The total value of the customer publishing industry is estimated to reach £1 billion by 2011, according to new research carried out by Mintel.
The research, commissioned by the Association of Publishing Agencies (APA), also forecasts that by 2011 turnover will exceed £541 million, an increase of 54%.
The industry is currently worth £680 million, with turnover of more than £352 million, a 2.2% increase on 2004. Mintel says that this increase is double that of overall advertising expenditure over the same period.
The growth rate is attributed to both increased spending by companies already utilising customer publishing (76%) and an influx of new businesses trying it out for the first time (73%).
Mintel says that new customer magazines now represent one third of all titles produced by customer publishing agencies, compared to 11% in 2004.
Printed media remains the cornerstone of the customer publishing industry, despite the growth of alternative media channels such as the internet, accounting for 90% of all titles.
However, just over 50% of customer publishers said that they feel there is scope to convince existing clients to increase their online spend or attract new online customers.
Retailing and financial services remain the two largest sectors in the industry, making up almost 30% of the market between them (15% and 14% respectively).
Since the last Mintel report, the automotive sector has experienced the most growth, rising from a 5% share to a 9% share of the market.
The Mintel research also shows that customer advertising is becoming less reliant on third party advertising for funding publications, with approximately 32% of revenue accounted for by advertising, a 7% decline on 2004.
Julia Hutchison, COO at APA, said: “Not only are clients becoming more aware of the benefits of customer magazines, but we’re also seeing increased acceptance from media agencies.
“One of the main reasons why customer magazines are being regarded as such a valuable weapon in the marketing armoury is that they open the door to a more subtle and interactive dialogue with customers. They are seen as a non-threatening method of contacting a client’s customer database and regularly reminding them of products and services without the hard sell.”
Hutchinson added: “In comparison to other media this industry is showing healthy year on year growth, a trend we expect to continue. I believe it will be a prosperous and exciting year for this industry and the newly expanded APA is working hard to deliver to members and the industry a portfolio of services that will help support and grow the medium in the long term.”
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