The data accrued from being part of a circulation audit process is helping media owners in the Middle East fend off the worst effects of recession by targeting new revenue streams and brand extensions for their titles.
That was the one of the conclusions reached during a session at FIPP’s World Magazine Marketplace event in Dubai, hosted by Glenn Hansen, President of global auditor of media, BPA Worldwide.
Hansen had cited a ZenithOptimedia latest forecast that advertising spend levels will plunge by 9.9% worldwide this year, returning to modest growth of 0.5% in 2010, with spend in in the MEA region is set to dip 11.4%.
“I would say that a prediction of a drop of only 11% is probably hopeful,” commented Kevan Jones, Managing Director of AV Specialist in the UAE.
“Certainly in the b-to-b market there are many publications where the drop in advertising revenues is closer to 20% over the last twelve months. As media owners we have only been able to mitigate the impact of this drop by utilizing the information in our database gained through the audit process that has given us knowledge about and a relationship with readers that had helped us run workshops, conferences, seminars, digital editions etc. You can only do that with really good data and that’s why media auditing should be in the lifeblood of every professional publisher irrespective of where they are.”
Fellow panelist George Middleton, Managing Director of Red House Marketing in Bahrain agreed:
“Now that the results of online advertising can be proven more precisely than ever, it has become far more credible as a medium compared with existing print media. As publishers, we need to be concerned about how we give our advertisers a greater guarantee of what we’re delivering in terms of readers and market sectors.”
However, the delay among local advertisers and agencies in the GCC to fully embrace the importance of audited media is clearly proving frustrating for those media owners in the region which have committed to providing verified data.
“We operate in a market that is regional but many of the magazines that we compete against in specific countries are not audited,” Jones said. “We find ourselves compared with media where there is no verifiable data and their circulation claims are just codswallop. For me, the importance of having independently audited data to an international standard readily available for every media buyer that you want to communicate with is critical.”
“Ours was one of first titles in the region to be audited by BPA. We would tell clients we were very proud of our audit but they couldn’t understand why we would want to share audited data with them. Even now, where there are more than a 100 publications that have a BPA audit certificate, to a large extent many media buyers simply are not treating it as anything more than a tick box that makes them feel good. They don’t look beyond the main figure; they don’t differentiate between people who have applied for membership and those that have achieved an audit. In fact, I suspect decisions are still largely made on the relationship between the publisher and the advertising agency.”
“I was with one client last week discussing audited media and she said, frankly, ‘I just don’t care. I know people read your magazine but I know people also read other magazines that are not audited’,” continued Middleton.
“Certainly it helps with international agencies and international decision makers, in Paris, Switzerland or wherever who demand transparency, but among local advertisers it hasn’t had much impact yet. That’s the uphill struggle we still have in Bahrain where auditing is still a new phenomenon. We were the first title and now there are three with a BPA audit. However, at the moment, not all advertisers fully appreciate the reasons to choose audited media; they are not deciding whether to spend more or less based on audited media.”
Hansen countered that since the creation of CASTOR and the amnesty for media owners to embrace auditing, there is clear evidence of progression in the market.
“Since the amnesty, when no penalty was issues for reporting fiction instead of fact, we have seen more than 100 titles embrace independent auditing. Sure, many of them are English-speaking but an increasing number of Arabic titles are coming on board now as well, providing reassurance to the growing number of licensors coming into the region. These are all progressive steps.”
The suggestion that the IAA UAE Chapter is preparing an industry code of practice which it hopes to have drafted by mid-2010, was welcomed by the panel, especially the idea that the code should include a statement regarding the use of verified data when recommending media buys, which produced a hint of the frustration that media owners feel towards agencies in the current climate.
“As a publisher since 1991 my experience of dealing with advertising agencies has not changed that much over the years,” commented George Middleton.
“It is often too difficult to fathom the reasons why decisions get taken; a ‘budget shortage’ is a euphemism for ‘lowest price’. The current crisis has exacerbated this situation where shopping around for deals can appear to have driven the placement decision. As publishers become more transparent with their circulation numbers, there needs to be a greater respect for the pricing shown on media rate cards. Those who actually pay the final bill should also be demanding more transparency throughout the whole media buying chain.”
The session also addressed how circulation auditing could be one way of providing reassurance to licensors coming into the region that the relationship with their licensee if effective,
“Licensors typically have a clause in their contract with their licensee that enables them to request an audit. Often this is a financial audit to prove that the advertising revenue of which the licensor receives a percentage is actually true,” explained Hansen.
“This is rarely imposed because it is normally the final act in a relationship that has already broken down. A circulation audit earlier rather than a financial audit required by the licensor would them the checks with this licensee that provides real data about circulation and about retail sales which, together with physical copies of the magazine, will provide greater reassurance.”
Kevan Jones agreed:
“I have been involved in licensing deals in Africa that have all gone sour because I’ve been fed misleading, falsified financial and distribution information. A circulation audit would go along way to removing that problem. Anyone preparing information for a proper circulation audit knows you need to have reasonable financial control within your business. Even without hard financial data, you will get solid information back.”
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