Contract magazines have come in from the cold. So long the poor cousins of news-stand publishing houses, they now find that two of the most prestigious publishers in the country are preparing to join their ranks.
Condé Nast has moved into contract publishing through a joint venture with Forward Publishing – publisher of Agenda for the National Westminster Bank and the Tesco Recipe Collection, among other titles.
Tesco, meanwhile, has brought the National Magazine Company into the contract magazines market with a commission for a Christmas title for the supermarket’s 3.7 million loyalty club members.
The involvement of mainstream publishers follows a move by advertising agencies into the sector. Last year, Abbott Mead Vickers.BBDO bought Redwood and Omnicom bought Headway Home and Law for its contract publishing division.
There has has been a change in the kind of customer magazines being produced, which has helped the sector to flourish. Boots and Sainsbury’s are both selling high-quality glossy magazines, with a cover price. Redwood plans to sell its BSkyB TV Guide on the news-stands later this year.
This new dynamism is being driven by clients who over the past three years have increased their spending on relationship marketing. Contract magazines are seen as the synthesis of below-the-line and above-the-line strategies. They not only enhance the relationship but also the marketing by carrying response mechanisms and generating data from customers.
This has been helped along by the fragmentation of the media, which has provided smaller audiences. Now leading advertisers are creating their own vehicles to target specific audiences.
For all the growth in the sector, both NatMags and Condé Nast are being careful and hedging their bets. For so long their publishing credos have been that magazines are strong brands which need to be promoted and protected. The contract magazine business has always smacked of commodity publishing. Both publishing houses will be careful not to over-endorse the antithesis of their expensively created brands.
“This is a one-off,” says NatMags managing director Terry Mansfield.
He is adamant that NatMags’ deal with Tesco in no way compromises the company’s philosophy of branded magazines. “NatMags is well known for publishing magazine brands, rather than just magazines. When Tesco wanted to extend their brand values into a magazine it was natural that they should come to us,” says Mansfield.
He maintains that what NatMags is offering Tesco is simply an extension of the supplements and advertorials they produced for it in the past.
Condé Nast dipped its toe into the contract magazine market as long ago as 1984, with magazines for Harrods and Selfridges. However, its joint venture with Forward is a recognition that more and more clients want their own magazines. And they are starting to demand higher production values, which is where Condé Nast and NatMags come in.
Condé Nast managing director Nicholas Coleridge denies the publisher’s move reflects a strategic shift in where clients are putting their money: “This is just an extension of publishing for us. In the same way that we produce books, it is just another arrow for our quiver”.
He denies it is a defensive move: “There has been no indication in the past that clients who produce magazines cut back on their display ad budgets.”
This is only partly true. Boots has maintained its media spend in magazines since launching its own title, but Sainsbury’s diverted its magazine ad budget to its in-store publication in the title’s first year.
It is the desire to keep a grip on these budgets that has prompted Condé Nast and NatMags to move from “branded” to “own-label” publishing.