The special relationship between publishers and advertisers is on the rocks
It’s always sad when you come across a once happy relationship that is now on the rocks – particularly when one of the couple doesn’t even seem to notice.
Minor aspects of the union that might once have been overlooked become much bigger issues once the downward spiral begins.
By the time both parties realise how bad things are and promise to change, it can be too late. So I’m sad to see one of Australia’s longest relationships headed in the direction.
I refer, of course, to the growing loss of trust between Australia’s publishers and advertisers.
Over the years there have of course been previous transgressions, forgiven in the give and take of the relationship.
But then came autorefresh. It gradually began to dawn on advertisers and media agencies that their partner had been cheating on them.
They were selling them a reader once but charging them multiple times. Once they were caught – and in many relationships the realisation dawns only gradually – they promised to change. And they’ve kept repeating the promise.
The truth of course is that despite the promises, nothing really happened. The autorefresh continues.
Everytime somebody dodges being audited or is caught misleading the market (you may remember our rival AdNews’ creative behaviour over both its print and online numbers) things get a little worse.
Once the trust has gone, the relationship goes onto probation.
Which is why this week’s Crikey revelations about Fairfax’s circulation issues with The Age rocks that buying relationship.
There are explanations, possibly even good explanations, but previous experience makes it harder to take things on trust.
If this was the first time, there would have barely been a ripple.
It didn’t really help that the explanation appeared to miss the point of the allegation – accused of exploiting a loophole, the answer was that they hadn’t actually broken the audit rules.
Rather like Bill Clinton did not have sexual relations with that woman.
Maybe not, but as we now know, something sure went on.
The leaked email seemed to suggest that they knew the market wouldn’t be happy if it learned of the practice so decided not to launch a new initiative that would have exposed it.
Issuing an explanation that everything was okay because they didn’t launch that initiative, without dealing with the issue of the ongoing questionable practice, doesn’t quite address the main point.
Rather like a cheating spouse telling their partner that they were thinking of them the whole time they were with someone else.
So can the relationship be saved? Perhaps – all things considered, most advertisers seem to be being remarkably passive about all the previous infidelities. The other party – and I mean all the publishers, not just Fairfax – don’t seem to realise how much trouble the relationship is in.
Otherwise, why would they be throwing so many delaying tactics into revealing individual edition sales information?
The trust has almost gone. At some point the last chances will run out.
Tim Burrowes
Tim Burrowes founded Mumbrella in 2008. He worked on Mumbrella until 2021. At various points he was editor, content director and editor-at-large.
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for the ABA drum beaters to comment on this?
C’mon guys hurry up and enlighten us all with your insight into this very serious matter
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Looking at The Age (M-F) audit data from the September 2008 quarter to the June 2010 quarter, the lowest audited figure was 189,500 (March 2010) and the highest was 206,700 (June 2009). Note that this reflects the usual seasonality driven by the footy season.
Based on this data (albeit from after the email of three years ago) there is no evidence that a ‘fake’ 40,000 copies made there way into the audited numbers – there simply isn’t a 40,000 copy ‘spike’ or ‘trend break’ that I can see in the data that we use for trading. A publisher can print and give away 22.5 million extra copies and I simply don’t care as long as they don’t go into the audited data.
I’m in no way saying that 40,000 ‘educational copies’ weren’t either thought about, planned, printed, delivered etc. (I’m not saying that they were either), but if what was alleged happened, the audit process appears to have trapped them and removed them as was planned under the audit rules.
Also, don’t you think that if a rort as suggested by Crikey happened that their competitor’s wouldn’t have kicked up a shit-storm before now? Of course they would have FFS!
Paul and Heather over at the ABA – can you see ANY evidence in the longer term trend data (i.e. from before this leaked email was written) of any spikes in the audited circulation?
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Thanks John.
Firstly, I’d like to note that the ABC has launched an investigation into the matter and The Age is cooperating with our requests to date. We can speculate for hours on what may or may not have happened with The Age’s circulation however we won’t be commenting on the specifics of the issues raised by Crikey until the investigation has been completed.
I’d also like to note that the treatment of the ‘hypothetical’ elements of the leaked email by Crikey has blurred the boundaries of circulation and readership creating a misleading analysis of how the two metrics are used in the market place.
The ABC Rules released in 2006 were the culmination of 18 months of solid debate and negotiation between media buyers and sellers resulting in a set of rules which best reflected modern day circulation practices and an unprecedented level of transparency in our market.
Audited circulation provides a level playing field for publishers of newspapers and magazines to report copies sold. There are too many nuances to what constitutes a sale in our rules to cover in this posting, however suffice to say that it wasn’t the intention of the rule changes to get in the way of the publisher’s right to pursue opportunities to circulate their publication.
At the core of the ABC rules is the principle that a ‘Net Paid Sale’ best captures individuals wishing to purchase a publication. Where this principle is not clear, a breakout of that channel of circulation is required. Copies sold to a learning institution for distribution to students and staff is one such channel and must be reported separately as ‘Education Sales’.
A subscription offer to an individual, regardless if they are a mum or dad, student or teacher is treated as a regular sale if it is accepted on the terms and price of the offer made. Who subsequently reads the copies circulated is analysed through the readership survey and is not a function of the circulation reporting.
As to the ‘special relationship’ between publishers and advertisers being ‘on the rocks’ I would suggest that this issue proves the ongoing importance of print media. Our industry is at its strongest when buyers and sellers discuss, debate and resolve such issues in a consensus manner as was evident in the ABC’s rule review process in 2006.
This is one of the reasons why the ABC and the CAB exist; to provide an informed and balanced forum for these issues to be dealt with and resolved. The leaking of hypothetical emails and the mistreatment of the facts by sources such as Crikey contribute very little to the betterment of our industry. Any ABC member has the right to raise issues and even propose rule changes where necessary. The ABC’s rule amendment process ensures that all stakeholders, media buyers and media sellers have an opportunity to comment on the proposal before voting on its merits.
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I’m sorry to say both commenters wilfully evade the point. It’s completely irrelevant whether the hypothetical scenario described in the Fairfax email — to separate the education section out from the main book — was ever acted on (it wasn’t). The point — which is clear if you actually read the email — is that if the scheme *had* been enacted, then The Age would have been forced to reveal the number of copies (40,000) it actually bulk-delivers to universities and schools. Those copies aren’t required to be listed under the current ABC education definition and that’s precisely why the scheme never proceeded.
The email stated plainly what would have happened if the 40,000 number was made public — The Age would have had to “write down” the value of its advertising because advertisers regard bulk-delivered copies as less valuable than a regular sale or a full-price subscription. Last week, Crikey revealed that figure.
In the case of schools, thousands of heavily discounted newspapers sit in staff-rooms unread each day. In the case of universities, thousands of unread copies pile up in student unions and end up in recycling bins. In both cases, all copies are counted in the headline circulation number.
Before the Crikey story appeared, there was no way for advertisers to really know how many papers were being bulk-delivered to Victorian schools and universities. As Margaret Simons wrote in Crikey, the email and the other documents were the first hard evidence revealing the true state of affairs.
There is a loophole in the current ABC education definition that allows newspapers to roll bulk education copies into their headline circulation figure. The reaction of advertisers to the Crikey story means that loophole will soon be closed.
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That’s a rather stern turn of phrase Andrew – wilfully evading the point.
I would LOVE to know more about this “loophole” you refer to. Because as Paul Dovas pointed out “Education Sales” HAVE been included since 2006 when the rules were re-written.
As a matter of fact, looking at the M-F The Age for June 2010 quarter, the ANPS was 197,500 and the Education Sales were 0.36% or on average 711 copies per weekday edition. (please note the exclusion of the bulk copies from the ANPS figure).
To elucidate, the way it works is as follows:
* the publisher offers a discounted sale
* the student or teacher signs up and (in general) they get a card showing their subscription – name etc known.
* rather than deliver the 711 papers to 711 different addresses a bulk delivery is sent to the school or delivery
* the subscriber shows the card to ‘redeem’ their copy
* now if it is the 40,000 copies you allude to – that bulk delivery is ignored and only the 711 subscriptions count. It could be 100,000 copies and the APNS ‘headline’ figure would not change one iota
* of course the publishers hope that the free bulk copies inspire more subscriptions
So Andrew, may I humbly suggest that if there is a loophole as you strongly suggest then you provide the factual evidence to Paul Dovas at the ABC as part of the investigation that he has already initiated. That is, put up or shut up.
And while you’re talking to Paul, maybe you could organise for the Crikey website to be audited (I notice that it currently isn’t), as you sure seem keen on having everything audited and buttoned down.
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I’m beginning to think, John, that you haven’t read the stories and seen the links to The Age’s own internal documents (three at last count). The evidence is plain. In 2004 The Age was printing 35,000 copies listed as “education” by its own admission. In 2007, on one Wednesday in one week, it was printing 47,000 “education” copies. These are not my numbers — read the documents yourself.
These copies are bulk delivered to schools and universities but not broken out from the APNS headline figure because they’re technically deals with individuals (The Age, via newsagents retain indvidual “subscriber” details). Newsagents have a vested interest in “selling” these heavily-discounted copies because they get 25% of the cover price, just like a normal sale. That is the loophole. A huge proportion of these copies are not picked up and a huge proportion are delivered to readers well outside Fairfax’s preferred AB demographic. Again, we’re talking about 20% of The Age’s circulation here. It’s not a small number and will affect ad rates for years to come.
But don’t take my word for it — click on the links and see how you go.
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You’re correct Andrew. I’ve clicked on a gazillion links in the story thread on Mumbrella and can’t find a bloody one that refers to the data your’e quoting. Kindly post them here to assist.
The comment that concerns me is the ‘one Wednesday in 2007’ as that is after the rules change (mid 2006 implementation, Q3 2006 reporting). The reason the rules were changed was to break-out such things as the ‘educational’ copies and to make these marketing tactics transparent – i.e. the current practice in the ABC data. I note that the previous instance you referred to was 2004 – the reason the rules were changed.
I would be very interested to know whether this ‘one Wednesday in 2007’ was a one-off instance, or whether it was a common and regular practice in your opinion.
Just doing some back-of-an-envelope numbers, in a quarter there are 65 editions of the M-F The Age. If the 47,000 was done just ONCE during that quarter, then it equates to an average of 723 copies per day. This is pretty much in-line with the current ‘educational copies’ figure of 711 – the figure that is (i) included in the ANPS as you point out and (ii) is broken-out for all to see. Can you provide any guidance on the frequency of this occurrence beyond the ‘one Wednesday in 2007’?
By the way, how’d you go on the audit for your website?
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Andrew, there is a good reason why the ABC takes a more thorough and measured approach to investigating serious allegations like those you continue to raise against The Age.
For starters, we believe our members are innocent until proven guilty. While the emails you have cited warrant further attention, they by no means provide sufficient evidence to implicate the publisher, newsagents nor Victorian learning institutions in a ‘scheme’ to take advantage of a ‘loophole’ in the ABC Rules.
You continue to display very little understanding for the nuances between circulation, distribution and readership. Your articles and posts interchange these very different terms, creating inaccurate conclusions, leading to dangerous allegations.
Thankfully our Advertiser and Agency members, which represent a major share of the ad spend in print, have a better grasp of how print is measured and a greater respect of our rules and processes which they helped formulate.
The ABC will gladly accept and consider any material sent to us in private that may assist our investigation, however we ask that forums such as this, or your own, are not treated as a Kangaroo Court through a blatant disregard for how circulation is measured, audited and reported.
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