Conference Welcome and Program Introduction David Algire, VP, Pegasus Sales, The Reader’s
Digest Association, Inc.; Conference Chair
Conference Chair David Algire welcomed attendees to the Retail Conference at the start of Monday’s general sessions. Referring to the Print Comes to Life opening reception the night before, Algire noted, “It was a fun way to literally feel the connection that publications make with consumers everyday.” He also outlined the agenda for the next two days, which included research relevant to the magazine and book category and retailing, editors who shed light on their publications’ connections to consumers, and retailers whose commitment to best practices on merchandising publications played a core role in their business models.
According to conference emcee Michael Clinton, who followed Algire, in this age of interruption, consumers are increasingly taking control of their media consumption. They are “choosing where, when and how they want to receive their information,” he said. And in this daunting environment, where television ads are being zapped, satellite radio is enjoying a surge in subscribers, and commercial-free iPods are the rage, magazines—and their retail partners—have a tremendous opportunity to promote magazines’ unique connection with consumers. Clinton stated that research has shown how readers value advertising in magazines, and that magazines ads have moved consumers to action at retail. He also talked about the millions of copies of magazines and books being sold on the newsstand, a sign of consumers’ continuing passion for the printed word. Clinton hoped that the conference sessions will help magazines and retailers work better as partners to tap into that passion, and to develop innovative ways to merchandise and sell magazines and books. Keeping Pace with the Changing Consumer J. Walker Smith, President, Yankelovich Partners, Inc.
J. Walker Smith spoke about the “mainstreaming of affluence”—a
world in which “used” becomes “vintage,”
“sales clerk” becomes “sales consultant,”
and “lettuce” becomes “field greens.”
This unprecedented phenomenon of public prosperity has changed
the expectations of ordinary people—experiences that were
once limited to only the rich are now commonplace. Smith also provided insight on the growing importance and vitality of multicultural markets, citing Tiger Woods’s “Cablinasian” (a conflation of Caucasian, Black, American Indian and Asian) in reference to the fact that he’s not just an African-American. The future of America looks like Tiger Woods, and to reach the multicultural consumer, Smith said, it is imperative that marketers target attitudes, not traditional demographics. There has also been a profound shift from “cocooning” to “bee hiving.” In a cocooning environment, the consumer wants to retreat from the world, disconnecting oneself from society. However, consumers are increasingly moving towards “hiving,” which, like a bee hive, represents engagement with the outside environment. Hives have larger, open gathering areas that lead to exposure and interaction with a diverse community. Understanding the attitudes and values of increasingly diverse markets provides new opportunities for strengthening consumer relationships and improving marketing initiatives. Multicultural Readers: The Editors’ Scoop Raymond Roker, Publisher and Creative Director,
URB, and President, NativeSon Media, Inc.
Raymond Roker discussed how URB came into being 15 years ago, saying it was “an outlet of what [he] was into at the time. It came out of a lifestyle,” a lifestyle that included music, culture and art of the city. Roker attributes the success of URB to its credible, authentic voice. The core qualities of URB, its “DNA,” according to Roker, include independence from a parent company; multicultural founders; it documents the culture of alternative urban music; it’s not created from the “outside looking in”; and it opens minds, bringing new experiences to URB’s readers. Some of the current challenges URB faces include its increasing number of competitors, staying cool as the staff matures, and fragmentation of the media and retail. URB stays authentic by maintaining core values, branding through core events, observing underground trends and influences, subscription growth through cooperative promotion, offering free “tastemaker” copies to retail outlets where URB’s core influential readers shop, and by conducting research.
According to Betty Cortina, language is not the way to connect to the Latino community. “You’d think connecting to Latinas is through language…but language will not be the most important factor in the future. Culture will be,” she said. The Latino community is changing tremendously. They will have been educated in English and live in the larger English-speaking culture, and even speak English better than the Spanish that was spoken in their homes. Their home is filled with a strong sense of culture and language. They will feel 100% American and 100% Latina. Latinas have a sense of identity that incorporates both cultures fully, and they do not feel like they have to give up either of them. According to Cortina, Latina connects to its readers through culture primarily in three ways:
Retailers Stay Connected: Bashas’ Inc. Mark Barnett, SVP of Merchandising, Bashas’ Inc.
Mark Barnett discussed the importance of understanding how to market to the changing face of the American consumer. He explained that Bashas’, a Phoenix-headquartered company, caters to four distinct markets. They have 59 Food City stores, which target the Hispanic market; 10 Bashas’ Diné connecting to the Native American market; 11 AJ’s Fine Foods catering to an upscale community; and 73 Bashas’, a conventional supermarket. Barnett described Bashas’ dedication to respect and understanding allows the company to connect with each of tis target markets. He stressed that employees, including senior executives, are encouraged to learn Spanish to better communicate to the customer. He also explained that Food City provides free transportation for customers spending $25 or more worth of purchases. Magazines function as a major part of Bashas’ Inc. overall organizational plan to effectively communicate and market to their different consumers. “Magazines are a very important category in all our formats,” said Barnett. Providing a diverse group of titles geared towards various markets further helps Bashas’ engage the customer. The strong focus on maintaining a customer-driven process, empowerment store teams with decision-making authority, and celebration of the uniqueness of different niches are all reasons why Bashas’ Inc. is a best practice leader at retail. Retailers Stay Connected: Barnes & Noble Mitch Klipper, COO, Barnes & Noble, Inc.
Mitch Klipper of Barnes & Noble, the nation’s third largest retailer of magazines, discussed the importance of factors like exclusive store content design, ambiance and architecture in the company’s successs. “Barnes & Noble has become a destination and a gathering place,” said Klipper. The company is the world’s largest bookseller with 835 stores in 50 states. He stated that last year, the company sold 1.1 million unique book titles. Additionally it sold more than 5,000 magazines covering 250 categories. Klipper noted that magazines get some of the best real estate in their stores. The carefully designed large magazine racks, in addition to the coffee shops, encourage traffic and improve store ambiance. Architecturally, B&N aims for unique design in each of its stores. The company also creates exclusive books like Barnes & Nobles Classics with newly commissioned introductions by experts. “We’re connected to our customer,” stated Klipper. Transforming Consumer Connection into Retail Success Greg Stielstra, Senior Marketing Director, Book Group, Zondervan
The force behind the phenomenon “The Purpose-Driven Life,” Greg Stielstra of Zondervan discussed the marketing strategies that led to the book’s success. Stielstra explained how he used an “anti-mass marketing campaign” that challenged conventional definitions of developing a bestseller. “Set aside your assumptions about book marketing,” he requested. “The Purpose-Driven Life” sold over 21 million copies since its release in October 2002 and remained on The New York Times bestseller list for over 100 weeks. Stielstra explained the four important steps to his marketing plan, which he coined "Pyromarketing”:
Appeal to the Heart: How to Improve the Shopping Experience Michael Sansolo, SVP, Food Marketing Institute
The supermarket's declining share of business indicates that it hasn't kept pace with consumer needs, Michael Sansolo informed conference attendees. The purpose of his speech, he stated, was to look at what's happening inside the mind of the supermarket shopper. Sansolo pointed out that industry growth is slow and that 20% of consumers no longer go to the supermarket. "We're losing the shopper," he warned the audience. He described the nine different types of shopper states of mind: the budget shopper, the discovery shopper, the immediate consumption shopper, the efficient stock-up shopper, the care for family shopper, the bargain shopper, the small basket grab-and-go shopper, the reluctant shopper, and the specific item shopper. These types of shoppers are described in the Coca Cola Retailing Research Council 2004 study "The World According to Shoppers," which is available online at http://www.ccrrc.org./app/home/portal/_pagr/109#1/ The study also found that the food shopping experience is becoming polarized. "You've got to serve an end of the market and not the middle where there are fewer shoppers," Sansolo advised. "Clear positioning produces a better experience."
Bill Bishop emphasized that magazines play an important role
in enhancing the shopping experience. He said there were a number
of ways magazines could improve the shopping experience for consumers.
As an example, he said that baby magazines should be displayed
where baby products are sold, or display men's magazines where
men's products are sold. How “The South Beach Diet” Built Business for Retailers Cindy Ratzlaff, VP, Associate Publisher, Rodale
Books
Cindy Ratzlaff of Rodale Books, publisher of the bestselling phenomenon “The South Beach Diet,” likened their experience with the book as climbing a hill on a giant roller coaster, and still not seeing the downside. Indeed, in two years, “The South Beach Diet” has captivated the American public, and, in Ratzlaff’s words, “is now changing the way the world eats.” Ratzlaff gave a brief history of the diet, which was the brainchild of cardiologist Dr. Arthur Agatston, who explored healthier ways of losing and maintaining weight as a service to his patients. The result—the South Beach Diet, which, as it gained more popularity, led to Rodale’s publication of the book. The book received full marketing support from Rodale, and it has since enjoyed a coveted spot on The New York Times bestseller list, currently for 93 consecutive weeks.
Following Ratzlaff’s presentation, Howard Brandeisky shared Kraft’s mission: “to help people around the world eat and live better.” In light of this, he believes that the South Beach Diet fits perfectly with Kraft’s overall health and wellness initiatives—allowing consumers to lose/manage weight through the consumption of “the right carbs, the right fats, and lean sources of protein.” He also remarked that “the biggest area of consumer interest is probably weight management”—a business that already represents more than $20 billion in sales and is growing. Many of Kraft’s existing products fit the principles of the South Beach Diet, which has led to the development of flags or buttons on those products stating “South Beach Diet Recommended.” But to build on that, Kraft will launch a new line of South Beach Diet foods during spring 2005, coinciding with the debut of the very first paperback edition of “The South Beach Diet.” Tie-in promotions between these products (which include meal replacement bars, sandwich raps and dinner entrées), in addition to the publication of related South Beach Diet books, should help the both brands increase worldwide recognition and retailers boost sales. Magazine Marketing Coalition Michael Clinton, Hearst Magazines
Ed Kelly presented information about the Magazine Marketing Coalition,
a group publishing companies and allied industries, including
paper and printing companies. Through the three-year, $40 million
marketing effort, the Magazine Marketing Coalition’s goal
is to raise awareness about the powerful relationship consumers
have with magazines and help magazines gain a larger piece of
the media pie
Michael Clinton continued the presentation by describing the campaign Fallon New York has developed. The core campaign uses the future as a device to show that even in a world where technology intrudes further into our lives, consumers will always engage with magazines. The campaign’s tagline “Read On” reinforces the campaign’s message: no matter how things change, people will still turn to magazines. The ads began appearing February 28, in advertising and trade media press and national newspapers, including The New York Times and The Wall Street Journal. The ads include the Magazine Marketing Coalition’s website: www.magazine.org/readon. Another element of the program is the creation of “faux covers.” Fallon New York is working with magazine editors to develop magazine covers of the future for their title that will be wrapped around complimentary copies of magazines. The wit and humor of the faux covers will delight and surprise, and will be sure to generate response. Weekly magazine covers began debuting in early March, and monthly covers will start appearing on May issues. 2005 Annual Industry Dinner
On Monday evening, the Second Annual Industry Dinner was held beneath the stars on the Squaw Peak Lawn of the Arizona Biltmore. This special event, sponsored by national distributors, publishers, wholesalers and suppliers, was a message of unity to retailers. The evening’s theme was the Wild West, featuring a wide variety of activities and attractions, including a live country band, tomahawk throws, quick-draw shootouts, and a mechanical bronco.
Sponsors included: Advance Magazine Group; BusinessWeek; FHM/EMap; Gruner + Jahr USA; Hachette Filipacchi Media U.S., Inc.; Hearst Magazines; Ingram Periodicals Inc.; Meredith Publications; Newsweek; Reader’s Digest; Rodale Inc.; Ziff Davis Media; Comag Marketing Group; Curtis Circulation Company; Kable News Company; Random House; Time Inc. Retail Sales & Marketing; Distribution Services, Inc.; Magazine Publishers of America; Source Interlink Cos. (Fulfillment Division); Anderson News Company; Chas. Levy Circulating Company; Consumer’s Union; Dennis Publishing, Inc.; Kappa Publishing Group, Inc.; National Geographic; Playboy Enterprises, Inc.; The News Group USA; and TV Guide Magazine Group Inc. |
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