Magazine and newspaper publishers hate it when websites undercut their prices online, but it looks like they have a different opinon when it comes to ad creation. Last week Conde Nast announced it would start creating ads for brands — on its properties and elsewhere. The move is sure to step on the toes of agencies who pride themselves on doing just that. Now it looks like other publishers might follow suit.  

Hearst is reportedly close to sealing a deal with digital marketing agency iCrossing. But Brian Steinberg points out that magazines shifting from placing ads to creating them is not such a new thing. He writes at AdAge:

“In recent years, any number of media outlets has tried to go this
route. Rolling Stone, Maxim and Vogue have helped clients tailor their
print promotions. A Vogue in-house agency, known as Vogue Studio, even
became agency of record for a fashion designer in 2006. Time Warner set
up a corporate-marketing unit in 2004 headed by a former Young &
Rubicam executive with the goal of trying to secure additional dollars
from clients by devising marketing programs that could work across the
media giant’s many assets. Last year, NBC Universal created a panel of
popular media and advertising women — Meredith Vieira, Shelly Lazarus
and Tori Spelling among them — to advise advertisers on how to reach
female consumers.”

That said, many ad agencies aren’t going to take this encroachment too kindly. Mary Price, principal of brand media
at Dallas independent agency Richards Group tells Steinberg:

“These companies are not singularly focused on creating great work that
produces results for clients. Getting into aggregate
sales of inventory or creative production divides their focus. And
fighting a war on two fronts is seldom successful.”

Isn’t it funny how much that sounds like the argument that publishers once made about keeping their focus on the print world?

But as digital media develops, keeping business goals siloed is increasingly difficult. Publishers have learned that online and offline strategies have to work together in 2010 and beyond.

Meanwhile, brands are increasingly looking for inventive ways to break through the advertising fatigue that many consumers suffer from.

If magazines put the effort in to create interactive ad products for their own publications, they might as well let brands use them elsewhere and get a cut of the proceeds. But that doesn’t mean that advertising agencies are going to sit back and let publications cut into their business.

Like the ongoing battle between search engines and traditional publications, if magazines find success offering creative services to brands, this is likely to be an ongoing tension online. Magazines have plenty of incentive and expertise to offer in the creation of ads.

As we’ve learned from the blogging world, creating a pretty good product for a lot less money than more traditional competitors can be a pretty effective business strategy. Not that magazine publishers will remember that when the conversation shifts back to smaller, more nimble publications stepping on their business model in other areas online.