Evan Carmichael breaks down five pricing factors for magazine ad space: circulation size, audience demographics, ad size, frequency discounts, and positioning. He recommends benchmarking against similar publications and adding value through design help, social promotion, and revenue sharing to turn advertisers into repeat customers.
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5 factors to selling ad space and setting prices. So I got a great question from one of my YouTube viewers, love you guys, Able Abe Studios, who wrote in to say, "Great video, Evans. It seems like every question I search for an answer for one of your videos pops up. Very cool. My question now is if you were developing an art photography magazine, how would you go about pricing ad spaces? Would it be the size of the ad, the frequency, the creative development, or something else? Go!" So Able Abe, and for all you people out there wanting to start a magazine, magazine, here are the 5 factors you need to look at when you're setting your ad prices and trying to sell them. Number 1 is circulation. This is gonna be the first question everybody asks you. How many people read your magazine, right? If it's a, a national magazine and you're selling a full-page ad, that could be a quarter of a million dollars. If you're a much smaller magazine, that could be $10,000 or $2,000. You gotta know how many people are actually reading your magazine and the advertisers, again, that's gonna be the first thing they ask you for. Number 2 is demographics. Who is actually reading the Who is your audience? And the more specific and niche and defined it is, the easier it is to charge more money. So for example, if you had a magazine that was trying to reach really hard-to-access people, say it was CEOs of Fortune 500 companies, that's who's reading the magazine, well, your circulation's gonna be really small, right? There's only 500 people maximum who could read it, 'cause it's a Fortune 500. But that's a really targeted, select group of people that people would pay big money. Advertisers would really want to get in there and spend their cash to reach those people. So The more clearly defined your demographics are, the more you can say with the age, the sex, the, the interests and hobbies and, and more demographic information, the more you can throw out there, the better it is. And the harder those people are to reach, the more you can increase your prices. Number 3 is the size of the ad. So how much ad space are we talking about? Usually you go by percentage of the page. So if it's a, a full page, maybe that's $10,000. If it's a half page, maybe that's $6,000, right? The more space that they want, the more you charge for it. Number 4 is frequency. How often is your magazine coming out, and how many editions is the advertiser going to be advertising in it for? So for example, if your magazine comes out once a month, are they just buying in for that once, you know, they only buy for one ad spot in that first edition and that's it, or they're going to be doing it every month for 6 months, for 12 months, right? If it's a one-off deal, then you might sell an ad space for $2,000, but if it's a commitment to do this for 6 months, then you could sell that same ad space for discounted price, say $1,500, because they've committed to you for a number of months and you don't have to go out and sell that spot to somebody else. And number 5 is positioning. Where do they get the ad? Most advertisers wanna be either on the back cover, on the inside of the front cover, or as close to the front as possible. And the rates can go up the closer to the front. So if I'm getting an inside page on a national magazine, that could cost me half a million dollars. But that same page further in will cost a lot less. So you can sell your rates depending on where they are in the positioning of the magazine. So the top 5 things to look at are circulation, demographics, size, frequency, and positioning. Now the magazine industry is super traditional, uh, kind of boring honestly, and it's easy to find out what the rates are of your competition. So honestly what I'd look at is try to find somebody who has a similar magazine, similar demographic, similar size, and see what they're charging. You know, you can get those rates and charge something similar, right? You want to be cost competitive. Now, on top of that, what I'd say is, if you wanna have a lot of success with this, you gotta think a little bit outside the box. You gotta know what everybody else is charging, charge something similar, but then overdeliver on the value. Find some bonuses that you can throw in there, because most of the time, the advertisers in a magazine, they're left to come up with everything themselves, right? And the magazine does nothing to really help that advertiser out. And this is across a lot of different platforms. An example is, you know, I had these DVDs that I was selling on the Shopping Channel. And, you know, we passed all the criteria, we got on the Shopping Channel, and we were left to come up with the pitch ourselves. They didn't train us on what we needed to say, who we needed to have with us, how to make an effective sales pitch. And we probably could have sold a lot more if we had that training instead of leaving us to figure it all out ourselves. So this is going to be important, especially for first-time advertisers. They're coming to your magazine, they're not quite sure, you know, what ads are going to work, what's not going to work, who's going to reach your audience the best. Support them, right? Help them. Help them with their design. Tell them what will work and what won't work. Interview them and have bonus features of them in your magazine and have stories about them instead of just the ads. Think about how you can help them on social media, how you can plug them. Maybe you put an ad up on your website version as well. Maybe you take a percentage of the sales that come through the magazine. You have a special offer or coupon code that comes through the magazine and that's how you get paid instead of just the regular traditional rates. Show me that you care about my business. Show me that I'm more than just dollar signs for you. And if you can put that extra effort in and show those little bonus improvements there, you're not taking the traditional advertising model that all the other magazines out there are doing. You're showing me that I'm getting results, right? If I'm getting results from your magazine, I'm gonna want to advertise in there more. I'm gonna tell my friends about this awesome magazine that I'm getting huge leverage from when everybody else is failing me. So I'd encourage you to really think, how can I make sure that every advertiser that comes to me gets an amazing result for their budget and that makes them want to come back over and over and over and over and over again? And that experience is so much more important than just worrying about those 5 factors and how you're going to apply it to your pricing. So hopefully that answers your question. Continue to believe If you guys like this video and you want to see more, just like it, subscribe to the channel. Thank you so much for watching. I'll see you soon.
Hi, Raquel English here with Mermaid Junkie TV. Are you on Evan Carmichael's newsletter subscription? If not, you should be. I read every single one, and you should too. Ciao!
