Take care of your local customers too
Amid a slump in advertising, the Publicitas Publishers' Conference offered a ray of hope
In the midst of an advertising slump, the Publicitas Publishers' Conference was encouragingBy Markus Knöpfli The bottom has been reached, the economy is on the upswing again - that is the basic tenor of the economic forecasts. The Publicitas Publishers' Conference tried to show when publishers in Switzerland will also start to feel the upward trend.
While there is ever louder talk of an economic recovery everywhere, publishers in Switzerland are currently presented with a gloomy picture. In May, job advertisements continued to slump. Not only did job sales fall compared to the same month last year, but they are even lower than in 1999. The cumulative figures from January to May are also worse than they have been for four years. This was made clear by Publicitas Director General Ernst Grab at the beginning of the Publicitas Publishers' Conference in Bern. The conference was titled with the anxious question "Will things pick up again in 2003?
Nevertheless, consoling words prevailed in Bern. "There will be a recovery, but the economic upswing will be more moderate than the slump," said Marc Büdenbender, Associate Director and Group Economist at UBS AG. He estimates that the publishing industry will return to the level of 2000 in terms of advertising revenues in about two to three years. Based on factors such as the oil price, the global economy, gross domestic product, fiscal policy and various statistics, Büdenbender concluded that the advertising market should start to pick up again from the end of the year.
This is also evident from a comparison over several years of the Publicitas Index with the business barometer of the Swiss Institute of Economic Research (KOF) at the ETH Zurich. In the past, their curves were somewhat shifted in time, but otherwise very similar, so that, according to Büdenbender, the following rule of thumb can be derived from this for publishers: A change in the economy indicated by the KOF barometer has an effect on advertising sales about six months later (see graphic).
Turning to local customers as a new strategy
Markus Ehrle, Marketing Director at Publimedia, also expected a recovery by the end of the year. However, he warned that the media mix could develop to the disadvantage of print media. Although clients would continue to prefer print, media agencies, according to a survey, were tending more toward TV - probably because they could better distinguish themselves with TV campaigns, as Ehrle suspected.
He therefore called on the publishers not to slacken in any way in their marketing of the genre. Advertising must be made "flexible, simple and cost-effective", the press must provide performance certificates such as Publimedia's Print Advertising Monitor, and offer planning and scheduling aids that are also affordable for small media agencies. The titles should also enable links with other media, telecommunications and information technology.
Daniel Hofer, CEO Publicitas Promotion Network, reported on a meeting of US publishers. There, too, they are assuming an economic recovery, but are convinced that "the times are over when you could generate 40 to 50 percent of your sales with 10 or 15 top customers. In the U.S., newspaper and magazine publishers would therefore again increasingly turn to small, local customers. Hofer therefore recommended cultivating local customers even in times of economic boom.
While there is ever louder talk of an economic recovery everywhere, publishers in Switzerland are currently presented with a gloomy picture. In May, job advertisements continued to slump. Not only did job sales fall compared to the same month last year, but they are even lower than in 1999. The cumulative figures from January to May are also worse than they have been for four years. This was made clear by Publicitas Director General Ernst Grab at the beginning of the Publicitas Publishers' Conference in Bern. The conference was titled with the anxious question "Will things pick up again in 2003?
Nevertheless, consoling words prevailed in Bern. "There will be a recovery, but the economic upswing will be more moderate than the slump," said Marc Büdenbender, Associate Director and Group Economist at UBS AG. He estimates that the publishing industry will return to the level of 2000 in terms of advertising revenues in about two to three years. Based on factors such as the oil price, the global economy, gross domestic product, fiscal policy and various statistics, Büdenbender concluded that the advertising market should start to pick up again from the end of the year.
This is also evident from a comparison over several years of the Publicitas Index with the business barometer of the Swiss Institute of Economic Research (KOF) at the ETH Zurich. In the past, their curves were somewhat shifted in time, but otherwise very similar, so that, according to Büdenbender, the following rule of thumb can be derived from this for publishers: A change in the economy indicated by the KOF barometer has an effect on advertising sales about six months later (see graphic).
Turning to local customers as a new strategy
Markus Ehrle, Marketing Director at Publimedia, also expected a recovery by the end of the year. However, he warned that the media mix could develop to the disadvantage of print media. Although clients would continue to prefer print, media agencies, according to a survey, were tending more toward TV - probably because they could better distinguish themselves with TV campaigns, as Ehrle suspected.
He therefore called on the publishers not to slacken in any way in their marketing of the genre. Advertising must be made "flexible, simple and cost-effective", the press must provide performance certificates such as Publimedia's Print Advertising Monitor, and offer planning and scheduling aids that are also affordable for small media agencies. The titles should also enable links with other media, telecommunications and information technology.
Daniel Hofer, CEO Publicitas Promotion Network, reported on a meeting of US publishers. There, too, they are assuming an economic recovery, but are convinced that "the times are over when you could generate 40 to 50 percent of your sales with 10 or 15 top customers. In the U.S., newspaper and magazine publishers would therefore again increasingly turn to small, local customers. Hofer therefore recommended cultivating local customers even in times of economic boom.
