Rumors began swirling around the iPad, long before its official late-February announcement. Since that time, the world has basically divided into two camps: those who think the new tablet will change the world, and those who believe it's little more than an oversized iPhone.
Magazine publishers have generally fallen into the first camp, fawning over the sleek device and its potential to reignite reader interest in paid content and, ultimately, reinvigorate an industry that has seen more than its share of declines in circulation and advertising revenues. Some of the industry's heaviest hitters -- including Time Inc., Conde Nast, Meredith and Hearst -- already are planning digital storefronts from which to sell their tablet-version publications. Some publications, such as Men's Health, already offer an iPad edition, and others, like The New York Times, offer a selection of their print editions in tablet version.
It's no wonder, really, that publishers are gushing. Certainly the iPad has the potential to significantly boost circulation, which, for a typical magazine, makes up roughly one-third of the P&L. It's the other two-thirds -- advertising revenues -- that's the problem.
Many questions remain unanswered on exactly how advertising will be sold on this new medium. There has been much discussion on whether to bundle or not to bundle, for example. Amid such discussions, there is a deafening silence regarding what is arguably the most important advertising issue of all: measurement. What will the iPad and its cousins -- the Nook, Kindle, etc. -- provide in terms of reader engagement measurement?
It seems to me that Apple, Amazon, Barnes & Noble and the like never envisioned their devices as a means to an end for magazine publishers. The gadgets are built to sell books and magazines, and provide a richer, more dynamic experience for the reader. But this alone won't save publishing. In order for their tablets to be truly meaningful for publishers and advertisers, they must have the capability to provide deep reader engagement analytics. Only then will publishers have the proof needed to show advertisers the real value of their iPad edition and how it more deeply engages their readers.
For example, how long did the reader spend with the ad? What action did she take? Did she buy anything? What section of the magazine is the target customer spending time in and which performs best in terms of the advertiser's goals? Which creative resonates best and within which editorial sections? If one aspect of the ad is changed, how does that impact results?
Until such metrics are available, the tablet will continue to be purely a reach play for publishers. Unfortunately, that is precisely what I have heard among my colleagues in industry circles -- stories of "starter packages" being peddled to big-name advertisers with guaranteed distribution. Ugh. That is not good news, as the real value of the advertising will be ultimately undermined and lost unless it can be measured in a meaningful fashion. And with two-thirds of the P&L resting on advertising revenues, the iPad will have limited impact on the industry until a better yardstick is built.
Al DiGuido is CEO of Zeta Interactive. He can be reached at email@example.com.
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