Advertising, Print vs Online

Image: Telstar Logistics / some rights reserved

Some stark research in Gary Arndt’s excellent post for Tnooz a while back: Why do travel advertisers continue to avoid bloggers?

Former Morgan Stanley analysts and current partner at Kleiner Perkins Caufield & Byers, Mary Meeker estimates that 28 percent of all time with media is spent online, yet only 16 percent of advertising is spent on the internet. This disconnect between media consumption and ad spending is estimated to be $50 billion annually.
That $50 billion dollar disconnect falls most squarely on print, which gets 26% of all ad spending but only 12% of media consumption based on time. Television has only an 8% disconnect, whereas radio is in the same boat as the internet…

Top travel magazines such as Conde Nast Traveler, Travel + Leisure and National Geographic Traveler charge around $100,000 for a full page ad for a single issue….$100,000 for a single flip of a single page of a single issue of a single magazine…Taking into account the differences in audience size vs the difference in cost structures, there are efficiencies of 10 to 100 fold to be found in the blogosphere. I’m not talking even double or triple the benefits, but one or two orders of magnitude… The reality is, however, blogs aren’t even part of the conversation at this point.

It startles me that – within the Travel industry, anyway – this is still the case. It also toggles with one of the biggest truisms in media – when it comes to advertising and editorial development (read: budgets) the tail will usually wag the dog. Thus, according to the above, print sections within media organizations are going to have the lion’s share of budgets for some time yet, and bloggers will continue to feed off adsense scraps. Is it a case of waiting for the old-school advertising execs to retire before the paradigm changes? Do we really have to wait a whole generation for the ratios to shift? Or does this piece get it wrong – are the ad agencies shifting their focus quicker than the it suggests? I’m intrigued to know your thoughts.. especially anyone out there who works in advertising.

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4 responses to “Advertising, Print vs Online

  1. Paradoxically, I think it has something to do with the lack of ability of bloggers to market themselves to the advertisers. With print, the entire publication is geared towards marketing to advertisers and explaining how large the readership is, and how relevant the readers are to the advertisers. With bloggers, the equivalent is a disaggregated statistics-driven way of reaching potential advertisers via ad networks.

    Companies spending money advertising online (via ad networks) generally don’t even know which websites their adverts will appear on. If bloggers were able to approach big advertisers directly and say “these are the kinds of people reading my blog, there are this many of them, and they are perfect for what you are advertising” then it would be a different situation. But by the time blogs get that big they are likely to be full commercial enterprises anyway.

    Having said that, I know from talking to my Loco2 colleague, Ed Gillespie – blogger at http://www.lowcarbontravel.com – that he has been approached by individual advertisers offering him orders of magnitude more than pay per click advertising, and without even making the revenue dependent on click-throughs. In that case it was specialist travel companies appealing to a specific niche (overland travellers) and dare I say it, the offers were probably borne out of a degree of naivety.

    In this example, the advertisers are used to the very high margins of print and they seem to have come on to the web and expected it to work the same (i.e. spending a lot, generally for very little by way of tangible results, but potentially more in the way of brand-building). In actual fact, online advertising can deliver far more tangible results (especially in the case of paid search) because you are targeting customers explicitly when they are looking for your product (e.g. a train ticket) and you can choose to pay only when they have actually started viewing your brochure (website).

    It’s an interesting area, and I wouldn’t take the stats quoted above to be anything like the final word. Print media is in crisis generally despite the disproportionate advertising revenue they enjoy, and so I don’t doubt that online will continue to make headway in the coming years.

  2. Dear Benji

    This is the old story of ‘Statistics, Damn Lies & Statistics!’

    Let me set my stall first. I have been in Marketing & Sales for most of my life including for some large multinationals. I guess I will fall within your “old Guard” brigade due to my age. However, I run a consulting firm that provides consulting & marketing services for both traditional and Internet Marketing, so I have no axe to grind either way.

    The main benefit of marketing on the Internet is the ability to track performance. For our clients we can provide data not just on their expenditure but exact size, make up, and behaviour of audience as well as measure their response. This is near impossible for any other kind of advertise.

    However, Internet is not omnipresent and universally used by all ages, all segments and for all products. Internet is just part of the routes to market and an access channel to your target market.

    Whilst I fully agree with your suggestion that the kind of money some print media charge is ridiculous and madness for those who pay it, there are some benefits in printed advertising.

    Firstly the useful life of a magazine (note not Newspapers) is extremely long. Think about all those old car magazines, Good Housekeeping issues, Cosmopolitan periodical, etc. that are stacked up in every home, hotel rooms, hotel lobbies, doctors surgeries, dentist waiting rooms, etc. Whilst the shelf-life of the magazine might be restricted to its publishing cycle, the Useful Life goes beyond it. Just as an example, a client of mine still is receiving enquiries that are due to their advert in a magazine used for advertising 3 years ago!!

    Secondly, printed & TV are excellent channels for building brand & demand. In fact unless you build a brand in the traditional media, you are unlikely to be searched for on the Internet. Let me expand. If you are a TV manufacturer you are unlikely to be selling direct to the public. You have to build a brand and create demand for your products and more importantly for your name. Without this brand building you will not change the Internet search from generic TV to a search for a specific make of TV.

    In my view there is a place and necessity for multi-channel approach to marketing, but how much you pay for the privilege of seeing your ad in the print (or on the screen) is rather dependant on your budget, your objectives & your strategy.

  3. I really enjoyed reading this, I agree and it opened my eyes to things I haven’t thought about. thanks

  4. I do think it will take a while for advertisers to understand that the internet, which includes blogging is a vital tool for advertising. Also, print media should have the most money allotted to it because of the retention time their ads have and their attractive look in a magazine compared to T.V. and within print, newspapers. However, do you know the statistics and how blogging is beneficial for advertising?

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