John Brown is going to teach the Americans a thing or two. Ikea,
the furnishing retailer, recently asked him to launch a magazine for its
customers across the pond. ’When Space comes out, it will be the best
contract publication in the US,’ boasts Brown, who publishes Ikea’s
magazine in the UK.
His confidence is not entirely unfounded. On a visit to the US two years
ago, Brown was surprised by what he found. ’The standards were pretty
low. The US was where we were ten years ago,’ he says.
Sensing a major opportunity, he has tied up with Meigher Communications,
a major US publisher, to help him with the Ikea launch and future
projects (±±¾©Èü³µpk10, 23 July). Space, which will be distributed quarterly
through Ikea stores, will have a circulation of one million - three
times that of the UK magazine, Room. Advertisers already lined up for
the first issue include Ralph Lauren and Absolut.
’To England, the Ikea magazine is a traditional piece of contract
publishing,’ Brown explains. ’To America, it’s an eye-opener. Their jaws
dropped. The truth is that contract publishing is not particularly easy.
It requires considerable skill. We have learnt from 12 years of
mistakes.’
But custom publishing, as it is known by the Americans, is much bigger
in the US than Britain. Big publishers such as Time, Forbes and Hachette
Filipacchi fight hard for a share of the dollars 1 billion market, as do
smaller operations. Brown says: ’It’s either a huge company or a
freelance journalist working with a friend to sell advertising.’
’The market is so monumental, people don’t know how big it is,’ says
Christopher McMurray, chief operating officer of one of America’s
largest customer publishing companies, McMurray Publishing, which
specialises in syndicated health magazines such as Vim & Vigor and
HealthDirect.
Editorially, however, the UK is years ahead. In fact, it was only
recently that US publishers cottoned on to the wisdom of attracting
outside advertising to their titles.
But John Brown is not the first UK publisher to realise the potential.
Four years ago, TPD Publishing used Microsoft, an existing client, to
set up an off-shoot in Seattle. Fluent, now in the US’s top ten, has
clients including Isuzu, Oracle and Aon Corporation.
Fluent’s president, Simon Kelly, has been instrumental in raising the
industry’s profile, and helped to set up a trade body, the Custom
Publishing Council.
Redwood too has a foothold. Earlier this year, it won a contract to
produce a magazine for the retailing giant, JC Penney. ’My view was that
we’d missed the boat,’ Mike Potter, Redwood’s chief executive, says.
’Until we started to talk to people and take a closer look. There’s a
whole lot of contract publishing, but it’s not put forward as a
marketing vehicle.’
To win the JC Penney contract, Redwood had to pitch against ten US
companies.
The result is Noise, a teenage magazine packed with fashion, beauty tips
and lifestyle features. It is distributed to 3.5 million teenagers in
1,100 department stores across the US. Redwood is now understood to be
working on other projects for the store, and hopes to bag another
contract by the end of the year.
But is the US really so backward? ’One of the main driving forces of
contract publishing in the UK has been the boom in relationship
marketing,’ Kelly explains.
’I am astounded, when I come back to England, by the amount of loyalty
club cards owned by my mum. They are nothing like as prevalent in the
US.
’And the customer magazine is often the linchpin of a loyalty
programme.’
Far from being threatened by the influx of rivals from the UK, Kelly
hopes that it will boost the market generally. ’My advice is: come on
in, the water’s lovely,’ he says.
Launching in a country as geographically diverse as the US raises
problems.
Where should you situate your office? Redwood chose Toronto, Canada.
’People in the US are used to flying 4,000 miles every week,’ Potter
argues. ’The US is regional, that’s true, but it’s not surprising to
find a company based in Seattle with clients in Texas.’
The recent increase in activity has certainly excited the American trade
press. It’s been full of articles about the sector, which now accounts
for 5 per cent of the dollars 10 billion spent on magazine advertising
each year.
The major US publishers who have previously ignored it are now
determined to get a piece of the action. Hearst Magazines, for example,
jumped on the bandwagon in June with a 112-page magazine for California
Closets, an interior decorating retailer.
Advertising agencies are at it too. In May, the Interpublic siblings,
McCann-Erickson and Campbell-Ewald, formed a unit to take advantage of
the explosion. Campbell-Ewald already owns one of the largest US
customer publishers, CE Publishing, which produces 39 titles for clients
including General Motors and IBM. Industry watchers predict other
agencies will follow soon.
But McMurray issues a friendly word of warning to the Brits: ’One
shouldn’t underestimate the competition that’s here, or the ease with
which this huge market potential can be tapped. Just because it’s big
doesn’t mean it’s going to be easy.’
Paul Woolmington, president of The Media Edge, agrees: ’There must be
huge potential. If you think that everything in the US is ten times the
size, and you do half as well as you do in the UK, there must be riches
to be had. That said, if there is ten times the potential for success,
there is ten times the potential for failure - particularly because of
the strength and size of the traditional publishing companies.’
Brown is acutely aware of this. He observes: ’We were ten years ahead
but now the gap is closing. There’s a big opportunity in America, but
the country is strewn with corpses.’
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