Gordon Woolf's Blog

How to work out what to charge for ads

Magazines provide a fascinating problem for anyone interesting in the mathematics of costing production. That's because there are so many variables.

Think of this: you plan a new magazine and you follow the usual practice of giving discounts for larger advertisements. Or maybe you work it out the other way: $500 for a full page, $260 for a half, $150 for a quarter, $80 for an eighth-page. Now you reckon that most of your ads will be small sizes, but then in come the orders for full pages and someone asking what's your discount for a double page spread (a "truck" they may call it). Instead of celebrating you suddenly realize that instead of getting upwards of $650 a page, you are giving discounts below $500.

That truck is driving straight through all your cost estimates, accompanied by a dozen Humvees. You may save a little on the time of putting one ad on a page instead of placing 6 or 8 little ones, but you may also find that the advertisers or their agents are ultra critical on proofs and the quality of the final job. Then you realize that those full page advertisers placed orders for 3 or 6 or even 12 months and your revenue is disappearing fast. Your costs may be going down a little, but they'll still want to keep changing their copy.

Fortunately there is a calculator around to help. The Adrates calculator is not completely free - it comes as a free download with copies of How to Start and Produce a Magazine or Newsletter and is an Excel spreadsheet that lets you do all those what-of calculations before you start telling people what your rates are (or helps you work out what they will have to become if you already have a publication).

Enter your suggested full page rate and the percentage extra you will charge for smaller ads and the discount you will give for series ads. Guess the percentages you may get in series bookings (you can play around with all these figures as much as you like) and the spreadsheet will give you a guide to what your rate card might look like.

Then, and this is the clever part, it will tell you, based on what percentage of pages you intend to devote to ads, how many pages of ads you will need. Then you can enter all kinds of combinations of the sizes they might be. If you go over the total it will tell you and it will give a cumulative total as you enter the numbers of ads.

Finally it gives you the total income at full rates, and then, the really important figure: based on your previously entered proportions of repeat ads, it gives your likely revenue per issue. And that is the figure which may come as a shock.

Of course you can then work out what happens if you get an extra full page. Sure, the revenue will shoot up but there is the calculation this spreadsheet does not do for you: what effect does it have on your printing and other production costs (especially if it takes you into the next postage category and you have a lot of mail subscribers).

This isn't a magic solution, but it will help with calculations that every magazine and newsletter publisher has to do at some stage, even if it is on the back of an envelope.

The book is available from Worsley Press or from Amazon, at US$26.95 and there's a lot more help than just this spreadsheet.

But first, have a look at the Adrates file (Download Adrates) which shows how the spreadsheet works.

 

Oh no! Not the 'Under New Management' Sign

In my book Success in Store both I and my co-author separately berated anyone who'd even consider a sign stating Under New Management.

If the business was good then you do not want to make a point of saying that the old owner has gone; customers, even those who are not actually dissatisfied, may take it as an opportunity to just drop off, to try that other shop they've been thinking of going to.

If the business was bad, then if a sign with those words is all you can do to make it appear that things have changed, then you may appear to be doing the same old things in the same old way.

But this sign is a play on the theme. It's big, on a busy road where it stood out even to people like me who had not noticed the business as it was. But it makes a strong point and it is in a field where many such businesses in Australia were taken over by huge groups who seemed to have money to burn but then burned out. It can therefore be a good idea to promote the benefit that the "new" owners are in fact the old owners who knew what they were doing.

We hope it helps. 

What's the production schedule for a publication?

I was asked what a typical production schedule for a magazine would look like.

I doubt if there is actually such a thing as a "typical schedule". Most that I've come across start with a simple list working backwards from the print date to the date on which final ads and editorial have to be with page production.

Then both advertising and editorial section will calculate back from that to have separate schedules.

However this is something which should be considered carefully not only in the planning for a new publication but also at other times by every publication. And schedules all have to bear in mind that only a few final items can be prepared on that deadline.

In advertising it is normal to set a deadline a day or two ahead of the date required by the production department, and the following wording occurs in many sets of conditions (this is for a weekly published locally on a Friday):

Preferred deadline for the receipt of all advertising materials is Friday, seven days before publication. Materials and space reservations will be accepted, however, until 5 pm Monday, week of publication. When space has been reserved and paid for by Monday, camera-ready materials can be accepted until 4 pm Tuesday, week of publication. Electronically submitted ads for which space has been reserved must be received by 1 pm Tuesday. Cancellations and changes cannot be accepted after 5 pm Monday, week of publication. For advertisers wishing to approve a proof, the deadline is noon Wednesday, nine days before publication. Major holidays that are celebrated on weekdays generally cause the deadlines to fall one business day earlier.

You will find many such schedules in the online conditions of publications.

There are also likely to be earlier deadlines on small display ads and perhaps later ones on classifieds which are just run in automatically by system software.

In editorial, magazines will tend to work in production runs even though all the runs may be on the press at the same time. So there will be perhaps on a 64-page magazine deadlines each day for perhaps 16 pages. The deadline given for editorial submissions would normally be a week or more ahead of the earliest of those dates for regular contributors who can be relied on to meet deadlines, a week or two further ahead for contributors who are not yet trusted, and then another couple of weeks further ahead for anything which is being considered at an editorial conference or on which the editor has yet to make a decision.

All these dates will normally be indicated by marks or stickers on a wall planner -- I have come across publications using computer scheduling but it is too easy to ignore something that is not constantly in the face of the actual users.

A production run which is a physically separate run on the press, even if only a day earlier, will usually be regarded as a separate production process to be completed before the final section, and so will most likely have a deadline at least a week before the rest. It can almost be regarded internally as a separate publication.

It basically comes down to ensuring there is a steady flow of work for each person in the process, so not only does the person setting the schedule have to consider what amount of work is possible in the time, but also what those people will be doing at other times. That is why it is common for feature pages of daily newspapers to be scheduled for all work to be completed two to three days ahead of the news pages. News pages will also have a succession of deadlines -- and the only pages actually prepared on deadline for a daily newspaper are likely to be the front page and the main sports page.

Despite the common impression that publications are a frantic hive of activity on deadline, any publication which is like that other than when a disaster occurs just ahead of that deadline, has a production schedule which needs work. I've worked on magazines where final deadline day can be very quiet, a time for long lunches because those in charge of checking final proofs just need to know where everyone is in case there is a query. A newspaper may be very quiet after midnight with just a late copyeditor watching the wire service.

On the other hand, if unexpected news breaks just as the deadline approaches, then real life may resemble the newsrooms of the movies.

Magalog or catazine - good idea but not a new one

There's nothing new under the sun. That was my reaction when I read a US Postal Service blog suggesting the latest trend was the "Magalog" or the "Catazine", a hybrid of catalog and magazine. My reaction was thus because this is how one major category of magazines, the trade magazine or trade journal, started a couple of hundred years ago.

The Morgan brothers, who ran a business which combined the categories of druggists and hardware sellers, decided back then that they'd get more readers and more committed readers for their catalogs and thus more customers if they included news and information. And that meant news etc that was not just puffery for their products.

In the 1960s I worked in London for the firm of publishers which had been, a century earlier, that firm of chemists. Those catalogs became the world's first trade magazines, The Chemist and Druggist and The Ironmonger. As they became successful in their own right, they split from the chemicals company (which became Morgan Crucible) and the one which became Morgan Brothers Publishers (and subsequently the Morgan-Grampian Group, now part of Fleet Holdings).

When I started work for the descendants of the Morgan Brothers (Sir Charles Morgan Hudson was the chairman) I worked on The Ironmonger and they were approaching their centenary year as publishers. They set a high standard with an editorial staff of around ten on that magazine alone, a supplements department with two or three (I worked for that section for a while and wrote a 64-page guide to glues and adhesives - exciting stuff!) and an inquiry department with 5 people fulltime answering phone and mail questions from subscribers.

It was definitely profitable and as a young reporter I was sent UK-wide reporting on the meetings of hardware retailers and ironmongers. When John Betjeman (later appointed Poet Laureate by Queen Elizabeth II and following on previous appointees to that position such as Tennyson, Wordsworth and John Masefield) called for some information in order to write his speech to open an exhibition of Opercula (perhaps better known as "coal hole covers" those often ornate cast iron plates set in footpaths in front of houses above the coal cellars) I was told to find the booklet on that subject we had published long before, try to find some updated information and arrange to meet him before the event and then report on the opening. It took many hours and resulted in about a 6-inch story.

But that was the way things were in those profitable days. Maybe some of the "new" catalogues with news will do as well. As long as they follow the basic rule that the Morgan Brothers followed, that there must be no puffery. Readers had to be respected.

I'd suggest that a good start might be not to call the new publication a "Magalog" or the "Catazine".

In search of funding

Maybe it's a little out of the normal run of production problems, but I had a reader recently point out that one of the major production problems for a small newspaper can be to have the funds to go on producing the paper.

That's a good point. I have come across newspapers that have received arts council and local education grants for things like running an arts page or a page (and sometimes a lot more) for one or more local schools -- especially if they involve the students doing most of the preparation work (I've been paid a few times to go along to schools and explain how a newspaper is put together).

I've also seen schools and other organisations divert funds they used to produce a newsletter to a newspaper which agrees to run a regular column.

However, in general, appeals for "support" don't seem to work in the long term -- much better is to encourage people to show their support by placing paid classifieds whenever they have something to say, something to sell, or someone to thank.

For a local publication, or one which serves a very specialised field where a number of people agree that they would lose substantially (either economically or socially) if the publication ceased, there could be an argument for a "Friends of ..." organisation that maybe gives some benefit such as discounts of some kind that don't cost the publisher anything.

You can also chase local politicians for inclusion on government advertising budgets, though this money seems to be getting much harder to get.

I have to admit that this isn't covered in any great depth in my book How to Start and Produce a Magazine or Newsletter although that does cover  much about setting ad rates, selling ads and considering the general economics of publishing.

How to make great ads

First I must declare an interest. The new ebook How to make great ads for (sm)all business grew out of my book  Success in Store, with co-author Geoffrey Heard, but this is entirely Geoff’s work. It consists mainly of short tips with examples from real life of what to do (and a few of what not to do). Most of the examples are of ads for small businesses and it is intended to be digested in small bites – taken a spoonful at a time, which suits ebooks, rather than read in a continuous session. You can download a free extract – a 30-page selection – and that should give you enough ideas to pay for the book several times over, because the full book as a download costs you only US$5.95 See details at worsleypress.com