The Three Steps to Make Print Work

Before we begin, I’d like to ask you to mark October 15th on your calendar. That is when the AMO Summit will return to New York City. I’ll have more to share soon, but I wanted to get the date on your calendar as soon as possible. Okay, let’s jump in…

If you had asked me when I launched A Media Operator four and a half years ago whether I’d give a presentation about print, I would have looked at you like you had three heads. Yesterday, I found myself standing in the theater in Hearst Tower, giving a presentation to the MACMA audience, talking about three things I am paying close attention to in the media world.

One of those key things is the return of print. While I am not going to say that magazines will return to their glory days as consumer products, there is no denying that there is a model where it can make a lot of sense.

But let’s take a step back and understand what went wrong with magazines originally. Fundamentally, it boiled down to the economic model of magazines.

In essence, the strategy for print was to achieve scale so that ads could be sold for higher rates. So, the way to make more money as a publisher—beyond adding more pages to the product—was to grow the database to increase the cost per page. It’s a straightforward model, but it introduced perverse behavior.

This inevitably failed when advertisers could start choosing channels with better tracking. As ad dollars left, it became less profitable to support these magazines, especially with ultra-low-cost subscription prices. Supporting mass-scale databases became inherently cost-prohibitive.

Here’s a good example… At the AMO Summit, Firecrown CEO Craig Fuller talked about the economics of the newsstand when he bought Flying Magazine. At the time, it cost $1.10 to fulfill every magazine sold despite only generating $0.11 in revenue. How does that make any sense?

Publishers kept their magazines afloat by reducing the quality—making the paper thinner, creating fewer articles, and cutting the number of issues they sent when all else failed. The problem with this is that it is inherently anti-audience. You are delivering a lesser-quality product to your audience. Subscribers start to churn, the profit drops, the product gets worse to keep profits up, and then the cycle worsens.

No wonder it has died.

Yet, several publishers are taking a smart approach to making print work. When executed like this, I believe it becomes a concrete framework for others who may want to make a print product work. In this piece, we’ll look at Flying Magazine, Saveur, and Field & Stream.

The first step is recognizing that the model must prioritize reader revenue. In other words, you’re not selling magazines as a loss leader to make ad dollars; instead, you’re looking to generate revenue from subscriptions. And that means you’ll likely need to charge more money than you’re used to.

• Flying Magazine: $45 per year, which gets you 12 issues. That means it’s generating $3.75 per magazine.
• Saveur: $25 per issue of its twice-a-year magazine. This is a brand-new product.
• Field & Stream: A bi-annual subscription costs $75, and it includes a couple of other member perks.

In all three cases, they’re likely earning a margin on the subscription alone. They can also generate additional revenue from advertising. In February, AMO spoke with Preston Holland, the former COO of Flying Media Group (predecessor to Firecrown).

“We were brutally truthful with our salespeople that the rate base was going to come down,” Holland said, adding that advertisers were also skeptical. But the data suggested that most of those cheaper subscribers weren’t the types of consumers that Flying’s advertisers cared about reaching anyway. 

Going to market with what Holland called a “quality audience” helped open new opportunities on the advertising side, too, he said, even with a lower rate base.

“What our advertisers saw is that their response rates were way up. We’re able to say that we drive value for you as the advertiser because we really care about who our audience is.”

What’s good for the publisher—higher-paying subscribers—is also good for the advertiser. It’s remarkable.

The second step is to take ownership of the subscription end-to-end. In all three cases, you will almost never find the magazine on the newsstands or with magazine agencies. And if you do, it is purely for marketing purposes.

• When Fuller bought Flying, he wrote a blog post about it, and he said, “In order to get the print version of Flying, you must become a subscriber.”
• Saveur said: “We’re also simplifying our supply chain dramatically, pivoting to focus primarily on direct-to-reader sales through our website. Retail through brick-and-mortar stores will be selective; you probably won’t find the new SAVEUR at the supermarket or pharmacy…”
• Field & Stream: “The new one will not be available for sale on newsstand. The only way to purchase it is through a membership in our 1871 Club.”

If you want the product, you’ve got to visit their sites and sign up. This benefits the publisher because they get to keep all of the revenue and all of the data about the subscriber. Why anyone would want to give up that data boggles my mind, but so many magazines still rely on agencies to handle their subscription sales. This is critical information so you can introduce down-funnel monetization, which I’ll cover in future pieces.

Third, you’ve got to increase the quality of the product. In all three cases, the creators of these magazines increased the price. But rather than just keeping that money, they created a product people would want to pay for. There is a direct correlation between price and quality.

• Flying Magazine: “The magazine uses the highest quality paper on the market, along with ink that has far more color depth than anything I’ve ever seen. It now has a weight that gives the magazine an essence of significance and a level of sophistication that is coffee-table friendly for even the most refined taste.”
• Saveur: “In short, this means the print issues will cost a little more than they used to, but I guarantee it will be worth it. We’ll publish only two issues next year, and both will receive the care and effort that previously went into a half-dozen slimmer issues. There will be limited print runs, reducing waste … we’re committed to offering you an affordable luxury: a premium print magazine that is more sustainable than ever.”
• Field & Stream: “If the other editors and I do our jobs, it’ll be better than ever. Bigger than ever, too. The roots of this magazine featured print editions in an oversized format. We’ll follow their lead: The new F&S magazine will measure a whopping 11×14 inches. Inside, each issue of the bi-annual magazine (delivered in the spring and fall) will have 120-plus pages packed with all the great storytelling…”

In all three cases, it’s all about quality. If you subscribe, they promise an unbelievable product. This is a critical part of the business because you can’t expect people to pay a lot of money for a bad product. Paper is a luxury. Therefore, if you’re going to print, make sure it’s the absolute best it can possibly be.

While the same is true for digital subscriptions—charge more than you think, own the subscription, and deliver a great product—it is absolutely essential for print since the costs are more significant.

The model has changed. It’s no longer about achieving mass scale just to generate more ad revenue. Instead, it’s about driving the right subscribers and then further monetizing them in other ways. If you do this part right, you can make magazines a successful business.

Thanks so much for reading. If you have thoughts, hit reply or join the AMO Slack to discuss further.