The pressure is on for magazines to move from a reliance on the traditional twin pillars of advertising and circulation revenue, especially when there is competition for spend coming from more types of media than ever before.
In the current risk averse climate, new revenue channels can rarely mean big start up costs and a hit on the bottom line. However, it is possible to develop and maintain profitable revenue streams with low or even no risk. In fact, the good news is that there are many ways for a magazine publisher to diversify.
As publisher of Decanter magazine, I face these challenges and am lucky enough to work on a brand that has already developed several successful revenue streams that have taken on a life of their own. Outside the magazine and website, Decanter now focuses on events (including reader holidays and education) and the Decanter World Wine Awards. But we constantly look to innovate and make the brand work harder, with the aim of launching at least three new revenue-driving initiatives per year.
Sometimes, the more exciting high profile ideas are not the real money makers, especially when staff resource is taken into account. Start by analysing your magazine (and website) and identifying all the properties you already own. Areas to consider include customer data and lists, editorial / photography and, of course, the magazine’s own website.
Customer data and lists
Any magazine with a subscriber base has a ready-made list of contacts to utilise (and any magazine without subscribers should make getting them their number one priority!). Add to the mix subscribers for e-newsletters and data gathered from competitions and surveys and the magazine has a valuable commodity to play with. But what can you do with this data? Firstly, it can be used to drive revenue to other products across the portfolio through cross sales. There is also the potential to rent the opted-in list through brokers or allow partners to pay to piggy back mailings and promote products. As clients look for more customised advertising opportunities, targeting specific readers through their demographics is a new channel to increasingly direct response driven marketing.
And it’s important not to forget the mine of information hidden in your readers’ lifestyle and business habits which could be repackaged for the market. Can subscriber data modelling and / or survey data from magazine readers be repackaged into white paper reports and sold back to the market? This is successfully done by B2B magazines, but consumer titles could also use this strategy for financial gain. Reed Business Information has always capitalised on its industry knowledge through leading publications to create spin-off reports / websites and digital editions. One example is the property portfolio created around the Estates Gazette brand, which now includes seven revenue-driving products.
Editorial and photography
Once the tough work of commissioning and editing has been done and the unique magazine produced, what other ways are there to monetise the editorial product? There are a few options for a publisher that will result in very little initial cost. As already mentioned, audience data can be combined with relevant editorial and repackaged as white papers. The magazine brand could also be licensed abroad utilising a large proportion of the magazine’s monthly content. Decanter currently has one licence with a company in Taiwan which has been running successfully for several years, and brands as varied as F1 Racing and Marie Claire have successfully licensed editions in over 30 countries. The key to success is to find a partner with strong experience in magazine publishing, who understands the concept of 'brand' and how to monetise it, and with the ability to localise effectively to their market. In addition, a strong communication between publishing / editorial teams and the licensee is fundamental to success.
Photo archives, particularly on older magazines, can be a treasure trove that can easily be transformed into ancillary income. Country Life has made great use of its own picture archive to build strong partnerships with book publishers and also to create an online historical picture library where images can be researched and ordered over the internet.
Longer running magazines can also profit from putting their back issues onto disk. Rolling Stone, Playboy and Motor Sport have all produced boxed sets from their archives tapping into consumers’ taste for nostalgia.
Website and digital developments
It’s impossible to talk about creating new revenue channels without looking at the incredible potential of the web and digital versions of magazines. This is such a massive subject that I can only touch upon potential areas of interest and highlight a few that could be quickly actioned.
Continuing the theme of utilising the magazine’s content, creating a digital edition is both another route to market and another way of creating a further source of income from the same magazine. There are many digital magazine providers, including Zinio, who IPC Media uses. Technology is still limited but production and upload are easy and, particularly for magazines with an international market, this could provide another drip feed of revenue.
Looking at magazine websites, what opportunities are there besides straight advertising and sponsorship revenue? Well, working with partners to provide services can be a good option, as seen in the white label dating and dieting offering on many women’s sites such as womanandhome.com. Or perhaps a wine club like those of the Week or Private Eye. All of these ventures are run by partners who provide the technology and expertise, while the magazine site provides the customers for a cut of the revenue.
Affiliate click-through partnerships can also provide a similar type of income, again at little cost / risk. Partnerships with companies like Amazon and Google provide another revenue stream to add to the pot, though this is not an area likely to make millions.
One note of caution. The dotcom explosion has proven to be both incredibly expensive and very low cost depending on your strategy. A careful consideration of launch cost and predicted return is key.
Events and other ways to bring the brand to life
Many magazines, such as Decanter, have diversified successfully into managing events, including awards. Moving in this direction doesn’t have to mean a big initial investment as an event can be launched on a very small scale and after partner sponsorship has been secured. Many traditional print publishers have found that advertisers are looking at new ways of reaching the market and bringing their products to life. Events are often the best way to continue to attract this advertising spend. Be aware though that launching an event, especially without a dedicated team, can be a drain on staff resource and often, no matter the size of event, at least one person will be working into the night on last minute preparations!
What kind of event to launch depends on what your magazine is best able to deliver. Most consumer titles are in the unique position of being able to offer direct access to consumers with a specific interest. Decanter has capitalised on this by partnering with wine partners to stage tastings and launches for both consumers and also those working in the wine trade. We always aim to give our events the Decanter stamp and deliver something our visitors would not otherwise be able to experience.
It is also worth considering what other brand commodities could be used to earn revenue. Does the magazine already own a “Top 10” or awards franchise that is keenly followed by consumers and the industry? If so, this could be monetised by staging an event around the franchise and encouraging either paid for entries or sponsorship – John Lewis’s longstanding sponsorship of the InStyle 100 Best Beauty Buys is a good example of this.
Similarly, revenue could also be earned from licensing the magazine’s endorsement of products. Decanter prints millions of bottle stickers per year which are sold to winners of the Decanter World Wine Awards. Many winning producers have happily endorsed the stickers as they see a rise in sales for bottles carrying the Decanter logo. As a low cost venture, this is definitely worth consideration.
Conclusion
Far from revenue on print magazines being limited, there is an enormous potential for growing revenue streams. And what’s more, expansion doesn’t mean high cost and high risk. When a company relies greatly on one major source of income, its stability is challenged. But by expanding to include several strong revenue sources, magazine publishers can build a multi-media brand around their readership and create a more sustainable business model that is less susceptible to dips in advertising or circulation revenue.
What will be in short supply is time to get projects up and running. So perhaps shorter lunch breaks!
