Michael Lavery: President & Managing Director, AUDIT BUREAU OF CIRCULATIONS
Following a series of circulation scandals, he presided over a rule change that caused an industry to scramble over how to classify their sponsored circulation.
"Our board and its advisory committees created a category to include in ABC’s report and provide information that is meaningful to advertisers and publishers," says Michael Lavery, president and managing director of Audit Bureau of Circulations. What Lavery is referring to is the creation of the "Verified" category, a move that last July threw the circulation industry into a tizzy over how and when to recategorize sponsored circulation.
Despite the initial outcry, it was, says Lavery, a solution that played to the desires of both advertisers and publishers. "I think it expands the recognition of the value equation for both advertisers and publishers to beyond just looking at how much somebody might have paid or whether they paid at all," he says.
Last July, following a series of circ scandals, the ABC board voted to change rules pertaining to sponsored sales;essentially how third-party consumer magazine sponsor programs qualified as paid circulation. Sponsors must pay, verified public place does not.
For Lavery, the rules change will have an impact on how ratebase is ultimately valued. "Ratebase for many magazines has historically been looked at in the context of paid circulation. And I think we will speak more about audience than just payment."
According to Baird Davis in a report for Circulation Management last October, the estimated amount of sponsored circ was 17.5 million for the first half of 2005. Davis echoed many publishers’ panic over not only making ratebase, but making the July 18, 2005, cutoff. "This will have significant ramifications concerning how publishers address the ﾑpaid’ ratebase issues involved," said Davis. "Will they reduce ratebases? Will they maintain ratebases by replacing the sponsored circ with paid circ?"
VITAL STATS: In its decision to revise the rules pertaining to sponsored magazine circulation, ABC affected how an estimated 17.5 million copies are classified.