Forget Average Price Paid - Does the Advertising Work?
By Rebecca McPheters

A recent min article suggested that audience involvement measures represent the Holy Grail for magazine publishers. Unfortunately, rather than representing the grail, both the ABC’s Average Price Paid and the “Involvement Index” – purported new measures of audience involvement –represent the misguided pursuit of a poorly selected goal.

The relationships that magazines have with their readers are unique – and poorly suited to one-size-fits-all measures. While some believe that involvement is indicative of the extent to which readers see and respond to advertising, it’s time to abandon the quest for involvement measures and cut to the chase. Instead of pursuing poor surrogate measures of effectiveness, it is time for publishers to turn their attention to more direct measures of how well advertising works.

The purpose of most advertising is to sell product. While communication is a function of the medium and the message, effective print advertising requires that the ad actually be seen by qualified prospects for the product advertised. Publishers need to provide answers to three basic questions about their readers:

Are they qualified prospects?

Do they see the ads?

Will they buy the product?

National television has the benefit of commercial ratings. These allow advertisers to look at how the commercial audience compares to the audience for the program being watched. Magazines have no similar measure. Since substantially greater weight tends to be put behind national television than behind print advertising, television is also more likely to benefit from readily discernible sales effects.

Now let’s look whether these new “involvement” measures offer any insight into our three questions.

Average Price Paid

Anyone with even the most basic knowledge of how subscriptions are sold knows that Average Price Paid is not related to involvement. Nor does it tell us who reads the publication, who sees the ads, or whether they respond to advertising.

Ironically, subscriptions with the highest average price-paid are often sold through direct mail agents. Typically, those who purchase through agents tend to be less committed to the publications they order. This is because the motivation for ordering a magazine (for example, entry into a sweepstakes or a desire to help little Johnny from down the block who is selling magazines for his school) is often unrelated to a genuine desire for a specific title. Many publishers make extensive use of direct mail agents and other agents because, even with “zero remit”, in the short-term it is frequently less costly than other methods of acquisition. While it carries a higher average price and may in fact prove cheaper for publishers in the short-term, the longer term economics of agent sold business are less-desirable because it is difficult to renew.

A better source of circulation – typically sold at a lower price - is that which is direct-to-publisher. This is comprised of those subscribers who order the publication directly from the publisher, and includes those who send in subscription cards inserted in the magazine or respond to a publisher’s own direct mail solicitations. They buy the magazine because they want it. There is no question that direct-to-publisher subscribers represent more involved readers than those who purchase through subscription agents, even though the price paid is often substantially below that of agent sold subscriptions. Publishers who make extensive use of direct-mail tend to be those who are investing more heavily in their business, trading higher costs in the short term for longer-term profitability and more committed subscribers.

Regardless of the price being paid, an advertiser’s primary concern should be whether his ad is being read – and responded to - by qualified prospects. While the Audit Bureau of Circulation plays a vital role in assuring advertisers that publishers are appropriately distributing their product, ABC reports shed no light on either readership or response. Circulation provides the foundation for development of high quality and responsive audiences, but magazine purchasers comprise only about 20%, on average, of the audience that determines a publication’s value to its advertisers.

The “Involvement Index” combines measures of three variables: reading time, frequency of reading (number of issues read of 4) and “one of my favorites”. Whether used individually or collectively, none of these speaks directly to the probability of exposure or of response to an ad.

While reading time is in part a function of involvement, it is also a function of the number of pages and editorial density of a publication. It also may say something about a publication’s readers as well. For example, Motorcyclist has a longer average reading time than most other MRI measured publications.

Frequency of reading tells us nothing about a reader’s exposure to or interest in an individual ad. If I read a single copy of Gourmet that I purchase at the newsstand, it neither makes me a less interested reader, nor does it mitigate my interest in the ads. Indeed, in my experience, single copy purchasers tend to be at least as involved as subscribers. Yet frequency of reading as an involvement measure is biased against magazines with substantial single copy sales.

While “one of my favorites” may suggest a mindset that readers bring to a publication, it is unclear what “added value” it really offers advertisers. For all MRI measured magazines, a minority of readers claim that it is “one of their favorites”. It stands to reason that people who read more magazines will claim “favorite” status for a smaller proportion of those that they read. Yet frequent magazine readers tend to be more affluent and better educated – qualities that make them more valuable to many advertisers.

A Better Way

MRI, in combination with the other syndicated services, provides estimates of the number of readers who fall within almost any conceivable target definition. However, given the industry’s current definition of a reader as someone who has “read or looked into” a magazine, it should be clear that not all readers are exposed to every ad. Audience estimates provide a measure of those who have the opportunity to see the ad, but don’t necessarily do so. However, MRI has two measures which provide significant insight into the probability of ad exposure.

The best of these is average page exposure, which was introduced to the U.S. in the 1980’s by Timothy Joyce, founder of MRI. Although not widely used, it comes closer to measuring the probability of exposure to an ad in a magazine than any other measure we have. While, like print audience measurement, it is subject to the vagaries of memory, the concept behind average page exposure is a viable one. Unlike time spent reading, average page exposure is not a function of the size of the publication – and speaks directly to the proportion of pages seen.

Also useful is “interest in advertising”. Since the question is posed specifically in regard to advertising, it is a more pertinent measure for advertisers than “one of my favorites”, though it does appear to favor specialized publications with largely endemic advertising.

The role of media is to deliver ads to responsive audiences. The advertiser’s question “do readers respond to my ad by buying my product?” is the most difficult – and the most important - to answer. There is, as yet, no way of providing easy answers to this question. However, it is not an impossible task. It is time for publishers to begin the serious quest of documenting the real value of advertising in their magazines.