Types of Revenue Model for a Top Business Magazine
Walk into a bookstore, and you’ll see that there is always a newsstand in a corner, which, apart from holding the newspaper, holds some of the top magazines. Scanning the newsstand and the magazines, what sets the weekly or the monthly edition apart from others is its quality.
It offers good paper quality, in-depth information about the topic, high-quality images, and unique opinions on different matters. This clearly defines the latency of a magazine along with playing a very crucial factor in maintaining the credibility of this medium of mass communication.
Traditionally being a part of print media, magazines have had a huge impact on creating opinions along with educating the public. The most common question asked by the common people is the revenue model of a top business magazine.
Factors like research, designs, paper quality, write-ups, analysis, marketing, sales, distribution, and many other elements require money for smooth function. If there wasn’t a revenue model, then there would not have been more than 7000 magazines published every year in the US alone.
Apart from that, there are more than 300 magazines published in India, which says that there is a revenue model that has been behind the success of the best business magazines in the world.
Structure of a Magazine
To understand the revenue generation of any magazine, let’s first explore and understand its structure. Since the traditional style of a magazine is still popular and alive, there have not been major changes in its structure.
A magazine has a cover story, profiles, graphics, in-depth analysis, charts, editorials, and advertisements. A compilation of all these things makes a magazine, and the structure might differ from one to another
Apart from that, depending on the type of magazine, the structure, and the internal content change. Magazines have become industry-related and developed a unique structure depending on the industry.
Various industry specified magazines like Insights Success, a business magazine or the Health, a top magazine from the healthcare industry, or Time a news-opinion oriented magazine. Apart from these, there are various magazines dedicated and specified to specific industries.
The basic structure of even the Global business magazine is the same, but there are only two models which generate money. The subscription-based and the other one is advertisements. Now that the structure is defined, let’s truly explore two revenue-generating factors:
Subscription-Based Model of Revenue Generation
When the print media started commercialization, the subscription model stood as the only way of generating revenue. This model is adapted by different mediums and is still in use effectively. Being a major part of the print media, magazines have readers, and they pay the magazine for every edition they buy.
A reader subscribes to the magazine subscription package, and the reader gets the magazine delivered to their door. The revenue generation from this model is directly proportional to the readership of the magazine and the production. The credibility of the magazine plays an essential role in generating revenue.
One of the best magazines, Forbes has a huge subscriber base and majorly depends on this model for revenue generation. Apart from that, almost all the magazines have this model of revenue generation. The more subscribers your magazine have, the more will be the reader base, and the greater will be the revenue generated.
The pricing of the magazine, the type of industry it targets, marketing strategy, and other factors are the basis for the success of the subscription-based model of monetization.
Advertisement Based Model of Revenue Generation
Ever scanned the magazine inside out? After every few pages, there is a popular brand that is present on the pages. This is the model on which almost all magazines depend on. It was not long before the magazine industry realized that the subscription model was enough for even survival. Since brands spend probably millions of advertisements, and the magazine has been a popular medium of mass communication, it was not long for both to join hands.
The limitation of the magazine and the costly nature of printing made it difficult for the brands to advertise themselves. The solution to this was found in its structure. Every magazine has a specific set of dimensions, and they divide the space that is to be allocated for the content, advertisements, and other essential information in the booklet. This helps the magazine in selling the space to the brands to advertise themselves.
The brands pay for the space of the magazine on which they want to advertise. The dimensions of the space, the edition of the magazine play a very important factor for the companies in giving out the spaces.
A popular business magazine, Insights Success, has a diverse range of editions that comes out in the year. This magazine depending on the edition—which is specified to industries—changes the nature of advertisers advertising on the platform. For e.g., the latest edition of Insights Success, ‘India’s Most Admired Leaders in Real-Estate’, will have advertisements of brands related to the real estate industry.
The pricing of the advertisements depends on the size of the advertisements, on which page the advertisement is going on, and the reader base of the magazine. Some major brands even pay for the whole magazine advertisement; though this is a rare and costly case, it has proven to be effective on multiple occasions for several brands.
The advertisement-based model of revenue generation is adopted by almost every magazine. Since this model generates most of the revenue, it allowed the magazines to cut down the prices it charges their customers for the subscription.
The Combined Model of Revenue Generation
Magazines have evolved with time, and that has resulted in the evolution of the revenue model. A combination of both models is seen today in many magazines. This generates revenue from both ends, which increases the efficiency of the magazine.
Along with that, in the annual audit, this model plays the key factor in knowing the insights of the magazine. The subscription model tells the management to maintain the accuracy and the credibility of the magazine.
On the other hand, the advertisement model shows where the magazine is headed. As major brands start using the magazine to advertisement themselves, it carves the path of the development of the magazine.
Magazines Adapting to the New Media
The arrival of the internet has put a question mark on the publishing houses. Though most of the magazines today are coming out online, the traditional magazine also included the digital version of their magazines in their publication.
This brought more versatility in the magazines as with the arrival of the digital version; the advertisement rate increased as the reader base of the magazine also expanded. The expansion of the magazine of digital platform marked helped the magazine to create dominance of the new media too.
The revenue model on this platform was the same as the traditional models, but the new media came with a web. This allowed the magazines to add another revenue model in their structure.
This model is the upgraded version of the advertisement model, but it was not included in the magazine as it plays a minor part in revenue generation. However, this model generated revenue from the website as it brought additional traffic on the website, and with traffic came the option of digital advertisement.
A magazine is a very flexible medium but assigning it to a niche makes the revenue generation model quite tight. With time many magazines adapted to many different types of revenue models. However, the revenue models mentioned above have remained prominent and constant throughout time.