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The New Marketing Helix: Ad Spending Splinters

It’s now clear the game isn’t as simple as keeping the share of a marketing budget for a magazine versus a Web site.

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with contributions from Stephanie D. Smith, Amy Wicks
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The first quarter of 2009 showed a brutal retrenching in print advertising, where 30 percent ad page declines weren’t unusual among many magazines that depend on fashion and luxury dollars. This followed Publishers Information Bureau data indicating magazine advertising had declined 7.8 percent in 2008 over the year before, with the apparel and accessories and the retail categories reflecting those cuts in similar proportions.

The slashing of marketing budgets has hit Web spending less, albeit the base is substantially smaller. EMarketer, a market-research firm, predicted earlier this year that online-advertising spending in America will increase by 8.9 percent in 2009, rather than the 14.5 percent it had forecast in August 2008.

While it’s by no means the case that all of the lost dollars jumped to the Internet, according to several publishers and fashion marketers, fashion brands are experimenting more than ever with Web advertising, drawn to the low cost and the accountability it offers in lean times — not great news for traditional publishers. And whereas once a high-end brand might have been reluctant to advertise in an apparently less prestigious environment, there is now an array of established media companies with increasingly developed Web presences — say, the New York Times’ Moment blog, or Style.com — as well as successful independent fashion blogs that are more established and well-read.

Take Glam.com, which is primarily an ad network for fashion blogs, with some original content. Advertising grew by more than 200 percent year over year in 2008 versus 2007, with increased commitments from Macy’s Inc., Target Corp., Neiman Marcus Inc., Armani and Nine West. Other advertisers included Swarovski, Elizabeth Arden, Revlon and Kate Spade. Samir Arora, founder of Glam.com, said that despite the economy, Glam continues to grow and he expects to add 30 more employees in 2009.

“The ability to analyze ROI means there’s even more focus on online advertising in this kind of environment,” said Paul O’Regan, executive vice president for communications at Oscar de la Renta. “That’s especially true when you consider media plans which can involve 100 grand per page to be the ‘right’ media environment. These days, we’re looking at a more unified approach because of a direct or indirect alignment with driving sales.”

Other benefits, said O’Regan, include the ability to target specific demographics and focus on proven customers.

Banana Republic chief marketing officer Peter DeLuca said the company has been shifting dollars from newspaper advertising to online marketing. “It’s the art of balancing how you’re reaching the consumer these days,” said DeLuca. “Print plays a role in developing that key fashion sense; online plays a role in driving more action.”

Advertisers are concerned about “performance and moving product,” said Fran Hauser, president of the digital assets at Time Inc.’s Style and Entertainment Group, which includes People, People Stylewatch, In Style, Entertainment Weekly and Essence. “On our end, we’re working harder than ever to really understand what success looks like for the advertiser, and monitoring the performance and optimizing as we go.”

Notably, the TNS figure on the apparel industry’s advertising spending on the Internet only counted display advertising, excluding paid search, broadband video or any recent innovations such as iPhone applications and social media. It also by definition did not count the branded content and e-commerce portals that retailers and fashion brands are building for themselves. These elements are increasingly significant prongs of many digital marketing strategies.

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