MEDIA: Magazines with drive - Car makers are building better relationships with their clients by writing to them - several times a year and in a glossy format. Robert Dwek reports on how car manufacturers’ desire to hang on to existing customers h

The 1990s has seen a huge increase in the number and frequency of loyalty magazines mailed out by car companies in the UK. According to a recent Mintel report, the automotive sector now accounts for 6% of the contract publishing market, investing pounds 11m in magazine publishing.

The 1990s has seen a huge increase in the number and frequency of

loyalty magazines mailed out by car companies in the UK. According to a

recent Mintel report, the automotive sector now accounts for 6% of the

contract publishing market, investing pounds 11m in magazine

publishing.



While not the largest user of contract publishing - travel, financial

services, retail, business-to-business and leisure and sport all come

ahead of it - car makers are increasingly embracing magazines as part of

their marketing strategy.



Increased competition has brought the cost of finding new customers into

sharp relief against the benefits of retaining existing ones. The

recession of the early 90s proved a tonic for car manufacturers in this

respect, bloated as they were by the illusion of an all-powerful car

economy and ever-shortening purchase cycles.



But along with the recession came a reappraisal of the car culture.

’Banana mould’ technology meant more lookalike cars, undermining some

manufacturers’ carefully established brand values.



But the past couple of years have seen marked change. Car design has

improved and with it has come a renewed sense of individuality. Car

makers have learned not to brag about the wonders of high-speed,

wind-in-the-hair motoring and instead to focus on ways of relating cars

to other aspects of consumers’ life, such as young children, the

environment and surviving the urban jungle.



This can be traced to the arrival of MPVs (aka ’people carriers’ such as

the Renault Espace) and four-wheel-drives, but today’s car marketers are

a generation that understands the critical importance of brand evolution

and customer segmentation.



Meeting the market’s needs



Hence the prominent role now played by loyalty magazines - a marketing

tool that creates a stronger sense of family than perhaps any other.



And with purchase cycles retreating from the manic frequency of the

late-80s, keeping existing customers in ’the family’ will become more

important than ever.



According to Mintel’s research, almost 40% of consumers keep loyalty

magazines for future reference, 38% appreciate the special offers and

money-off coupons attached, and 30% find the articles interesting. This

helps explain why the average client involved in customer magazine

titles now spends 23% of its total marketing budget on contract titles,

with more than 40% expecting to increase spend in the future. The 23%

figure sounds high, but when you look at the number of loyalty magazines

out there - and the high production values involved - it seems

credible.



In 1996, the number of car loyalty magazines was just into double

digits.



Now, there are few car makers who don’t have one. The list of those who

do includes BMW, Ford, Vauxhall, Saab, Peugeot, Volvo, Toyota, Lexus,

Jaguar, Rolls-Royce, Nissan, Land Rover, Renault, Porsche, Mazda, Fiat,

Audi, Mercedes, Lotus and MG.



Reaching the top end



Recently rejuvenated Lotus Cars has just launched its loyalty magazine,

produced by River Publishing, which also does BMW’s magazine.



River marketing director Nicola Murphy believes magazines are ’perfectly

suited to the car buyer, particularly at the top end of the market. It

helps to develop the brand world that the customer has bought into.’



It does this, she says, by presenting relevant lifestyle editorial,

sympathetic advertising, exclusive promotions and incentives targeted at

the needs of the reader. It’s important to remember that often this

reader will be a prospect rather than an existing customer.



As we move into the last year of the database decade, these kind of

publications are being allied more strongly than ever to car firms’

direct marketing activity. Gone are the days when DM was considered far

too grubby for the pristine pages of a loyalty magazine.



Indeed, Murphy takes great pride in the fact that BMW has increased the

accuracy of its customer data by ’over 100%’ by using the offers and

promotions in its magazine to mine lifestyle data.



Flushed with this success, River is setting out to use its Lotus

offering, Pure Lotus, ’to enhance and grow their database’.



As well as capturing data and creating a two-way communications channel

with customers, loyalty magazines are a useful way of flagging new car

launches, company-sponsored events, supporting high-profile ad campaigns

and even creating new direct sales channels.



BMW has done this by launching a loyalty magazine spin-off, mailed out

alongside the main title and dubbed a ’magalogue’. It has high

production values to tantalise readers with an array of BMW fashion

items and accessories.



Ironically, BMW has had to put extra emphasis on its magazine because

service intervals have become much longer, according to spokesman Chris

Willows.



BMW’s engineering prowess and reliability was undermining its customer

relationships - because BMW dealers were seeing owners less often. ’Our

magazine is a way of keeping customers aware of things about the BMW

brand which they otherwise wouldn’t have heard,’ says Willows.



But how cost effective are loyalty magazines for car makers? Not

surprisingly, this notoriously secretive bunch - at least, when it comes

to below-the-line spend - are reluctant to provide details.



What many of them say, however, is that magazines are cheap compared

with mainstream advertising - estimates range from 50p to 80p a copy -

and have the benefit of intimacy between customer or prospect that

other, less personal, media lacks.



Toby Smeeton, a publisher at TPD, which produces In Front for Toyota,

says: ’The message that goes out is not as simple as in, say, an

expensive TV campaign. Relatively speaking, customer magazines can

transmit quite complex multiple messages much more cheaply.’



Things are a lot more scientific in this area nowadays, with consumer

focus groups playing a prominent role in the design and strategy of car

loyalty mags.



According to BMW research, 77% of its readers say the magazine makes

them feel more positive about the BMW brand.



As with other high-profile loyalty magazines, car company titles now

include a fair bit of advertising. This non-editorial content can have

the effect of making a corporate publication seem more like a consumer

magazine than a showroom brochure.



Advertising standards



There is one caveat, however, which is that ads, and the magazine

generally, must be in line with the brand values. Sunday supplement-type

ads for naff china dolls are given a wide berth by every car loyalty

magazine worth its salt. For instance, advertisers in BMW magazine are

typically upmarket holiday resorts such as Sandals, jewellery makers

such as Wellendorff and speed-boat manufacturers.



Since they don’t need to break even, let alone make a profit, car

company magazines can be selective about ads. A title such as Queste,

mailed to Rolls-Royce owners, is inundated by eager would-be advertisers

but sends most of them packing.



David Fernando, publishing director of Premier Magazines, which produces

Queste and VM, Vauxhall’s title, says the Rolls-Royce offering is

’hardly likely to make anyone go out and buy a Rolls or a Bentley. It’s

there to reflect the panache, exclusivity and so on of being part of a

select group, so any advertising we carry must also reflect the stature

of the brand.’



The VM title, while just as obsessed about providing an intense brand

experience, obviously caters to a much bigger and more diverse

audience.



With a circulation of 651,816, it has replaced a number of much more

segmented Vauxhall loyalty magazines as the company’s main communication

channel. The savings are reputed to be considerable, running into

several million pounds, and Vauxhall is now expected to increase the

frequency of VM from its current three mailings a year to four.



Paul Confrey, manager of Vauxhall’s newly established relationship

marketing and new media division, is in charge of VM. He says Vauxhall

has recently undertaken some strategic navel gazing and concluded that

customer retention should be given even higher priority.



Changes to VM will be just one part of a programme of marketing events

designed along these lines this year.



And while Confrey admits that a few years ago it could be hard work

fighting for marketing budget against better established channels, the

tide has now moved decisively in his direction.



’Senior decision makers at companies have come to realise that keeping

hold of what you’ve got, especially in times of media fragmentation and

TV inflation, is more cost-effective. It’s seen as a no-brainer and

anyone involved in relationship marketing and contact programmes is

pushing at an open door. Arguing my case is getting easier by the

day.’



The two-way communications channel sounds impressive, but does it

work?



Absolutely, says Jim Addison at Specialist Publications, which produces

the Peugeot magazine, Rapport. As well as running plenty of news and

lifestyle articles, it also carries a generous dollop of special offers

and promotions.



’We get a substantial number of people who write to us after every issue

(it goes out three times a year with a circulation of 250,000) and

provide loads of feedback,’ says Addison.



This might range from asking Peugeot to keep them on the mailing list

because they are moving house, to an enthusiastically returned

competition entry.



’We get a pretty dramatic response to promotions - about 8% on our last

prize draw, which would be the envy of many sales promotion agencies,’

boasts Addison.



Just as Premier Magazines works closely with GGT Direct on its VM title,

so Specialist Publications has strong ties with Peugeot’s main DM

agency, Brann.



’If, for example, we’re including a reader response card,’ says Addison,

’we’ll work in conjunction with Brann to ensure that data is collected

in a way which allows it to be easily manipulated on the existing

Peugeot customer database.’



Of course, what car marketers must not lose sight of is the emotional

experience at the heart of these publications.



Enthusiastic responses



Industry research shows that at least half all car buyers are much more

emotional about this particular purchase than almost any other - often

including their own home.



Chris Thomas, chief executive of ad agency Ammirati Puris Lintas, is

four editions into a new customer magazine he is producing for Rover’s

MG.



’It’s about fuelling people’s passion,’ he states, emphasising that it’s

not just sexy, exotic cars that exercise the emotions.



Having previously worked for six years on the Volvo magazine, Thomas

vividly recalls the ’hundreds of letters’ that would pour in from Volvo

loyalists, singing brand values like sturdiness and safety to the

skies.



But of all the justifications for having a car loyalty magazine,

Toyota’s contract publisher, TPD, must have the simplest and most

eloquent.



The rationale behind In Front magazine, says publisher Toby Smeeton, ’is

to drive brand loyalty so that repurchase becomes an instinct not a

decision.’



TOP TEN CAR MAGS

Title                                     Circulation (ABC Jan-June ’98)

AA Magazine                                                    3,986,272

Ford Magazine*                                                   769,231

VM - The Vauxhall Magazine*                                      651,816

Motoring & Leisure                                               321,547

Top Gear                                                         181,138

BMW Magazine*                                                    172,661

What Car                                                         158,265

Car                                                              117,988

Auto Express                                                      91,723

Autocar                                                           76,408

* Contract magazines



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