Magazine article Folio: the Magazine for Magazine Management

Newspapers Fail to Grab Magazine Ads: Discount Price Plan Flops with Packaged Goods Advertisers

Magazine article Folio: the Magazine for Magazine Management

Newspapers Fail to Grab Magazine Ads: Discount Price Plan Flops with Packaged Goods Advertisers

Article excerpt

Newspapers fail to grab magazine ads

Discount price plan flops with packaged goods advertisers ] A discount rate plan designed to increase newspapers' share of national advertising, at the expense of magazines, is apparently falling far short of expectations.

Launched more than a year ago, the Packaged Goods Rate Plan (PGRP) seeks to entice national advertisers into display ads with special reduced rates. Packaged goods advertisers, who have long spent national ad budgets on television and magazines, use newspapers primarily for coupons or occasional promotions.

Nearly 300 dailies individually offer the plan. To qualify for a discount, advertisers must buy at least 13 quarter-page ads per year; coupons are ineligible. Prices vary from paper to paper because of price-fixing laws, but generally run 27 percent to 30 percent off national rates.

By some reports, few of the dailies participating have seen significant gains in national packaged goods ads. "In fact, newspapers are not seeing any windfall of advertising at all," says Michael Drexler, executive vice president/national media director, Bozell, Jacobs, Kenyon & Eckhardt. Now, as the plan approaches the end of its 18-month test period, participants have begun to grumble, and some have dropped it.

"What we've learned so far is that there's much more to the problem than price," says Larry Letters, general advertising manager, Los Angeles Times, which canceled the packaged goods plan last fall. …

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