Scholastic: going beyond PIP for third-party advertisers

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Scholastic Inc., the world's largest publisher and distributor of children's books, uses its reach and reputation to work with third-party advertisers in a variety of ways, from the package insert to a sponsored book designed to meet federal education standards.

The publisher, which reaches more than 35 million children and boasts a presence in nearly every school in the United States, targets its marketing programs to parents. Its At Home division offers learning products for parents looking to augment their child's school experience. In addition to statement stuffers, package insert programs and advertising in children's book clubs, the channel offers Webserts and banner ads.

"We're driving so many customers through the Internet, but we weren't monetizing that space as much as we could have been," said a group director of media at Scholastic At Home.

He said that over the past two years the division's third-party Web ad program has seen 300 percent to 400 percent growth. In the last three months advertisers such as Columbia House, Netflix and Gerber began using the division's programs. Marketers can put ads in Scholastic At Home welcome, order confirmation and monthly promotion e-mail.

The division expects to be testing ads in its acquisition e-mails soon as well.

Print flint
As part of its strategy to drive more consumers to the Web site, Scholastic added an online account center for buyers to make payments as well as enhanced product information and education resources.

However, the program manager estimates that 95 percent of the division's third-party advertisers market through print-based inserts. This may slowly change as, internally, Scholastic At Home cut back on its own use of print inserts. It also cut back on the print quantities of co-ops that the company uses for acquisition.

"A lot of people's print budgets have been reduced," the Scholastic executive said. "We're not doing as much business as we were. It is due to the nature of the postal increase. Webserts' growth is only going to continue."

In addition to rising print costs and postal increases, the print insert programs face operational challenges, too.

"The success of your program can depend on how good or bad your warehouse is," the group director said.

Another issue for print inserts at Scholastic was differing offers for English-speaking and Spanish-speaking households.

"We originally couldn't segment that out," he said. "Now it is a very popular and successful segment for our programs."

Idol ideal
While children use Scholastic materials, the purchasing power is in the hands of the adults around them. The Scholastic InSchool Marketing department uses this as well as its reputation as a partner to teachers to aid its ad partners and educate children.

It develops and distributes branded in-school marketing programs. While the custom clasroom materials teach, marketing offers are sent home to parents suggesting products related to the in-school topic.

"Corporations and nonprofits are interested in supporting Scholastic and getting their message in front of parents," said Ann Amstutz-Hayes, vice president of Scholastic In School Programs. "We work very carefully with our partners to understand what they're trying to accomplish."

One example is the "Idol Gives Back" Web portal project sponsored by the Skoll Foundation with partners Fox, FremantleMedia North America, 19 Entertainment, "American Idol" and Charity Projects Entertainment Fund.

The site offers a virtual classroom program for grades K-12 to learn about important global issues and take action. The site's materials include the student magazine Teen Citizen and a downloadable classroom poster.

A class apart
According to Ms. Amstutz-Hayes, 99 percent of the materials in Scholastic InSchool Marketing programs are free to classrooms.

The benefit to the advertiser is to be seen as a sponsor of this learning and to reach the parent in a positive way.

"There has been a cause marketing influx," she said. "Corporations are looking for an opportunity to connect with consumers on an emotional level."

Response rates are proprietary to marketers. However, Ms. Amstutz-Hayes did say that 40 percent of the companies are repeat partners.

The materials created have a 70 percent to 90 percent usage rate, according to the company. Programs can take anywhere from fourweeks to six weeks or from six months to a year to develop. They include print components, online interactive and customized books.

Ms. Amstutz-Hayes said that the corporate policy is to never take advantage of that trust. All partnership projects must be deemed appropriate and include a learning lesson.

"It's our brand," she said. "We're the No. 1 educational publisher in the country. We take that trust seriously."

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