Is it time to put your magazine out of its misery? D. Eadward Tree says hold your fire – even if things look bad, you may be better off retooling your business model.
“As if plummeting ad revenue and rising paper prices weren’t bad enough, now the threat of skyrocketing postal rates has successful publishers like ESPN and Meredith talking about shutting down magazines,” he writes in Dead Tree Edition.
Yet he offers this caution: “Just because your accounting system says the magazine is unprofitable doesn’t mean you’ll be better off ceasing publication.”
“A better option may be radical surgery – dramatically scaling back your magazine’s footprint to make it more sustainable for the long haul,” he writes.
He gives four suggestions to consider, including reducing frequency to save on costs.
“Turning two 80-page issues into one 160-page double issue can cut your production and distribution costs by one-third,” Tree explains. “For example, well over half the postage for most titles is related to the number of copies mailed, not the weight of those copies.”
And you don’t have to actually go double to make this idea work. “Typical practice is to increase the page count by about 50% — enough to give the readers noticeably more than they would get in a normal issue,” Tree explains.
Another important tactic is to look closely at your subscription list to see if you’re losing money with particular customers.
“Letting people subscribe for less than the cost of printing and mailing their copies might have made sense when ad dollars were rolling in. But with that subsidy gone, sustainable publishing now means getting readers to pick up more of the tab,” he notes.
In the current market, this is a feasible idea; consumers are willing to pay for content that they care about. The days of boosting circulation to up the ad rates are gone; this new approach makes good sense.
Getting more strategic about your newsstand approach can also help.
“Magazine retailers and wholesalers focus on maximizing sales, not publishers’ profits. That means distributing lots of copies that don’t sell, which is OK for the channel partners but not so great for publishers that bear the printing and paper costs,” Tree explains.
Instead, be willing to walk away from the outlets that aren’t bringing you the sales you need to make a profit.
Finally, Tree suggests you might do more with your digital edition, like granting free access as a promotion to draw new readers in. It’s true that digital editions aren’t exactly burning up the market – but they serve as a nice entrée to a wider audience.
The most important point that Tree makes is that publishers have options. If your print publication is not profitable, consider some strategic alternatives before you self-destruct that title.