find products that will allow us to maintain revenues and profit margins.
This will mean developing different ways of getting the message across to the advertisers’ customers. And, even at regional level, the advertisers are making their communication and marketing more professional. The mass media are slowing down, it is essential to become media that set out to serve special target audiences. One possibility is to offer direct marketing, but it is also the daily newspapers and their websites that must develop.
* Concentra Media was founded in 1879. The group publishes Het Belang van Limburg, Gazet van Antwerpen and the free daily Metro. Concentra also publishes the following magazines: Cyclo sprint, Ambiance culinair, Er op uit.
The group is a shareholder of TV Limburg, Antwerp ATV and Kanaal3 as well as the local radio station Antwerpen 1. It publishes free newspapers (20 % of the De Streekkrant/De Weekkrant group). Concentra operates coldset and heatset printing sites. The group employs 900 people.
Page first published: 12.06.2006
© 2008 IFRA. All Rights Reserved.