The measurement conundrum

Even though we share the same street, the household across the road is pretty different from mine.
While I reside in a three-floor rental house with young couples occupying almost every floor, across the street lives an elderly couple. Members of our house hustle in and out during all hours with work and social plans. The couple across the street often spends days sitting on the porch watching grandchildren.

Even though we share the same street, the household across the road is pretty different from mine.

While I reside in a three-floor rental house with young couples occupying almost every floor, across the street lives an elderly couple. Members of our house hustle in and out during all hours with work and social plans. The couple across the street often spends days sitting on the porch watching grandchildren.

And while the addresses of the two houses may be close, you can be sure the spending habits and lifestyles are not.

Right now, both households get the same flyers, but if the one-year-old Toronto-based Flyer Distribution Standards Association (FDSA) has its way, one day distribution could become so targeted that only the relevant ads land on our respective doorsteps. The first step toward that elusive goal, though, is coming up with an effective, independent and reliable method of measuring exactly what flyers are reaching what households right now.

To that end, the FDSA, established to create a unified voice for the $1.3-billion-a-year flyer medium, launched a test this past spring through NFO’s CF Group (previously Canadian FACTS, the Toronto firm that collects raw newspaper data for NADbank and magazine numbers for PMB).

The test was conducted in two markets, Ottawa and Peterborough, from mid-April to mid-May.

The two markets were chosen for specific reasons: Ottawa is a larger urban market served by three different flyer carriers (the Ottawa Citizen, The Ottawa Pennysaver and Transcontinental Distribution’s AdBag), while Peterborough is a smaller rural market.

Over the four weeks, participants in a total of roughly 150 households were asked to note in a diary whenever a flyer from one of 26 participating retailers crossed their doorsteps.

Gillian Humphreys, VP of NFO, says it’s important to note that thanks to the use of a diary, the project will produce more reliable data than a simple survey. ‘It doesn’t rely on people’s memories,’ she says. ‘Asking people what flyers were delivered to their homes even yesterday is not very reliable. We’re not asking them for their opinions on anything. It’s just a straight record of what happened.’

The FDSA says it’s too early to release summary results (they will be announced at its annual general meeting Sept. 19 in Toronto, along with sample numbers on Canadian Tire flyer distribution), but preliminary findings have already highlighted three areas where improvements can be made.

The first is the timeliness of flyer delivery. Flyers are very time sensitive, often being delivered to houses just 24 hours before the big sale they’re touting begins. It’s very difficult to get that timing just right, says Peter Martin, president of Toronto-based flyer distributor Geomedia and chair of publicity for the FDSA, because vehicles like community papers only go out on certain days, and the loose network of delivery people is tough to monitor.

The second area the FDSA will look at in light of the survey results is better controls to make sure the total number of households reached by a drop is actually what it’s supposed to be.

Finally, the survey showed that duplication is an issue, thanks to the variety of carriers and delivery methods.

A national rollout of the project next spring will further examine all three areas.

This test is the first time that a third party has measured flyer distribution quantitatively in Canada, a task that is normally handled by distributors themselves.

‘The time had come to measure,’ says Bill Sheine, former VP of advertising and now a consultant for grocery chain A&P. ‘There were no means for us to effectively measure distribution and we had to go on the merits of distributors. And while many of them are good and perform their own audits, to me it was always suspect because you were allowing the person you were doing business with to provide you with the information.’ In other words, it’s like asking the sales clerk if the outfit you’re trying on looks good on you.

‘When you look at the rest of the media industry, radio and television and magazines, everyone has [independent] measurement in place,’ says Guus Sevink, manager, print media planning, for Toronto-based retailer Sears Canada. ‘But the flyer industry does not, and with so much money being spent in this part of the advertising business, it was about time the industry was recognized as a professional service.’

Indeed, for many retailers, flyers eat up a huge chunk of the marketing budget.

At A&P, flyers account for 80% to 90% of the ad budget, and that includes television spending. Through its various chains, including Dominion, Ultra Food & Drug and Food Basics, the company delivers more than five million flyers a week throughout Ontario.

According to the FDSA, major retailers allocate an average of between 60% and 70% of their budgets to the medium.

‘The industry is definitely moving towards having a better understanding of response levels, return on investment and knowing where every dollar spent is generating a dollar sale,’ says Geomedia’s Martin.

But while the FDSA is full of enthusiasm for the transition from self- to third-party measurement, some concerns are also surfacing, especially among those who have offered such measurement services for profit or as a point of differentiation until now.

‘I know how well we verify delivery and the effort that we put into it, and not everybody else does,’ says Barry Wallace, VP marketing and corporate sales for Toronto-based distributor Metroland. ‘In a general sense, I want to see everybody delivering and verifying well – it’s going to bring everyone else up to our standard. But one of the competitive advantages we have now is that area of verification, so I have mixed feelings about it.’

‘If a third party can bring more credibility into the whole organization, then why not?’ says Ronald Roy, GM, national sales for Montreal-based Transcontinental Distribution. ‘Unfortunately I think the whole thing is coming from certain areas of the country where maybe controls aren’t in place and where there are small distributors or newspapers handling the distribution. The only problem with third party is you’re getting someone who’s not in the business to measure.’

At the end of the day, cost may be the overriding factor in implementing a measurement system. Some distribution companies may even get caught up in a catch-22 situation: Better targeting may make the flyer industry as a whole more attractive, but almost by definition, increasing effectiveness means that fewer flyers will do the job, meaning a loss of printing and distribution income.

Until it gets better, well, I’ll just keep tossing out any gardening product flyers that I receive.