August 9, 2004
MEDIA & MARKETING DOW JONES REPRINTS
Blurring the Line? Magazines Face New Pressure As Marketers Seek to Blend Advertising With Content

By BRIAN STEINBERG and JAMES BANDLER
Staff Reporters of THE WALL STREET JOURNAL
August 9, 2004; Page B1

The latest issue of Country Living magazine carries an eight-page
advertising insert from Home Depot Inc. and its EXPO Design Center.
On a facing page, the magazine displays a feature story describing
how "with the help and careful planning of EXPO Design Center, a
dreary kitchen turns into an efficient workspace."

Such juxtapositions are considered by many in the media industry to
be a no-no, violating generally agreed upon boundaries between
editorial content and advertising. Indeed, in this case, a
spokeswoman for the magazine says it was a coincidence, not the
result of a deal. But such juxtapositions are just the kind of
editorial mention that marketers love to have as they seek to stand
out from the advertising clutter.

Many advertisers are enjoying new opportunities to embed their
marketing messages into TV shows, videogames, movies and other
programming. That's emboldened some to try to mix ad messages and
content in magazines as well -- such as running ads next to magazine
stories about the same product, getting products mentioned in
stories, creating contests linked to magazines, and running ads that
look like magazine layouts -- all of which could blur the traditional
line between editorial and advertising.

The American Society of Magazine Editors for years has maintained
guidelines for upholding that separation. Now it says it's preparing
to re-evaluate those guidelines. ASME's president, Newsweek Editor
Mark Whitaker, says the group isn't seeking to toughen or loosen the
standards, but to eliminate "grey areas" in which content and
advertising can blur. "Just the fact that some of this has happened
in TV means that advertisers are starting to push a little harder"
for similar treatment in magazines, says Mr. Whitaker. Many
newspapers are facing similar advertiser pressure.

A recent Motorola insert in the New Yorker featured cartoons labeled
'advertisement.'

One area in particular that ASME will examine are the new "shopping"
magazines, such as Hearst Corp.'s Shop Etc. and Cargo and Lucky from
Advance Publications Inc.'s Conde Nast, says Mr. Whitaker. Lucky, for
example, resembles a mail-order catalog, featuring phone numbers for
merchandise orders. Mr. Whitaker says the re-evaluation, first
reported by the Delaney Report, a media and marketing newsletter,
will take a year or longer.

A Country Living spokeswoman at Hearst, its publisher, says the ad
and article fell within ASME guidelines. She says there was no
coordination between the magazine's publisher and the editorial
staff. She calls the adjacency "purely coincidental," saying the
magazine's ad staff didn't know that the editorial staff was doing an
article involving Home Depot, and that the advertising insert was put
in after the the magazine was printed in one of the few places in the
magazine where inserts can be put.

Though he hasn't yet seen the advertisement, Mr. Whitaker says the
Country Living example sounds like an area "where a reasonable reader
might think there was some kind of trade-off and that there was
deliberate adjacency. When you have editors endorsing a product and
you have an ad next to it, it looks a little fishy."

Although ASME has no formal means to enforce its edicts, it does
preside over the annual National Magazine Awards, which are highly
valued in the magazine world. A magazine that violates the guidelines
risks being declared ineligible for the awards or kicked out of the
society.

Some big-name titles, including Wenner Media's Rolling Stone, have
received a warning letter from ASME. When DaimlerChrysler AG learned
that actress Angelina Jolie would be on the cover of Rolling Stone
last summer, the car maker saw a unique opportunity to get a message
about its Jeeps to the magazine's readers. So Jeep bought an ad
featuring Ms. Jolie on a fold-out page attached to the cover; the ad
depicted her in her "Tomb Raider" movie role, Lara Croft.

ASME guidelines state that ad pages should not be placed adjacent to
related editorial material in a manner that implies editorial
endorsement, "including advertising that features the same celebrity
or product image as the cover image." (Among other ASME rules: no ad
or purely promotional contest may be promoted on the cover or in the
table of contents, including cover stickers and other "onserts"; ad
pages should look distinctly different than editorial pages, and if
they don't, they must be clearly labeled as ads.)

Wenner apologized and said it wouldn't happen again. But the
advertiser was mystified. "I don't get it," says Jeff Bell, a vice
president of Chrysler and Jeep who oversees marketing and product
development for the brands. He didn't think the ad would suggest that
the company had any influence over any interaction Rolling Stone had
with Ms. Jolie in preparing the cover story. "Did we tell them, 'No,
please ask her if she likes Jeep?' It's an interview. She's going to
say what she wants to say."

Marketers are being motivated largely by the need to get more bang
for their advertising buck. Increasingly, they need to prove that
their ad efforts boost sales, drive market share and increase brand
recognition. According to companies that buy ad space, advertisers
often ask to have products mentioned in magazine articles or have
their logos or brand names affixed to the cover in some fashion.

Magazine publishers "are under a lot of pressure right now, and quite
frankly, I don't think many are delivering," says Steve Moynihan,
executive vice president and managing director at Havas SA's MPG,
which places ads for Volkswagen AG among others.

The pressure from advertisers is putting magazine editors in a tough
spot, too. Some say the ASME rules give them a way to reject
advertisers' demands without offending, and they welcome greater
clarity and enforcement.

Stephen Shepard, editor-in-chief of Business Week, said business
publications generally do a good job at standing up to advertisers.
"We write about advertisers all the time and the church-state rules
got fixed early on, and are well understood."

Kim France, editor-in-chief of Lucky says ASME "is totally confused
by us, but they see that we're the future." She bridles at the
perception that the shopping-oriented publication is blurring lines
between advertising and editorial. In fact, she says the magazine's
"market editors," who scour the fashion world for the best products,
"have experienced pressure in some of the ugliest ways from
advertisers." After learning that their products aren't getting
mentioned, some advertisers have suggested that advertising spending
will be curtailed, Ms France says, declining to identify the
advertisers. "We have always pushed back."

Yet some publications do seem to be accommodating at least some of
advertisers' demands, although the magazines generally deny that they
have compromised any standards. Playboy Enterprises Inc.'s Playboy
let Tommy Hilfiger Corp. use Playmates in print ads. "Readers are
very savvy -- when a Playmate is featured in an ad, it certainly gets
noticed, but there isn't any editorial endorsement," said Diane
Silberstein, the magazine's publisher, via e-mail.

Modern Bride, published by Conde Nast, featured a small ad for a
Target Corp. bridal registry on the spine of its June/July issue. The
magazine's publisher said the practice was "not intrusive."

Last year, SABMiller PLC's Miller Brewing placed an eight-page
advertorial in male-oriented Dennis Publishing magazines such as
Maxim and Blender featuring bawdy, illustrated tales of guys who
partied in New York City, all with the humor and tone of features in
the magazine. The ads were "designed to break into the editorial
consciousness" of the magazines, according to a news release
announcing the initiative. A spokesman for Dennis declined to comment.

A booklet sponsored by Motorola Inc. appearing in a recent issue of
the New Yorker featured cartoons resembling the ones in the pages of
the venerable title. Each cartoon page in the booklet is clearly
labeled "advertisement." David Carey, publisher of Conde Nast's
publication, said New Yorker cartoonists have been doing
advertisements since the days of the late William Shawn, one of the
magazine's legendary editors. "Today, we do this from time to time,
and every page is clearly labeled advertisement, so readers know this
is not normal editorial," he said.

Even ad-space buyers say a concrete body of rules can only help
publications whose readers view them as authorities and taste-makers.
"I think it's critical that the ASME guidelines exist, because that
way you maintain the integrity of the medium," says Brenda White,
director of magazine investment at Starcom USA, a unit of Publicis
Groupe SA.

Meanwhile, if advertisers can't get what they want in print, they may
look elsewhere. DaimlerChrysler's Mr. Bell says he has shifted
spending slightly away from network TV and magazines to
"experimental" media such as the Internet and videogames. Traditional
publications should be more flexible, he says. "Everything else in
our reality -- whether it's the Internet, or cable, or movie product
placement or TV product placement -- is saying that there are natural
and organic ways for the two to come together."