U.S. mags test split-run waters

The barbarians may not exactly be storming the gate left open by the passage of Bill C-55, but they are starting to test the defences....

The barbarians may not exactly be storming the gate left open by the passage of Bill C-55, but they are starting to test the defences.

In what many are saying is the first real incursion of foreign split-run magazines into Canada since the controversial federal magazine bill was passed into law last June, two U.S.-based magazines, Maxim and Prevention, have recently announced plans to sell stripped-in ad space to Canadian advertisers.

The bill allows foreign-owned magazines with no Canadian editorial content to sell as much as 12% of their total advertising space to advertisers who want to reach only a magazine’s Canadian rate base. The threshold increases to 15% in 2001 and to 18% in June of 2002.

Representatives of both Maxim and Prevention say their split-run foray is an experiment, but that if results are good, more aggressive sales and marketing campaigns could follow.

"We know the health movement among a certain age group is global," says Denise Favorule, associate publisher of Prevention, a wellness publication owned by Emmaus, Pa.-based publishing giant Rodale Publishing. "It could be something that really grows and has a huge interest in Canada."

Of Prevention’s total circulation of three million, there are approximately 118,000 Canadian subscribers. Another 36,000 copies are sold on Canadian newsstands. A full-page, full-colour ad in the magazine’s Canadian edition will cost $18,000. Given that its April issue ran 116 pages, the magazine could have sold as many as 13 full-page Canadian ads and still have been under the 12% threshold.

When Bill C-55 was finally enacted last year, Rodale Publishing took a closer look at the Canadian market, where it was pleased to discover Prevention is the largest paid subscription health magazine in the country, says Favorule. With a median reader age of 50, and an 80% female skew, the magazine targets a potentially lucrative market of boomer-aged women. Canadian publications that could suffer as a result of it entering Canada as a split-run include general interest women’s magazines like Chatelaine, Canadian Living and Homemakers, and even unpaid circulation magazines like Shoppers Drug Mart’s Healthwatch.

In the case of Maxim, there’s nothing else like it published in Canada, says Martin Tully, president of Canadian Media Connection, the Toronto-based sales agency that represents both it and Prevention in Canada. Maxim, which targets men 18-35, is best known for its monthly photo-heavy features of Hollywood starlets.

Maxim represents a significant media opportunity for Canadian advertisers. Its paid Canadian circulation doubled from 109,000 in June 1999 to 213,000 at the end of the year, according to the Audit Bureau of Circulations. In the U.S., 1.3 million people buy it monthly.

"I think in most cases, advertising for Maxim will come from other media," Tully says, noting that sports-focused television programs would form Maxim’s primary competition.

Maxim’s advertising director, J.P. Kyrillos, agrees. In a phone interview from the magazine’s New York office, he adds that Maxim shouldn’t be painted as a Goliath to Canadian publishers’ David.

"Maybe if you look at it in a vacuum, some ad dollars will come to the U.S. that would have gone domestically into Canada," he says. "But we’re moving toward a more global economy and certainly every country is going to lose and win. I think that goes both ways."

The Maxim and Prevention split-runs are the first trickle in what is sure to be an eventual torrent, says Canadian Magazine Publishers Association executive director Mark Jamison. His organization fought tooth and nail against split-runs during the debate between magazine publishers and advertisers leading up to the passage of

C-55 last year.

"The potential for long-term deterioration in the ability of Canadian content to survive is the issue, not what will happen in the first 10 months or two years," he says, reiterating one of the main arguments put forward by the magazine industry last year. "It’s the long-term decline that is the real worry."

Ron Lund, president of the Association of Canadian Advertisers, feels just the opposite. "We’re delighted," says Lund of the introduction of the new split-runs. His organization fought hard to gain access for its members to the Canadian circulation base of U.S. magazines. Although he says he’d like to see more Canadian content in these magazines, he emphasizes Canadians are the ones making the decision to read U.S. magazines.

"The readers are already reading the publications," he says. "We need titles that are going to attract the reader, plain and simple. Part of the problem is that protectionism only deteriorates the quality of anything, it doesn’t actually improve the competitiveness."

Despite impressive growth in Canada, both Maxim and Prevention will face a tough sell here, according to some media buyers. The main stumbling blocks? Price and a lack of readership data. A full-page ad in Maxim’s Canadian edition sells for $27,000 and neither it nor Prevention are members of PMB Print Measurement Bureau.

"That sounds pretty pricey to me," says Ailsa MacLachlan, VP group media director at OMD Canada, adding that good readership data could potentially justify Maxim’s hefty price tag.

Prevention might have an easier time with its lower cost-per-thousand readers, she says, but it also faces more competition in the marketplace. The lack of current readership data won’t keep the magazines out of the running for ads, she adds, but it will make them slightly less attractive.

In Brief: The Garden picks CDs to take on daily creative leadership

Plus, Naked names two new leaders of its own and Digital Ethos comes to Canada.

The Garden promotes two creative directors

ACDs Lindsay Eady and Francheska Galloway-Davis have taken over responsibility for day-to-day creative leadership at The Garden after being promoted to creative director roles.

The pair will also help develop the agency’s creative talent, formalizing mentorship and leadership activities they have been doing since joining the agency four and three years ago, respectively. In addition to creating the agency’s internship program, the pair have worked on campaigns for Coinsquare, FitTrack and “The Coke Challenge” campaign for DanceSafe.

Eady and Galloway-Davis will continue to report to The Garden’s co-founder and chief creative officer Shane Ogilvie, who is stepping back from daily creative duties to a more high-level strategic role, allowing him to focus on client relationships and business growth.

Naked Creative Consultancy names new creative and strategy leadership

Toronto’s Naked Creative Consultancy has hired Yasmin Sahni as its new creative director. She is taking over creative leadership from David Kenyon, who has been in the role for 10 years and is moving into a new role as director of strategy, leading the discipline at the agency.

Sahni is coming off of three years as VP and ECD at GTB’s Toronto office, where she managed all the retail, social and service creative for Ford Canada. She previously managed both Vice Media and Vice’s in-house ad agency Virtue.

Peter Shier, president of Naked, says Sahni’s hiring adds to its creative bench and capabilities, as well as a track record of mentorship, a priority for the company. Meanwhile, Kenyon’s move to the strategy side, he says, makes sense because of his deep knowledge of its clients, which have included Ancestry and The Globe and Mail.

Digital Ethos opens a Toronto office

U.K. digital agency Digital Ethos is pursuing new growth opportunities in North America by opening a new office in Toronto.

Though it didn’t disclose them, the agency has begun serving a number of North American clients, and CEO/founder Luke Tobin says the “time was right to invest in a more formal and actual presence in the area.” whose services include design, SEO, pay-per-click, social media, influencer and PR,

This year, the agency’s growth has also allowed it to open an office in Hamburg, Germany, though it also has remote staff working in countries around the world.

Moray Hickes was the company’s first North American hire as VP of sales, tasked with business development in the region.