Advertising and Market Share

[Bob Keller]

And that sound like a good place to wrap this thread up ...

[:)]

[nblum]

Sour grapes are always less interesting than fine whine :). Anyhow, arrogance is hardly a monopoly of the Lionel staffers or followers. Just check out the DCS forum on the OGRR Board (DCS is so superior to TMCC we cannot deign to hear any arguments to the contrary) or any of MTH's advertising for the 1990s and early 2000s. They've probably patented arrogance and a new lawsuit will be forthcoming shortly.

Sure Lionel followers and Lionel are arrogant. They've got to keep up with the Jones :).

[trigtrax]

So, this is personal? Because you don't think you're a priority for Lionel, you're letting it affect your choices of new products and reviews?

My first thoughts were perhaps Lionel was not aware you would do product reviews without advertising.. But you have cleared that up.. Since you've talked to Jerry's assistant you've made more than enough effort in this area.

Questioning Lionel's priorities is a foolish enterprise.. Some quotes from past CEO's brings that out..
Gary Moredough... "We're it and that's All"
*** Maddox......... "You're Lionel, you can do whatever you want"

Obviously some of their fans hold the same mindset... they don't need to advertise, they're Lionel.

So why place blame on the editorial staff of a special interest magazine? Why insist they spend their money to cover products that are so superior anyway?
The arrogance of Lionel and some of their followers never ceases to amaze me. They got nailed in a public trial, they're sitting in Chapter 11, they're bleeding money and still the chant "We're Number One".. Keep on keeping on, boys [:D]

[Poppa_Zit]

I also appreciate the opportunity to participate in a great discussion.

I'm in the same business as Bob. As a longtime subscriber of CTT, Trains, MRR and CT, of course I have the right to have some expectations. I subscribe to CTT even though I'm an S gauger and in my opinion they don't offer enough about S scale.

Oh, we S folks do have a publication -- S Gaugian -- that, unfortunately, is about as journalistically weak as it can get, and that makes me even more frustrated.

[Frank53]

That's an excellent point Neil, and not one that should go unoted. You would not see this discussion on other magazine sponsored forum(s).

[nblum]

I'd like to thank everyone, in particular Bob Keller, for frank and open discussion of a potentially difficult topic. The hobby could use more open and civil discussion of the many difficult issues that are simmering, IMO.

[Poppa_Zit]

QUOTE: Posted by Ogaugeoverlord:

I know you're trying to make this our fault, but all we can do is offer the coverage to the manufacturer. It is up to them to participate, especially since it doesn't cost them anything.

You're wrong. I'm not trying to delegate blame. I'm trying to get someone to take responsibility.

There's a big difference between "offering coverage" and creating salient editorial content, which is the main function of any editorial staff. Reporters don't sit in the office with a catcher's mitt, just in case a story comes by. Reporters go out and dig for the news. Whether it costs the manufacturer anything isn't the issue here, and since you can purchase the products (maybe at a discount) from one of your advertisers, it is not up to Lionel to participate. That's a very cheesy excuse.

As for news photos, I know I like plunking down good money for a magazine, just to see the same photos in their products news sections as I'll discover in the train-maker's catalog. Yessiree, I know that buying the same photo twice is money well used.

For the last decade I have sparingly used provided images mainly because the images manufacturers provide, are photos from catalogs or ads. I prefer to shoot a unique product photo as an extra value for our readers. This allows them to see the photo in the catalog or advertisement and compare it with the image in our magazine.

Great! Then hire a freelance professional photographer once in awhile and make an appointment for them to visit the manufacturer to take a product photo! What's so difficult about that?

[Poppa_Zit]

QUOTE: Originally posted by Allan Miller

Interesting to see how some folks try so hard to make Lionel's lack of advertising and refusal, or perhaps inability, to send products for review look like it's all the publisher's fault. Talk about feeble attempts at spin!

I don't think this comment was directed at my post, but here's the rub -- it is the CTT editorial department's job to provide interesting, topical and timely coverage of the toy train industry and NOT sell trains for anyone. CTT might have a case for being an industry shill -- and I am not saying it is -- if the CTT magazines were supported solely by advertising and given away for free. Since I pay for a subscription, I have reason to expect CTT does everything possible to deliver editorially that interesting, topical and timely coverage of the toy train industry.

And if that includes buying items to review to deliver for your paid subscribers, so be it. If there's not enough money currently in Bob's budget to do that, then he needs a bigger budget to perform his job properly. But lack of dollars in a case like this -- what, a thousand or two a month? -- is not an acceptable excuse for not reviewing Lionel's or anyone's products. Sorry, but that's the spin you should be highlighting.

Consumer Reports doesn't get any advertising revenues like CTT does, but uses its subscription dollars to buy products to review. CTT has it coming in both ways -- subscription/POP sales and advertising. It's awfully hard to lose money on an issue when you can adjust the page count based on total ad pages.

[Frank53]

QUOTE: Oh, well.Well I can sure understand why a company in Chapter 11 would want to avoid free placement of their product in a magazine reaching the largest segment of the toy train hobby for what, 15 months?

If I'm a Lionel PR guy, and I read that, I would figure that the opportunity for an unbiased review is pretty much zero. Sounds like a bowl of sour grapes to me.

The salt-rubbing over Chapter 11 was a particularly nice touch.

This whole thing strikes me as being relatively easy, as no matter how big the companies are, it's a small industry.

You pick up teh phone and call Jerry C. "Hey Jerry, Bob Keller, CTT." I want to get together with you for lunch and talk about trains and Lionel and CTT. What works for you?"

If I'm Jerry C and the publisher of the biggest mag in the industry calls and wants to break some bread, I'm all for it.

You get together and tell him you want them to submit some products for review. Tell him you haven't received any for a long time and you've been harranging the marketing people for them without success. "Jerry, do me a favor, get so and so on the phone and tell him you want the products sent to us. He'll do it if the request comes from you."

Now, either Jerry has to say "Bob, we don't think your mag treats us fairly" or he makes it happen. If he says they don't want to, you find out why anmd chose to either fix the problem (actually change the perception, as no mag should bend to insistance of a positive review) or you at least both know where you satnd.

I serously doubt this thread isn't in Jerry C's email already.

"So Bob, why do you keep beating the dead horse about the Chapter 11 on the CTT forum. You know what that's about - why stir the pot?"

um, er um

Point being, two people sit in the same room and figure it out, instead of all this sniping.

I hope the response to this isn't Jerry wouldn't take the call.

[trigtrax]

Anyone with a basic concept of business and sales promotion understands that.

LOL!! How foolish of me all this time I was under the mistaken notion the idea of being in business was to make money.. Only now do I find out the secret is to lose it.. Dang [;)]

[prewardude]

Has it occurred to anybody that maybe the reason that Lionel isn't advertising in CTT in these tight financial times, is because they don't have to? Their name is on the cover of every issue of CTT, for goodness sake! Has there ever been an issue of CTT without the Lionel name on the cover? I doubt it.

Just a thought...

Regards,
Clint

P.S. With regards to not sending any product in for review... I don't have an explanation for that one. That's just foolishness on Lionel's part, IMO. Okay, I'm done. [:)]

[Anonymous]

Interesting to see how some folks try so hard to make Lionel's lack of advertising and refusal, or perhaps inability, to send products for review look like it's all the publisher's fault. Talk about feeble attempts at spin!

And it's hard to imagine a corporation or corporate executive being so thin-skinned that they would back off supporting the main publication in the hobby (the one with the largest circulation) simply because something was said in an editorial, or elsewhere, that they didn't like.

[Bob Keller]

Actually, PZ, I do have a budget for buying products and the coverage of Lionel items you've seen in the magazine is the result of that.

I'm not, however, going to drop the year's budget on one or two high-dollar items from any manufacturer. Recent purchases include track, rolling stock, and locomotives like the B6 0-4-0, the hotbox car and the S-2 electric which you'll see in reviews.

I know you're trying to make this our fault, but all we can do is offer the coverage to the manufacturer. It is up to them to participate, especially since it doesn't cost them anything.

As for news photos, I know I like plunking down good money for a magazine, just to see the same photos in their products news sections as I'll discover in the train-maker's catalog. Yessiree, I know that buying the same photo twice is money well used.

For the last decade I have sparingly used provided images mainly because the images manufacturers provide, are photos from catalogs or ads. I prefer to shoot a unique product photo as an extra value for our readers. This allows them to see the photo in the catalog or advertisement and compare it with the image in our magazine.

BTW I give Don Thompson at S-Helper two thumbs up for recently shooting an exclusive image of his 2-8-0 (S-Helper didn't have one in the US to send us) for our lead shot in the May News.

And, PZ, I don't think there is anything that isn't editorially neutral in my remarks. Like they say in the TV ads, if you don't enter, you can't win. If I don't have the products to shoot (and return, by the way) for news or to test for reviews, the odds slim they will make it into our magazine. A simple fact of life.[:D]

[Poppa_Zit]

QUOTE: Originally posted by Ogaugeoverlord

Gee, its been well over a year since Lionel sent us anything for product review - imagine the impact of our readers could actually see more Lionel products reviewed in CTT, and not just read about those products in ads ....

Oh, well.Well I can sure understand why a company in Chapter 11 would want to avoid free placement of their product in a magazine reaching the largest segment of the toy train hobby for what, 15 months?

Makes sense to me.

Whoa! Pretty interesting comment from a person who is supposed to be editorially neutral.

If there truly is no relationship between advertising and editorial at CTT/Kalmbach, as it should be to protect the publication's integrity, the editorial department would have a budget for purchasing products to review -- just to keep some balance to maintain an air of propriety. You embark on a slippery slope when you review only products submitted gratis. That opens the door for a manufacturer to send you only pre-tested products which will perform perfectly, which may or may not be the same as what's on the shelves for us to buy. It also discriminates against certain manufacturers, doesn't it?

There also seems to be some confusion on your part between the departments "new product news" and "reviews." You don't need a physical sample for "new product news" -- a photo and press release is all that is required. That's because the sole purpose of "new product news" is to alert readers of new things they may purchase. It is not intended to be construed as any type of endorsement. I can't believe that Lionel -- when requested -- doesn't supply you with these materials.

On the other hand, the purpose of a "review" is to offer a fair and balanced assessment of a product based on unbiased physical examination and testing -- and is not intended to sell that product for the manufacturer. By limiting your reviews to products that are submitted free, aren't you doing your readers a disservice for the above stated reasons?

QUOTE: Yep. I've spoken to [Jerry Calabrese's] personal assistant twice. Etc. etc etc.

As I've said when this topic has come up in the forum previously, I don't think we're a priority for Lionel - their attention is elsewhere.

Speaking as the guy who does the product departments, thank goodness for Atlas O, MTH, Weaver, Williams, and everyone else who does have a product to sell.

So, this is personal? Because you don't think you're a priority for Lionel, you're letting it affect your choices of new products and reviews?

"Imagine the impact [if] our readers could actually see more Lionel products reviewed in CTT..." So we don't -- because Lionel won't send you guys freebies to play with? Your job as editorial staff isn't to sell products for Lionel -- it is to provide timely and topical information to your readers. Remember, while the manufacturers buy ads, we buy your magazines.

[Warburton]

A very interesting forum! I heartily agree that the dealers are not buying as much ad space because they can post their latest offerings more cheaply and quickly on the internet. I've mentioned this before in the forum. CTT and OGRR have a problem here and I'm sure they are trying to address it. They are not alone in this; other hobby mags face the same problem (photography comes to mind). Unfortunately, subscribers are going to have to pick up more of the publication cost to help cover this advertisiing shortfall.

In regards to Mike Wolf being a "train guy" and having a big leg up because of it, I think that's overblown. Josh Cowen himself, as far as I ever learned, didn't have a layout at home -- hardly had any trains at home period. He probably saw enough of them at work every day. He certainly new how to fix them, etc., but his genius was in marketing. I'd rather have a marketing genius running Lionel than a "train guy" any day!

[Frank53]

QUOTE: Originally posted by trigtrax


For some reason folks seem to think these numbers don't matter but they do.

they don't. Anyone with a basic concept of business and sales promotion understands that.

[trigtrax]

Lastly, if anyone thinks that Lionel "can't afford" to advertise because of Chapter 11, you're dreaming. The realtively small amount of money required to have a continued presence in industry mags doesn't make a difference.

According to their filing they lost 400K in Jan. And 800K in Feb. And that's after coming off a loss of over 5 Million in the preceding year. A page of 4 color in OGR costs something like 2 grand and CTT is probably double that. For some reason folks seem to think these numbers don't matter but they do. And the idea of Lionel Advertising isn't so much preaching to the choir.. Ads from Williams, MTH, and Atlas go unanswered.. The consumer has no reference to apply to them.. As far as depending on the internet, for younger demographics you can get away with it.. But this hobby has an older mix, I'm always amazed at York at how many of my customers are not on line.

[Anonymous]

Lionel probably figures that placing advertising in the hobby magazines is akin to preaching to the choir. What they don't seem to realize is that it's in their best long-term interest to keep the choir singing their tune, and on tune, as well.

Little wonder, too, that so many people not in the hobby, or just being exposed to it for the first time, are still surprised to learn that Lionel is still in business. Just a couple of days ago I had a long-time model railroader in another scale ask me if Lionel was still making trains. That, in itself, is kind of revealing.

[Frank53]

Being the biggest name in the hobby and one that spans generations, Lionel advertising to the die hard train folks doesn't seem to make a lot of sense anyway. When Lionel introduces a new product, those who follow the train hobby find out about it on on-line forums and internet sites as soon as someone gets their hands on it and takes it for a spin on their layout. Why wait the ten or fourteen week lag time it takes a magazine to review teh product and then work it into their publishing schedule?

As for new hobbyists, that buying decision is going to be made at the local hobby shop anyway. If the nearest hobby shop has an MTH bias, the customer is going to get sold on MTH by the "knowledgeable professional" at the local hobby shop. Vice-versa if it is a Lionel dealer.

As far as sending in product goes, as stated above, why bother. By the time it gets published the story is out and has been presented by those who have been running the product. What good would an Acela story do on CTT now, which is probably still too early for it to be worked into a schedule?

Plus there is an intertwining can of worms in accepting a Product Review anyway.

Lastly, if anyone thinks that Lionel "can't afford" to advertise because of Chapter 11, you're dreaming. The realtively small amount of money required to have a continued presence in industry mags doesn't make a difference. With big dealers footing teh bill for pushing Lionel product to their customers and fighting amongst themselves to undercut each other, it's clear Lionel's primary customer is the bigger dealer. Lionel's best money is spent on expansion and solidifxation of teh dealer network, as the dealer is teh customer, and the individual train guy is the dealer's customer.

[nblum]

"I've noticed a few fanatics who keep claiming MTH is in trouble but I see no signs of that."

Suggest you read Mike Wolf's interview in INC magazine last year, it will provide you with "signs" and the data I cited above. But perhaps you consider Mr. Wolf one of those fanatics who keep claiming MTH sales dropped by half from what they used to be? ;)

[nblum]

Well, Bob, I'm glad I raised the subject nonetheless. Even in its somewhat reduced length, I look forward to CTT more than any other magazine I read, including the New England Journal of Medicine. Especially the New England Journal of Medicine. ;).

I've disagreed with a few aspects of reviews you've done in the distant past, but I'm still of the opinion that it is to both CTT's and Lionel's benefit to see Lionel ads and product reviews in the magazine on a regular basis, legal fees allowing for the former.

[trigtrax]

And Nassau Hobbies has a large MTH department and an MTH display layout,

You're placing the cart before the horse.. Nassau Hobbies Sells trains, All trains.. It happens that a few of the railroad clubs on Long Island strongly favor MTH over Lionel and Charlie follows his customers..

As far as side by side comparisons these are private companies and are not required to release financial data... Lionel must make it's dealings public because they are seeking the protection of the courts and those are the rules.

I've noticed a few fanatics who keep claiming MTH is in trouble but I see no signs of that. They have expanded into Tinplate, Large Scale and HO.. They seem to keep tight control of their production and have less Bigtime Blowouts.

One thing is certain to me you will never return to the days where a single company dominates this market. I'm not sure the current owners of Lionel can operate under those conditions. Most moves they make seem to want to return to life under the old rules.

[Bob Keller]

Yep. I've spoken to his personal assistant twice. Etc. etc etc.

As I've said when this topic has come up in the forum previously, I don't think we're a priority for Lionel - their attention is elsewhere.

Speaking as the guy who does the product departments, thank goodness for Atlas O, MTH, Weaver, Williams, and everyone else who does have a product to sell.

[nblum]

"Makes sense to me."

I was just raising the possibility. It doesn't make business sense to me either. It's a puzzlement to me why they wouldn't send you products for review. Perhaps it's an ethics thing. If they don't advertise, they don't feel it's ethical to have you give them free advertising through reviews.

Has Neil B. called Jerry and asked them to send stuff for review, regardless of advertising placements at this point in time? Seems it would be worth the phone call, if only to touch base. Nothing like a chief honcho to chief honcho conversation to clear the air. I do it with some frequency in my job.

[Bob Keller]

A CTT editorial ticked them off, Neil?

Well I can sure understand why a company in Chapter 11 would want to avoid free placement of their product in a magazine reaching the largest segment of the toy train hobby for what, 15 months?

Makes sense to me.

[Anonymous]

Then again, it could just be that dealers need to advertise Lionel stuff so they can move it, and that MTH items sell well enough without the additional push. [;)]

[nblum]

"Gee, its been well over a year since Lionel sent us anything for product review - imagine the impact of our readers could actually see more Lionel products reviewed in CTT, and not just read about those products in ads ...."

I agree, the lack of product reviews is a negative, particularly given the enormous focus on Lionel in articles and ads in CTT. I would urge Lionel to send products to CTT for review. Frankly I could see why they might not send review products to OGRR given the hostile atmosphere amongst some of the readers, on the OGRR Forum and amongst some of the dealers. Is this recent lack of products for review because Neil Besougloff's editorial about the lawsuit ticked them off, or are they just being cheap? One way or the other, it's time for Lionel to again start sending products to CTT for review, IMO.

Advertising and reviews play roles beyond short term sales, and keep the company and product in the public eye.

My point was more to measure where the hobby and industry are going than to argue the pluses and minuses of print advertising. Dealers, particularly large dealers, are buying more Lionel product to sell "on spec" or for stock than they are buying MTH product for stock. That's what the ad pages confirm for us. As long as dealers are advertising there will be trains to be bought for those who don't pre-order. That's an important indicator of the health of the hobby and each company's sales. When dealers cut back drastically on advertising or stop advertising we'll know the apocalypse in toy traindom is nigh. It isn't that bad yet.

[Bob Keller]

Gee, its been well over a year since Lionel sent us anything for product review - imagine the impact of our readers could actually see more Lionel products reviewed in CTT, and not just read about those products in ads ....

Oh, well.

[Anonymous]

I certainly agree with you, Jon! No valid inferences at all can be drawn from dealer ads, aside from the logical assumption that Charlie Ro is naturally going to run Lionel ads since he's primarily a Lionel dealer, and Ready-to-Roll is going to focus on MTH since they're primarily an MTH dealer. What's in the ads, or the number of pages purchased for an ad is in no way indicative of the actual sales of the respective products. In the best of all worlds, these folks wouldn't even have to run large or frequent ads because they would be selling stuff as fast as it came into the store.