August 1, 2006 Nadia Chiesa

Too High a Price

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Yes, magazines are facing increasing pressure to meet advertiser demands. So far there's no threat to their integrity, say some editors yet

Last September, after less than a year on the job, Kim Pittaway resigned as editor-in-chief of Chatelaine, citing editorial interference from publisher Kerry Mitchell. Although there was no particular dispute that prompted her resignation, Pittaway says she had growing concerns over advertising issues. “I inevitably ended up negotiating into programs and approaches that I was not entirely comfortable with,” she says. Within weeks of Pittaway’s departure, Janice Paskey was fired as editor of Calgary’s Avenue magazine and editorial control was again a major issue. “I lost, totally, my editorial authority to a sales director,” says Paskey, adding that the magazine’s sales director was allowed to approve story lineups, pull stories, edit copy and dictate content so as not to offend advertisers.

Pittaway’s and Paskey’s common fate symbolizes the renewed assault on the separation of editorial and advertising in the magazine industry. “Church and state,” as it’s known, has always been a concern because of the implied threat to the credibility of editorial content. But over the past year, the line has become even more blurred. Advertisers, knowing magazines remain an effective way to reach consumers, have increased their efforts to influence editorial content by playing publications against one another and making greater demands. Those who used to be satisfied with good placement and advertorials now want their brands to be associated with the magazines and want mentions in editorial copy. Revenue-hungry magazine publishers, meanwhile, oblige this growing incursion in two ways. One is to draw editors closer to the business side by making editors and publishers one and the same. Another is to restructure the magazine masthead’s traditional order so that advertising sales managers have more power. As church and state become entwined, the risk grows that magazines will lose credibility with readers by compromising the integrity of editorial content. Many in the industry worry that publishers may be pocketing the short-term gain of higher ad revenues in exchange for the long-term pain of reduced subscription renewals and smaller newsstand sales.

From May to October last year, Maclean’s, Rogers Communications Inc.’s flagship newsmagazine, published special features written by Peter C. Newman called “New Canadian Establishment.” The series was sponsored by General Motors of Canada’s Cadillac division, with the car’s logo appearing on the editorial feature. The arrangement raised more than a few eyebrows. “Brought to you by Cadillac means Maclean’s couldn’t bring it to you,” says Bill Shields, editor of Masthead, the periodical industry’s journal of record. And last July, Rogers’s top women’s title, Chatelaine, ran an eight-page bonus home decor section sponsored by Home Depot. The sponsor’s logo appeared alongside the magazine’s. The editorial content was produced by the magazine’s editorial team, while the advertising content was produced by the marketing team at Rogers. Editorial lineups were shared with Home Depot so the ads could be tailored to match editorial content. Both magazines breached Canadian Society of Magazine Editors (CSME) guidelines, which state: “An advertiser’s name or logo may not be used on any editorial pages to suggest advertising sponsorship of those pages, nor shall any editorial page be labelled as ‘sponsored’ or ‘brought to you’ by an advertiser.”

“Few advertisers will now say, ‘Sure, I’ll buy six pages in the magazine,'” says Canadian Business (CB) magazine publisher Deborah Rosser. “They’re asking, of all media, ‘How can I work with you?’ because we have the relationship with the customer they want to reach.” This approach has raised the stakes for publishers. Advertisers who used to divide their allotment of pages among several magazines will now give all their pages to the single magazine willing to provide the most integration. Though she won’t mention any names, Pittaway says that advertisers would approach Chatelaine with these kinds of proposals – and let the editors know they were competing against other Canadian women’s magazines.

What advertisers want is intimacy with editorial, and editorial teams are ever more receptive to negotiation, says Cathy Quinton, a media manager at ad agency Vickers and Benson. “Advertisers are always asking, ‘How can I have my product woven into the editorial or at least look that way?'” By doing that, Quinton says, they figure they’re building integrity for their brands.

These pressures have clearly changed the working environment at magazines. Traditionally, the editor has been responsible for content, while publishers have taken care of the business side – including negotiating the ad deals. Today, though, editors are immersed more than ever in the business side. Where in the past editors might have simply been introduced to advertisers or visited ad agencies, now they come to the negotiating table. This puts them in a position to be more involved in what happens in terms of advertising, but some fear it erodes the ability of editors to take an ethical stand. In addition, editors and their teams are being asked to use their expertise to help advertisers develop and shape their messages. “The time and resources that go into coming up with ideas for advertisers are time and resources taken away from coming up with ideas for readers,” says Pittaway, who has worked with companies such as Kraft Foods on its ad campaigns.

The chains of command at some magazines increasingly reflect the new culture. Rogers, for example, recently realigned its management structure so that sales directors report directly to the vice-president of sales instead of to their publishers. This means each publisher’s direct control is now concentrated on editorial, while jurisdiction over advertising has changed.

Also troubling to the industry is the tendency to combine the editing and publishing roles. Currently, Ken Whyte fills both positions at Maclean’s, as did Lise Ravary at the French edition of Châtelaine. Ravary describes her role as “brand champion” rather than merely a souped-up ad director. She claims there is no potential for conflict of interest. “I know where the line is,” she says. “I made the decision and I’m not fighting with anyone about it.” At the end of November, Ravary was promoted to VP editorial director of women’s titles and new magazine brands for Rogers, but she remains Châtelaine’s editor-in-chief.

Some think a closer relationship between editorial and advertising has its advantages. Rosser, who serves as publisher of Profit and MoneySense in addition to CB, says the editorial and advertising departments at her magazines get together to present each side’s ideas when planning upcoming issues. It allows the advertising department to understand the choices the editorial department makes and to package these ideas to sell to advertisers. “What we sell to the advertisers,” she says, “is the readership.” Jacqueline Howe, a group publisher at Transcontinental Inc., emphasizes how important it is for editors to be aware of the business side of their magazines. “If editors understand the financial aspects of the magazine, you’re going to have a much stronger product.”

Certainly advertisers understand there is a more fluid dynamic to the relationship. While many of them now gravitate toward interactive media and the Internet, magazines remain alluring and important vehicles. With the advent of TiVo and other personal video recording technology, viewers no longer have to sit through the commercials during their favourite television shows. At the same time, a growing segment of television audiences, labelled “light TV viewers,” watch little television and are very selective about what they watch. These same consumers, however, tend to be heavy magazine readers, which makes magazines still popular and appealing for companies looking to sell their brands.

But if consumers – a.k.a. readers – are the targets, no one is certain how they’ll react to the new closeness between advertising and editorial content. Some fear publishers are toying with a longstanding relationship that, once damaged, will be hard to repair. “Most successful magazines have a readership that has a strong element of trust in the content,” says magazine consultant D.B. Scott. “Integrity is all a magazine has. As soon as you do anything that breaks that trust, you’re basically screwed because readers are not stupid.”

Magazines Canada, the professional magazine industry association, is concerned enough with examples such as the Maclean’s and Chatelaine violations that it has organized the Ad-Edit Task Force to review the guidelines and suggest improvements and possible enforcement mechanisms to CSME. “We want the task force to find some way to encourage compliance,” says Patrick Walsh, chair of the task force and editor of Outdoor Canada, “which is a nice way to say give it some teeth.”

Still, it will be hard to turn back an onslaught that is international in scope, particularly when one of North America’s most venerable journalism institutions is leading the way when it comes to blurring the line between advertising and editorial. Late last August, The New Yorker published an entire issue sponsored solely by discount retailer Target Corp. The ads featured illustrations that resembled the magazine’s well-known artistic style. While they were emblazoned with Target’s red and white concentric circle logo, none of the ads carried the store’s name. The American Society of Magazine Editors (ASME) stipulates in its guidelines that any magazine issue sponsored by a single advertiser must print an explanatory letter from the publisher. Failure to comply with ASME guidelines can result in magazines being barred from the National Magazine Awards. Despite the fact that the New Yorker didn’t publish the required note, ASME has stated that the magazine won’t face any penalties from its organization.

Tension between advertising and editorial is a chronic condition in the Canadian magazine industry. Given their dependency on advertising revenue for survival, magazines have always made concessions. Advertiser requests for special placement in the layout – for which they’ve traditionally paid a premium rate – have long been commonplace. Certain advertisers have included provisos in contracts to ensure that their ads not be placed next to stories dealing with “issues” or featuring competitors. Some editors also give the advertising department a heads-up if a controversial story is coming, so advertisers can pull their ads from that particular issue. While she was editor of Homemakers, Dianne Rinehart says she would let the advertising department know if she was going to run a story on cancer, for example, so they could decide whether or not they wanted to solicit cigarette ads.

In recent years, tension has most often centred on advertorials – advertising insert material designed to look as much as possible like the editorial that surrounds it. Editors agree that the font, design and layout of advertorials shouldn’t resemble those of the magazine and should be clearly labelled as such. However, this isn’t always the case. Rona Maynard, former editor of Chatelaine, struggled for years to get the Dairy Bureau of Canada to put the word “Advertisement” on its advertorials. The Dairy Bureau, which made a practice of adapting its inserts to match a range of women’s magazines, eventually conceded to running a small logo on its Chatelaine inserts.

Beginning in 1997, Matinée Cigarettes placed advertiser-produced general interest articles in the now-defunct Elm Street magazine. The pieces were designed to look like the magazine’s editorial pages. The experience was “painful,” recalls then-editor Stevie Cameron. She says she received a significant number of negative responses from readers, most of whom, strangely, were not so much opposed to the advertorial content as to the fact that it was a cigarette company that sponsored it.

Advertisers have also teamed up with editorial teams to produce sponsored content. While he was editor at National Post Business magazine, since renamed Financial Post Business magazine, Tony Keller oversaw two editorial features that were sponsored: Canada’s Outstanding CEO of the Year awards, funded by Caldwell Partners International, and the Canadian Technology Fast 50 Awards, funded by Deloitte & Touche LLP. The companies conducted the research and nomination processes to determine who would receive the awards. They then turned the names over to the editorial team at the magazine, which produced the editorial package. According to Keller, the companies were not regular advertisers in the magazine, they generally didn’t receive ad pages in exchange and their logos did not appear on the feature. Conducting the research for the magazine allowed the sponsors to demonstrate their companies’ services to potential customers, that is, the readers.

Under Maynard, Chatelaine used to run an editorial package presenting the top one hundred women entrepreneurs in the country. Royal Bank of Canada agreed to sponsor the feature, but wanted its logo to appear on the article. Maynard refused. In the end, RBC ran an advertorial showcasing twelve of its successful female clients. This ran in the middle of Chatelaine’s feature.

The first major signal that this arm’s length relationship might be breaking down came in 1997 when Saturday Night printed an excerpt from Mordecai Richler’s novel, Barney’s Version. The words “Presented by Absolut Vodka,” were printed on both the contents page and the first page of the excerpt. Most tellingly, the final page played on Absolut’s signature ad. The copy was printed around the shape of the company’s vodka bottle and “Absolut Mordecai,” a twist on its slogan, ran beneath it.

While sponsored editorials that go this far remain relatively rare, they represent an advertiser’s dream come true. That’s because examples like Absolut Mordecai – as well as the more recent inserts in Maclean’s and Chatelaine – allow advertisers to insert themselves into the trusting relationship that exists between reader and magazine. “Hand in hand with that trust is the ability of the reader to relax about it,” says Scott, “and to say this magazine would never do something that would take advantage of my trust.” In other words, once advertisers have penetrated the relationship, readers will be more open to their messages.

Increasingly, on television news or on radio, with the exception of public stations, most programs are “brought to you by” or “sponsored by.” It seems as though everyone who depends on advertising to survive, in both journalistic media and arts industries, is selling out. “There is a new interest in more branded content,” says Mary Maddever, executive editor of Media in Canada and Strategy, both marketing magazines. Within marketing and advertising circles, she says, there is more of an effort to communicate the advertiser’s message to readers using the medium of content.

In the end, if readers do get more bang for their buck, as many on the marketing side claim, it’s difficult to weigh whether or not they really care who pays for the content. While the trend of sponsorship troubles editors, those on the business end of the magazine industry see it differently. For publisher Jacqueline Howe, advertising-driven content means added value for the reader. “It’s over and above what the reader would get in the normal editorial project,” she says. And, in categories such as fashion and beauty magazines, readers already look at the ads with interest, according to Maddever. She says “hybrid content” has the advantage of providing even more information to the reader. Tailored ad content also helps to build the brands of both the advertiser and the magazine, argues Rogers publisher Rosser. She says it lets readers know that the advertiser – and, by extension, the magazine – understands them. The magazine, even in the ads it features, provides readers with the information they want and need: “It lets the advertiser leverage the relationship the brand…” – the brand being the magazine – “…has with the reader in a way that’s meaningful for the reader.”

And what about the readers? The evidence so far suggests they don’t realize how much editorial and advertising are intertwined. Starcom USA, an agency that helps advertisers reach consumers, released a study last October finding that sixty-five per cent of readers believe advertisers pay for editorial mentions. And when Pittaway participated in an online forum with readers in the summer before she left, she said that many of the questions she fielded were related to advertising. The readers of Châtelaine have asked Ravary point-blank if advertisers pay for editorial mentions. Her response: “It never has been in forty-five years and it won’t be under my watch!” Yet at Outdoor Canada, Walsh receives letters from readers referring to articles as ads and vice versa. “Readers don’t always get it,” he says of the difference between editorial and advertising. “More than most editors would like to believe, readers think we’re selling editorial mentions on a regular basis.”

Faced with this confusion, many in the industry wonder what to do. Walsh says even though communicating with readers is priority number one, the industry previously has done a poor job of letting advertisers know about the organization’s standards of editorial integrity. In the U.S., ASME released a revised set of guidelines in October 2005, which addressed some of the concerns regarding the advertising-editorial relationship. The Magazines Canada task force continues to evaluate the CSME guidelines and compliance measures and plans to look at the need to educate the advertising community as well as the readers about editorial integrity.

Advertisers aren’t waiting for the results. They’re more concerned with pushing harder to get their messages out. And that continuing pressure poses a true conundrum for publishers: do they accept the additional ad revenues now even if the corrosion of the editorial product suggests that readers will be alienated in the long run? Many in the industry say blurring the line between advertising and editorial puts the relationship of trust in danger. The length to which a magazine is willing to risk this trust depends on the type of relationship it wants to cultivate. As Pittaway says, “What it comes down to is if you want to have a marriage forever with your reader or if you’re just dating.”