Media Advertising Strategies - PDF by ebg18336

VIEWS: 52 PAGES: 24

More Info
									NEWSPAPER ADVERTISING:
NEW PRICING STRATEGIES




    Newspaper advertising: New pricing strategies - 1
 This report is published as part of the READY project,
generously sponsored by: PubliGroupe, the Swiss-based
international advertising and promotion group; Telia, the
    Sweden-based international telecommunications
     company; WRH Marketing, the marketing and
 distribution organisation of Swiss-based WRH Walter
  Reist Holding AG, which includes the Ferag group of
 companies; MAN Roland, a leading world company for
newspaper production systems ; UPM-Kymmene, one of
 the world’s leading printing paper producers ; Unisys,
 one of the largest worldwide suppliers of information
                   technology solutions.




               2 - Newspaper advertising: New pricing strategies
Table of Content


INTRODUCTION .............................................................................. 5

POLITIKEN – A DANISH DAILY ....................................................... 7
  POLITIKEN’S HISTORY ..................................................................... 7
  INSIDE THE PAPER ............................................................................... 7
  AN ATTRACTIVE READERSHIP................................................................... 8
WHY THE QRP SYSTEM? .................................................................. 9
  HOW ADVERTISERS SEE NEWSPAPERS........................................................ 9
  THE AD LANDSCAPE ............................................................................. 9
  A NEW MARKET SINCE 1999 ................................................................ 10
  DEVELOPING THE SYSTEM..................................................................... 10
  THE OUTCOME .................................................................................. 10
THE QRP PROJECT TODAY ............................................................. 12
  WHAT ARE QUALITY RATING POINTS? ...................................................... 12
  DETERMINING THE VALUE OF THE FIVE CHOSEN PARAMETERS .......................... 13
  TWO WAYS TO SHOP FOR QRPS............................................................. 13
  MARKET REACTION............................................................................. 13
  IN-HOUSE REACTION .......................................................................... 14
  CONCLUSIONS .................................................................................. 14
QRP’S IT SOLUTION ...................................................................... 15
  THE QRP MANAGEMENT APPLICATION ...................................................... 15
  INTRODUCING THE SYSTEM ................................................................... 15
THE ORGANIZATIONAL ASPECTS OF QRP ..................................... 17
  ORDERING....................................................................................... 17
  INVOICING ...................................................................................... 17
  PLANNING ....................................................................................... 18
  CONCLUSIONS .................................................................................. 18
REVENUES AND MARKET SHARE IMPACT OF QRP ......................... 19
  RUN BY CUSTOMER VS. RUN BY PAPER ..................................................... 19
  NEGOTIATING PRICES ......................................................................... 19
  CONCLUSION.................................................................................... 20
QRP FROM THE MEDIA AGENCY POINT OF VIEW .......................... 21
  STRENGTHS OF THE SYSTEM .................................................................. 21
  WEAKNESSES OF QRP SYSTEM .............................................................. 21
  THREATS AND OPPORTUNITIES ............................................................... 21
  CONCLUSIONS ABOUT INTRODUCING QRP IN A MARKET ................................ 22



                           Newspaper advertising: New pricing strategies - 3
IS QRP WHAT THE BIG ADVERTISERS WANT? .............................. 23

QRP AT OTHER NEWSPAPERS ....................................................... 24
 POLITIKEN’S CONSULTING SERVICES CAN INCLUDE ...................................... 24
 SOFTWARE SOLUTIONS ........................................................................ 24




  This report is based on a WAN one day executive seminar at Politiken,
                 September 2000, Copenhagen, Denmark.




                         4 - Newspaper advertising: New pricing strategies
INTRODUCTION

Most newspapers stick to tradition when it comes to pricing advertising.
They factor in the size of the ad, page placement and the number of
colors used, and out comes a standard newspaper rate card. But with
television eating a bigger and bigger piece of the advertising pie every
year, newspapers might consider revamping the age-old pricing system.

Danish newspaper Politiken has done just that. Instead of haggling over
space and discounts, Politiken ad sales teams now talk about value with
advertisers. More precisely, they discuss QRPs, or Quality Rating Points, a
unit of measure quantifying the reach of a particular ad placement.

Politiken has been testing the system for several months. Several other
Danish papers will join forces in 2001 to give the QRP system a go. What
is QRP all about? Does it live up to its hype? Most of all, could it be right
for your newspaper?




                     Newspaper advertising: New pricing strategies - 5
6 - Newspaper advertising: New pricing strategies
POLITIKEN – A DANISH DAILY

Politiken is one of the largest Danish dailies, with a market reach of 12%
or 546,000 people and a circulation of approximately 140,000. It is owned
by A/S Dagbladet Politiken Mediagroup, which publishes another daily,
Ekstra Bladet, and 15 free local papers. The parent company, which is
87% controlled by the Politiken Fonden, a trust fund, is active in the book
publishing business, new media and has a yearly turnover of around 1.5
billion kroner.


POLITIKEN’S HISTORY

Herman Bing, Edvard Brandes and Viggo Horup founded the newspaper in
1884. The three were well-known writers and members of Copenhagen’s
cultural radical movement. Politiken remained closely tied to Denmark’s
Social Liberal Party until the 1970s. “We aren’t connected to any party
today, but we have kept a social liberal bent,” says Merete Eldrup,
Politiken’s General Manager for Sales and Marketing. Editorially, Politiken
is critical of the government, provides background and analysis, with a
keen focus on culture.


INSIDE THE PAPER

The paper’s A section features national, international, business, celebrity
and sport news with some humor on the back page. The B section is for
cultural and opinion pieces, with news, features and reviews from all areas
of culture and the arts. Editorials, letters to the editor and op-eds appear
on the main pages of the B section.

Politiken breaks down the week with four light editions of up to 48 pages
and three heavy editions of up to 70 pages. They are light when most
readers are working Monday to Thursday and heavy Friday, Saturday,
Sunday. “People are busy on weekdays with only limited time to read the
paper,” Eldrup says. “That’s why we keep the paper tightly edited, even
though we still have specialized C sections on sport, travel, business or
the internet during the early part of the week.”

The Friday paper helps readers plan for the weekend with a guide to what
is going on in Copenhagen and articles about films, Eldrup says. “The
Saturday edition is family-focussed, with stories about the family, children
and books, while the Sunday edition is for reflection and entertainment
with background pieces, stories on style and the media.”




                     Newspaper advertising: New pricing strategies - 7
AN ATTRACTIVE READERSHIP

Politiken readers are attractive for advertisers. They are well educated,
earn high incomes and are most often city dwellers interested in the arts
and culture. Many of them work in the public sector and are involved in
civic life. The male/female readership ratio is around 50/50. “All and all,
approximately 25% to 30% of the space is devoted to advertising,
excluding classifieds,” Eldrup says.



Merete Eldrup
General Manager, Sales and Marketing
Politiken
Tel: 45 33 11 85 11
Fax: 45 33 12 12 04




                    8 - Newspaper advertising: New pricing strategies
WHY THE QRP SYSTEM?

Denmark is a very competitive media market. The country of five million
has five major daily newspapers covering the national scene and many
other dailies featuring regional or local coverage. In addition, three major
commercial television stations, TV2, TV3 and TV Danmark share in the
advertising market. “These are our main competitors,” says Henrik
Borjesson, Politiken’s Sales and Marketing Director.

The print media lost market share to television during most of the 1990s.
“Television stations have lowered their advertising rates every year for the
last five years,” Borjesson says. And with the development of cable and
satellite television in Denmark, new television stations are popping up
every day. Danish households now have access to between 30 and 40
channels.


HOW ADVERTISERS SEE NEWSPAPERS.

“Advertisers haven’t been putting newspapers on top of their agenda for
some time now,” Borjesson admits. Newspapers suffer from a poor image
because they haven’t developed in the last 100 years. Dailies are seen as
expensive and rather non-flexible.

“Advertisers perceive newspapers a little like dinosaurs spending time
fighting each other rather than developing new products and joining forces
against other media groups, such as television, outdoor advertising or
radio,” Borjesson argues. But some of this is changing. Last September,
Denmark’s dailies joined forces for an advertising project to be launched
in 2001.


THE AD LANDSCAPE

Two large groups dominate the advertising market: Dagbladene GEFION
and Metropol.

The top five or six media agencies in Denmark have been gaining in
influence over the last decade. “They are now handling over 70% of the
campaigns from the large advertisers,” Borjesson says. “They tend to
focus on the television media, prices and discounts.” They are also very
keen to evaluate the effects of their ads.




                     Newspaper advertising: New pricing strategies - 9
A NEW MARKET SINCE 1999

Before 1999, the Danish advertising market was anything but free. Prices
were fixed and included a 15% handling fee for media agencies. But the
government ruled these conditions illegal on competition grounds. Starting
January 1 st 1999, new rules took effect. They called for negotiated prices,
discounts, added benefits and a handling fee of 2%.

The new market conditions made negotiations for yearly agreements
much tougher. They heightened the influence of media agencies and big
advertisers. They began demanding research to prove the effect an ad
appearing in the paper might have, Borjesson says. “They said they
wanted to buy target groups just like they do in television.” They also
wanted guaranteed readership.

These new market conditions made newspapers appear even more old-
fashioned and more rigid than in the past - not to mention very
expensive.

At that time, Politiken had the highest number of text pages and classified
ads of the three main dailies. Management was keen to improve the
newspaper’s market share. “So we decided to listen to the market and try
to develop something new in order to put newspapers back on the
agenda,” Borjesson recalls.


DEVELOPING THE SYSTEM

Politiken started by talking with media agencies during the yearly
negotiating phase between January to March. By April 1999, the paper
had established a project group, which held meetings with the five largest
media agencies from May to August. With the media agency responses in
hand, the Politiken team devised the Quality Rating Points system, or
QRP, from August to October and started talking to advertisers about it in
December.


THE OUTCOME

Politiken didn’t apply the system to all its advertising clients right away.
Five major advertisers represented by the five largest media agencies
agreed to test the system first beginning in April 2000. During the test
phase, two advertising systems function side by side. “We currently have
two rate cards: the traditional one and the new QRP system for those five
advertisers,” Borjesson says.




                    10 - Newspaper advertising: New pricing strategies
QRP is good for large advertisers, but maybe not appropriate for all types
of advertisers. “Our traditional price list is bound to survive alongside the
QRP system,” Borjesson says.



Henrik Borjesson
Sales and Marketing Director
Politiken
E-mail: Henrik.Borjesson@pol.dk




                    Newspaper advertising: New pricing strategies - 11
THE QRP PROJECT TODAY

Politiken is still testing the QRP system with five major clients. These are
telecom group Tele Danmark, financial companies Danske Bank and
Nykredit, electronics retailer Fona and Sung og Baelt, the company
responsible for operating the new bridge connecting Denmark to Sweden,
among others. “The bridges are funded by tolls and that’s why they need
to advertise,” says Poul Melbye, QRP’s Project Manager. “It’s a little bit
like Eurotunnel and the Eurostar.”

Now that they have decided to test the QRP system, Politiken no longer
discusses discounts with these five clients. Instead, they negotiate the
QRP price. Most market players realized that the goal of the system was
not to lower prices, but to price advertising more effectively.


WHAT ARE QUALITY RATING POINTS?

The QRP system tries to get the price of an ad to best reflect its true
value. For this, Politiken had to reorganize the way it spoke with
advertisers. Because under the QRP system, Politiken isn’t selling space;
it’s selling contacts. “We had to change our way of thinking because we
have been selling space for 100 years,” Melbye says. “We had to translate
what were selling to match what advertisers were interested in buying –
that is, contacts.”

The QRP system creates a new currency based on readership figures. The
points are based on reach, corrected by a quality index of insertion. “That
means QRP integrates quantifiable dimensions known to impact the effect
of an insertion,” Melbye explains. The dimensions are limited to those
which are under a newspaper’s control. The creativity or attention-
grabbing quality of a particular ad isn’t factored in since it doesn’t depend
on the newspaper. However, the day the ad appears, its size, its colors,
the page it appears on and its probability of reaching its target group all
determine the QRP price. These indices are given a rating of 100 if they
are average, less than 100 if they are below average and over if they
demonstrate higher than average qualities.

For example:

-Target group: Men 29-50                      =   13.1% reach
-Size: Half tabloid, one color                =   Index 72
-Page: Sports in first section                =   Index 94
-Day: Saturday edition                        =   Index 115



                     12 - Newspaper advertising: New pricing strategies
How many QRPs?          (13.1 x 0.72 x 0.94 x 1.15)= 10.2 QRPs


DETERMINING           THE        VALUE            OF       THE           FIVE   CHOSEN
PARAMETERS

To determine the objective value of the five parameters, Politiken did a
thorough page traffic survey. The paper had 2333 people interviewed by
Gallup/Taylor Nelson Sofres thanks to computer assisted telephone
interviewing. “We chose that number of interviewees because we wanted
our data to be comparable to the data television stations provide,” Melbye
says.

Since readership figures weren’t broken day-by-day, Politiken relied on
circulation numbers. Index 100 became the average circulation from
Monday to Saturday.

In the case of size and color, Politiken chose the tabloid size as the
average. There is a general acceptance that a larger ad with more color
generates more interest. But since the research produced no definite
conclusions on the relation between size, color and the propensity to
notice an ad, Politiken continues to use the same prices as it does on its
traditional rate card.

Politiken also assigned a value to the different sections in the newspaper.
“The results showed that the front page should be worth 160, the national
pages 117, the international pages 100 and the business pages 88,”
Melbye says. “These results can also be broken down according to sex or
age for specific target groups, such as men and women over 50.”
Assigning a definite index to each page number proved problematic
because the A section might be 12 pages long on one day, and 48 pages
long on another.


TWO WAYS TO SHOP FOR QRPS

Politiken offered its clients two ways to shop for QRPs. Advertisers can
either decide where they want to put the ads and pay according to the
amount of QRPs the desired spots merit. Or they can let the paper decide
where to place the ad. If the ad is run by the paper, the customer orders a
number of QRPs in a specific target group and Politiken decides where to
put them.


MARKET REACTION

Clients consider the QRP system to be the best improvement the market
has seen in a long time. Even though only a few agencies are trying it, a
lot of publicity has come out of the trial. “It makes us look like the good


                    Newspaper advertising: New pricing strategies - 13
guys and has improved our dialogue with the agencies,” Melbye says. As a
result, print is getting more attention from the agencies and advertisers,
including ones not currently testing the QRP system. “We can see this in
the number of people agencies have assigned to work in print; they’re one
the rise,” Melbye notes.


IN-HOUSE REACTION

Though the project has generated a lot of positive attention within
Politiken’s ad sales department, QRP was still difficult to introduce within
the company. “You have to remember that when we walk inside the door,
100 years of tradition are weighing on our shoulders,” Melbye says. “We
clearly underestimated the changes that would have to be implemented
within Politiken’s organization.”

The introduction has had a great impact on all aspects of daily procedures,
going from the initial order handling to the technical requirements of the
new system.


CONCLUSIONS

Despite all the research, Politiken found old habits were tough to break.
Advertisers still prefer page three to any other page. It has been difficult
to convince them that two ads in the sports section are just as good as
one ad on page three. However, some other preconceived notions have
been breaking down. “We have found we could expect changes in
advertiser behavior we hadn’t even dreamed of,” Melbye says. “For
example, we were able to get them to place an ad on the left side pages
without much fuss.”



Poul Melbye
QRP Project Manager
Politiken
E-mail: poul.melbye@pol.dk




                    14 - Newspaper advertising: New pricing strategies
QRP’S IT SOLUTION

Introducing QRP to a newspaper calls for some key technological changes.
Danish IT firm NetCompany has created the first QRP management
interface and is working on improving its prototype.


THE QRP MANAGEMENT APPLICATION

The QRP application is an independent front system that works alongside
traditional newspaper systems. It requires only limited changes to the
existing IT infrastructure. It is also capable of handling several
newspapers at a time and comes in a web-enabled version that can be
accessed from wherever customers may be, says André Rogaczewski, a
NetCompany partner

Its architecture includes several key functions such as registration,
calculation, error handling, integration to new or existing systems and
banking. Banking is one of the most important ones since it involves
invoicing, error management, account management and manual change
control. “The application needs to act like a banking service because
clients have a QRP account,” Rogaczewski says. “And when you have
credit in an account like that, you are more likely to go shopping.”


INTRODUCING THE SYSTEM

The QRP management application arrived at Politiken’s offices in June
2000. Agencies were initially given a stand-alone computer on which to
simulate QRP orders before faxing them to Politiken. They have now been
equipped with web-enabled applications. “But now the challenge is to
bring other newspapers into the fold, so we have to move the main
computers from Politiken to a central location,” Rogaczewski says.

Adopting the new system requires time and energy for all those involved.
In addition to the time and expense spent teaching staff how to use the
system and testing it, newspapers need to define price sensitive
parameters to configure the system for clients. Customers also need to
spend time practicing and simulating order placement on the QRP
application to become familiar with it.

Customers enter the system with a logon name. They then select the
company they represent from the advertisers’ window and the specific
company branch the advertisement is for from another window.
Customers can then see their account, with the number of QRPs credited.
They can also choose a specific advertising campaign, look at the status of

                    Newspaper advertising: New pricing strategies - 15
the campaign and check other information such as whether it is run by the
newspaper or by the customer, how many insertions have been made and
the price of these insertions. “By the press of a button, customers can
choose the size of a new insertion and calculate the price to be paid,” says
Steffen Braa Anderson, a Senior Consultant at NetCompany. Specific ad
details such as color, date and theme can also be selected.

The system is still undergoing some improvements, Anderson says, but
that should be taken care of this fall. The system is expected to be fully
operational on the web before long.



André Rogaczewski                                  Steffen Braa Anderson
Partner                                            Senior Consultant
NetCompany                                         NetCompany




                    16 - Newspaper advertising: New pricing strategies
THE ORGANIZATIONAL ASPECTS OF QRP

Implementing QRP constitutes a real shift from traditional newspaper
practices. The system has already had an impact on the day-to-day
organization of Politiken’s advertising sales department.


ORDERING

QRP completely changes traditional ordering methods. Sales people must
move from thinking in terms of insertions to thinking in terms of
campaigns and editorial sections. This is new to staff within the
newspaper. “The adaptation time is much more significant for people
working within the newspaper than for the media buyers because people
at agencies have been seeing this for years in television,” says Paul
Melbye, Politiken’s QRP Project Manager. “All the people at the media
agencies have to do to get some useful pointers, is go down the hall to
their colleagues responsible for television.”

The ad placing process sometimes complicated by the fact the number of
pages in each news category vary depending on the day. “If there aren’t
enough national pages one day you have to call the client to tell them to
wait, or consider putting the ad in the international news section which
has a similar target market,” Melbye says.

The introduction of QRP also required new ordering procedures because
traditional order forms weren’t appropriate. “That’s because in Denmark,
we have standardized order,” Melbye says. Politiken began by handling
the orders manually, but has now integrated this function into the QRP
software. That means media agencies are now the ones filling in the forms
by computer. Politiken sends a confirmation to make sure all the
information collected is correct.


INVOICING

Politiken began by invoicing manually, but has now partially integrated the
function into the QRP software. Problems regarding invoicing between
different newspapers have yet to be resolved, but Melbye says these
result more from the issue of financial transactions than the functionality
of the QRP computer system.




                    Newspaper advertising: New pricing strategies - 17
PLANNING

Planning is another key feature of the QRP system, but is still only
partially used. For now, program users launch a simulation on the
software, but most of the planning is still done in traditional fashion. The
function will have to be improved once other advertisers join the QRP
system.


CONCLUSIONS

The QRP system has already had a sizeable impact on the work methods
of Politiken’s advertising sales department. The impact will be even
greater once more advertisers are using the system.

Once QRP becomes a common solution for all newspapers, advertisers will
be able to access all media via one website and do all the administrative
aspects of ordering through the Internet. A jointly-owned company or
professional organization could run the central website.



Poul Melbye
QRP Project Manager
Politiken




                    18 - Newspaper advertising: New pricing strategies
REVENUES AND MARKET SHARE IMPACT OF QRP

Though it is far too early to make any definitive judgements on the
effectiveness of the QRP system, some preliminary observations can be
made from Politiken’s experience.

Firstly, three of the five test advertisers increased their yearly spending at
Politiken in 2000. “But this isn’t just the result of QRP,” says Henrik
Borjesson, Politiken’s Sales and Marketing Director. “Some of that is the
result of broader market trends.” However, the remaining two advertisers
have lowered their spending by approximately 4%.

After adding all the revenue collected from the QRP system, Politiken has
found that the price of advertising per column millimeter has remained
stable.


RUN BY CUSTOMER VS. RUN BY PAPER

Test advertisers have mostly chosen the “run by customer” option up until
now. By and large, customers are still partial to the A section. That means
that most of the “run by customer” inserts will be in the A section.

In the case of “run by paper” inserts, ads are more likely to be spread
throughout the paper. “Run by paper” campaigns give the newspaper
more latitude in planning the paper,” Borjesson says. But clients continue
to prefer the “run by customer” option even though it might end up
costing them more per column millimeter.


NEGOTIATING PRICES

Before negotiating prices with the test customers, it’s best to perform a
simulation of the year ahead, by using the previous year’s advertising
spending. The newspaper must then calculate the amount of QRPs the
customer would have used during the previous year if the QRP system
have been in place. To get the exact price of one QRP for a specific
customer, one must divide that customer’s total yearly spending by the
number of QRPs that would have been used if the system had been in
place.

The newspaper should then calculate the price to charge for all
readership, factoring in discounts offered under the traditional pricing
system. A strength or weakness in a specific target group should also be
noted and compared with that of the main competitors.




                     Newspaper advertising: New pricing strategies - 19
CONCLUSION

The average price advertisers pay for a column inch is likely to fall under
the QRP system, but total revenues are likely to rise, says Borjesson.
“Revenues rise because you are able to fit more ads in the paper by
spreading them out in the various sections.”

The greater the number of “run by paper” campaigns, the greater the
expected fall in average column millimeter. But when evaluating the
system, it’s best to focus on the size of the yearly agreement, the market
share and the QRP price rather than obsessing about the average price
per column millimeter, Borjesson says.

This particularity of the QRP system may alter a newspaper’s market
share however. Danes are used to measuring market share in terms of
column millimeters. But “run by paper” campaigns tend to skew those
figures downwards. “That means we need to start measuring market
share in QRPs,” Borjesson says. “We have a challenge ahead of us.”



Henrik Borjesson
Sales and Marketing Director
Politiken




                    20 - Newspaper advertising: New pricing strategies
QRP FROM THE MEDIA AGENCY POINT OF VIEW

Einer Nicolaisen is the Print Director at the Initiative Universal Media
agency. He says QRP is a step in the right direction because it allows
media agencies to make more effective advertising plans - but that it’s no
gold mine.


STRENGTHS OF THE SYSTEM

QRP allows agencies to plan their print campaigns more rationally. “It’s no
longer about advertising in specific paper because it’s the one you read at
home or because your cousin works there,” Nicolaisen says.

The introduction of the new system at Politiken has also changed
mentalities within the media agencies. Suddenly, it’s sexy to work with
print again, he says. QRP also has the potential to generate more value
for clients, which can only be a good thing.


WEAKNESSES OF QRP SYSTEM

There is a perception among media planners that QRP will give them more
work. “Their attitude is basically “we want one system, the one we know,”
Nicolaisen explains. In addition, agencies aren’t as prepared as they
pretend to be. Remember, QRP is only one of the many systems they
have to master, since they collaborate with a variety of media outlets, he
adds.


THREATS AND OPPORTUNITIES

Under a QRP pricing system, newspaper sales teams spend more time per
account and move far beyond the role of order taker. It also develops the
print planning discipline a little more. “With QRP, you actually have to
think, not just buy,” Nicolaisen says.

Politiken’s new advertising system also provides better research. Media
planners need as much empirical research as they can get to help them
better evaluate the relationship between investment and effect.

Threats to the further development of the QRP system include the ambient
conservatism in the industry. Added to this, is the fact there are several
different systems operating in the market at the same time. “It’s difficult
to use QRPs as a currency if too few people are using them,” Nicolaisen
notes. Furthermore, clients may not want to pay for the extra hours of
work planning a QRP campaign may require.


                    Newspaper advertising: New pricing strategies - 21
CONCLUSIONS ABOUT INTRODUCING QRP IN A MARKET

Introducing QRP in a market requires ongoing commitment from agencies.
“At the beginning, make sure there is something in it for the agencies,”
Nicolaisen says, “there must be some kind of incentive.”

The system should first be tested by a few clients and communication with
them should be ongoing. In order to avoid having a variety of different
systems on the market, it’s good to cooperate with competitors so that
everyone is speaking the same language.

In short, QRP is no panacea, but it helps, by getting advertisers involved,
allowing for better media plans and making sure the biggest number of
people targeted get to see the ad.



Einer Nicolaisen
Print Director
Initiative Universal Media




                    22 - Newspaper advertising: New pricing strategies
IS QRP WHAT THE BIG ADVERTISERS WANT?

QRP is most effective for large advertisers with ongoing advertising
campaigns such as Tele Danmark. The telecommunications group was one
of Politiken’s five test advertisers, but didn’t increase its yearly advertising
levels after the trial, as three of the others did. That doesn’t mean Tele
Danmark isn’t a fan of the QRP system, says Tim Boye, Tele Danmark’s
Marketing Director.

“With this system, Politiken has hit a bull’s eye by bringing a degree of
flexibility to the market,” he says. “It was difficult to move newspapers
away from the ‘but we have always done things this way’ attitude.”

Advertisers have been wanting to pay for what they get for a long time.
They have been telling newspapers this for years. The message fell on
deaf ears since there was no will to change. But the pressures from large
advertisers became too strong and it was clear it was time to more away
from long-established customs, Boye says. “QRP has now made
newspaper advertising a lot like television.”

QRP also made Tele Danmark a little more flexible. Politiken advertising
reps were able to get the company to accept having its ad on page eight
rather than on page three. “Because maybe page eight is actually better
for our target market,” Boye says.



Tim Boye
Marketing Manager
Tele Danmark




                     Newspaper advertising: New pricing strategies - 23
QRP AT OTHER NEWSPAPERS

Though QRP was developed in Denmark for the Danish market, it can
easily be applied elsewhere. “It can be applied to other newspapers or to
joint advertising groups,” says Poul Melbye, Poliken’s QRP Project
Manager. “And most countries will already have much of the necessary
market data available.”


POLITIKEN’S CONSULTING SERVICES CAN INCLUDE

Politiken can assist papers wanting to test the system by analyzing the
market data and helping them set up the quality index. It can help to
introduce QRP to others with seminars for newspapers, agencies and
advertisers. “We can also help with the actual implementation within the
sales department,” Melbye says.


SOFTWARE SOLUTIONS

Politiken can also provide the QRP system software created by
NetCompany, help integrate it with the existing infrastructure at the
newspaper and develop an accompanying website.



Poul Melbye
QRP Project Manager
Politiken




                   24 - Newspaper advertising: New pricing strategies

								
To top