Print-advertising: Analysis

Publishers and direct mailers borrow each other's strategies

To provide a more appealing advertising vehicle, publishers targeting Spanish-speaking audiences are adopting direct mail strategies, while direct mailers are adding editorial content to compete with publishers.

Tribune's Hoy recently switched from paid daily publications to free dailies in the Chicago and Los Angeles markets. Hoy-Los Angeles will put out a free daily (circ. 80,000 Monday-Thursday and 150,000 Fridays) to compete with the large, mostly home-delivered weekly Impacto USA. A year ago, Impacto USA, published by the Los Angeles Newspaper Group (Media News Group), increased its circulation from 100,000 to 250,000 copies, mostly through home-delivery. The newspaper has been a good vehicle for single sheet ad inserts (FSIs) and catalogs (Ikea recently inserted a 40 page catalog).

In Chicago, Hoy competes with the free weekly La Raza (circ. 200,000), which also has a large home-delivery component. In order to get the results they need, advertisers, particularly retailers, want wider reaching publications. For this reason, TMC (Total Market Coverage) products are especially popular.

Rumbo, a network of four Texas Spanish-language dailies originally distributed as paid publications at newsstands, is also making adjustments to its distribution strategy – home-delivery now plays a more important role in its distribution mix. “Household distribution has proved to be not only a great program for insert campaigns but also for ROP advertising,” says Rumbo marketing director Giovanna Rueda. “We currently deliver to 275,000 unique households weekly. We're working to increase that number by 15% to 20%.”

…and direct mailers incorporate editorial content

This May, Todo Bebe, producer of multimedia Spanish-language pregnancy and parenting content, plans to partner with targeted print ad company ADVO to distribute its new bilingual publication Todo Bebe Direct. Todo Bebe Direct will be delivered inside ADVO's ShopWise wrap to 6.7 million households in the top 25 Hispanic DMA's. Todo Bebe's executives explain that they opted for a mass distributed direct mail product because they felt a traditional magazine approach would miss a portion of their target audience. Interestingly, a substantial part of Todo Bebe Direct, a six-page bilingual publication, will be editorial content.

The pricing war

The prices for print advertising vehicles targeting Spanish-speaking audiences differ widely. Shared co-op mailings have CPMs (cost per thousand mailed envelopes) of approximately US $5. ADVO, a company that derives the majority of its revenues from its shared-mail ShopWise Wrap, made US $38.28 in shared mail revenues per thousand pieces in 2004 and had an average of 8.33 pieces per package. Some shared mail offerings can be priced even lower. For instance, Harte Hanks Pennysaver, which puts out the Spanish-language product Pensando en Ti in Florida and California, offsets the cost to advertisers by including classified advertising in the mailings.

Premium for editorial content

National newspaper and, especially magazine, advertising tends to be the most expensive (see box). While the circulation of most publications is much lower than for direct mail products, their editorial content can be a very effective tool for connecting with specific audiences (e.g. a women's service magazine, home improvement or personal finance supplement). The main challenge for newspaper and magazine publishers is to be able to charge a large premium for the editorial (non-advertising) content of their publications. This premium can translate into less reach for advertisers or higher CPMs than pure advertising products (e.g. flyers, direct mail).

Print ad prices by vehicle…

Source: Portada® research