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Outlook 2005: Custom Publishing Deserves a Second Look for CRM

Marketers stung by complicated technology solutions but still keen on customer relationship marketing may want to consider custom publishing as a loyalty builder between brand and consumer.

Company-sponsored magazines and customized online newsletters and white papers already are at the heart of many CRM strategies overseas. Locally, sectors like retail, technology, travel, automotive and financial services have embraced the concept.

“Custom publishing in the U.S. is surging, and there is every indication that the momentum will continue to build,” said George Stearns, chief operating officer at custom publisher Pace Communications, Greensboro, NC.

North American companies produce 116,000 custom publications yearly, according to the Custom Publishing Council, New York. The annual spend on this form of marketing communications is nearly $30 billion.

Consider some of the top titles and their custom publishers. McMurry Inc. produces The Ritz-Carlton Magazine for the same-named luxury hotel chain and Arrive for Amtrak. Bloomberg LP publishes On Investing for broker Charles Schwab & Co. Fluent Communications produces Lexus Magazine. John Brown handles B for Bloomingdale’s.

Another major custom publisher, Pohly & Partners, has clients such as Coca-Cola Co., Continental Airlines, Sheraton Hotels & Resorts, Putnam Investments, Verizon, Western Union, Schering-Plough and Sotheby’s.

Across the Atlantic, Britain’s Redwood Group creates custom magazines for American Express, Boots, Land Rover, Marks & Spencer, Harvey Nichols, Royal Mail, Volvo Car Corp. and Thomas Cook. Its Canadian-American arm has clients like Kraft North America, The Scotts Company, RBC, Sears Canada, General Motors North America and The Home Depot. All told, Redwood magazines have a circulation of 58 million yearly in 21 languages and 13 countries.

For its part, Pace creates the Teradata business-to-business title for NCR Corp. It also custom produces United Airlines’ Hemispheres, Delta Air Lines’ Sky and Carlson Hospitality Worldwide’s Voyageur. In March, Pace will launch AAA Living for the Auto Club Group, the largest AAA affiliate in the Midwest. It arguably will be one of the most targeted custom publications nationwide with 21 editions segmented by life and member stages.

“We believe in the power of custom publishing to strengthen brands, especially when it comes to many of the softer components of brand equity,” Stearns said. “By offering relevant, valued content and engaging design, custom publishing can help companies establish a dialogue and emotional connection with customers, fuel overall brand strength and boost brand value.”

Many custom publishers are independent outfits. Some are owned by ad agency holding companies wise to custom publishing’s revenue potential and synergy to marketing offerings. Redwood, for example, is part of Omnicom Group Inc.’s AMV Group. WPP Group PLC, owner of agencies like Ogilvy & Mather, J. Walter Thompson and Young & Rubicam, has three custom publishing units: Forward, Spafax for in-flight media and the Shine: M joint venture for television content.

Not just frustrated editors and ambitious public relations executives work at custom publishers. Marketing strategists aware of a client’s CRM goals to retain customer loyalty often are recruited to add heft to the shingle on the door. However, U.S. marketers still have not fully understood custom publishing.

“Compared to markets such as Britain and Germany, custom publishing in the U.S. is in a relatively early stage of development,” Stearns said.

In Britain, seven of the top 10 magazines in circulation are company-sponsored custom publications. In Germany, most large corporations sponsor custom publications.

How does custom publishing tie into relationship marketing? For that, gaining a grip of the four prongs of CRM is necessary.

First, understand the customer thoroughly and analytically. Second, communicate: deliver the pertinent message to the right customer via the right media at the right time and place. Third, reward customers in a meaningful way to engender long-term dialogue and loyalty. Finally, CRM re-quires a marketer to serve its best customers in a manner that differentiates the company from its rivals.

“For many companies, especially those with a decidedly direct marketing orientation, custom publishing can frequently meet the ‘communicate’ imperative of CRM better than any other form of marketing communication,” Stearns said. “As further advances are made in variable data and digital printing technology, custom publishing’s role in CRM and direct marketing promises to become even more prominent.”

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