A quick-fire download with Ovato Managing Director Paul Gardiner about the aim of Ovato Media Bureau, why there needs to be someone waving the magazine flag in agencies, and why the magazine category continues to have the strongest ratings for trust attributes.
So tell us a little bit about Ovato?
Traditionally, Ovato’s core business was print and distribution for magazines and catalogues, but more recently the business has transformed itself into a publishing services business.
We initially saw the opportunity to become an enabler for new publishers entering the New Zealand market post the Bauer exit and that momentum has continued where we are now providing more efficient shared services support for many magazine publishers (retail marketing, ad sales, subs management etc).
Can you talk us through Ovato Media Bureau and what you would like to achieve from it?
Ovato Media Bureau has been set up to be the voice for New Zealand independent magazines and agencies. Ultimately that is our purpose, and the reason why we need to be there is because there’s a role to make booking magazines easy for agencies.
As an example, a couple of weeks back an agency booked 40 third pages across a various selection of magazines that we represent. Now if that agency had to speak to every single publisher to do that, and had it been a separate conversation with every publisher, it probably wouldn’t have happened. It probably would’ve been too hard. So we took that pain away from the agency, and I think there’s a big opportunity there for us; to make the booking process easier for agencies.
Why are magazines still an incredibly viable option for agencies and their clients?
Let’s say you launched a new media channel tomorrow, and that platform had a 100 percent paid subscriber base (a deeply committed audience), and had the most affluent audience of any media channel. Connected with consumers interests and passions, it provided advertisers intimacy at scale, had the highest engagement of any media channel, and the audience of that media channel actually liked looking at advertising on that platform.
If you launched that platform tomorrow, I think agencies would fall over themselves to book.
But I think agencies see billboards, they watch TV, they use digital, but they’re probably not as in tune with magazines. The challenge that we’ve got there is agencies may not be consumers of magazines, but there are a lot of consumers of magazines out there.
That’s why we’ve pushed Ovato Media Bureau so hard, because there needs to be a real advocacy for magazines and that’s what Bauer did really well, because they had scale.
I think there needs to be someone waving the magazine flag in agencies, otherwise it just gets lost.
Can you share some recent research around the advantages of magazine advertising?
Trust in media channels directly drives purchase intent. A study that ADTRUST did reported that 58 percent of consumers agree that the more they trust an ad, the more likely they are to buy a product or service.
In 2019, Hurst Media in the UK released a study showing that the readers of magazines give the strongest ratings for trust attributes (attributes like – accurate, offers a range of opinions, high quality, trustworthy).
Conversely and not surprisingly, social media had the lowest ranking.
That’s a really interesting insight that advertisers should be thinking about when they’re looking at what category they choose, and I think trust will be a big driver going forward.
What about the effectiveness?
That’s probably an area that is hard to qualify. You can do it with mixed market modelling, which is expensive. Every time I’ve used mixed market modeling to look at campaign performance in magazines, the ROI has always over delivered against other media.
Anecdotally, the direct advertisers who are big advertisers in magazines these days will tell you they know magazines work for them and their business as readers literally come into their stores with the magazine ad asking for that product.
They know magazines work because they see people in shops with that magazine, saying “I’ve seen this product in a magazine, can I buy it?”
I think that’s where we lose out as a category to digital, because digital is so transparent. But I think the question there is what got the consumer to that digital point?
Can you talk us through the latest magazine readership trends?
The latest readership survey was over the Covid period. It reported a growth in primary readers and a decline in secondary and tertiary readers which makes sense as no one was sharing magazines over that period; people weren’t moving around to cafes and surgeries.
When it comes to copy sales, traditionally we have seen a five percent decline year on year over the past say 10 years. That trend has been completely smashed post-Covid with actually an increase in copy sales in Q4 last year and are expecting another year on year increase in Q1.
Put that down to the massively invigorated category you are seeing at newsstands (we launched or relaunched 22 magazine brands towards the end of last year). If you have a look at the newsstand now it looks pretty amazing and vibrant.
Why is it important for magazines to work together to build confidence in magazine advertising?
My take on the advertising process is that 80 percent of the budget is most probably spent on digital and TV. So the 20 percent left over is the “cool stuff” that they can do with their budget, and channels that they’ll look at will be outdoor, radio and magazines. Magazines are massively segmented, so presenting a single magazine solution is not going to win that 20 percent of that budget. So to win that share from outdoor and from radio, you need to present an audience-led option. That means you actually need to package up a number of magazines to be able to compete audience wise with the other channels you’re competing with, so that’s why we need the publishers to work together, because if we can’t deliver an audience-led solution, then we’ll lose that share.
I think the challenge we’ve got as a category is post-Covid, and after the demise of Bauer, we saw a lot of our revenue moved into other channels that were traditionally magazine dollars. Now our focus is we really need to push the category first, and get dollars back into the magazine category.
What do you think the future holds for magazines?
I think you will see more brands coming in and out of the market. The old rules are broken, a new brand these days doesn’t need to be a weekly, monthly or quarterly – it could just be capitalising on a consumer moment, so like a one shot – get in and out really quickly.
So as a business we are responding to that, making the barrier to entry lower for publishers to get new brands to market because up until Covid we didn’t really see a lot of new brands for several years.
What about you? What spins your wheels about being at Ovato?
When Ovato asked me to run New Zealand, I did ask them “you know I’m not a printer right? I don’t have printing running through my veins” but they didn’t actually want a printer to run the business; it was really to help reposition the business. I guess for me it’s about using my skill-set to help reposition the business which is what we are doing.
I feel like if we can get that right with Ovato Publishing Services, then the print will look after itself.
For more information visit ovato.co.nz.