How to calculate the number of ads you'll need?

Latryce Guest Oct 27, 2008 12:43 PM

Hi there! Is there a set formula or way to know how many ads you'll need in your publication? I know you said that ads take up 40-50% of page space, but how do you know how many 1/8, 1/4, 1/2, full pagers to sell at each size? Thanks in advance for your insight.

Magazinestartup 3 posts Nov 24, 2008 10:06 PM

Hi Latryce: Thanks for your inquiry. Well, your question requires a lengthy answer but I will try to be as brief as possible since time doesn’t allow me to expound too greatly. Ok, magazine ad rates are based on a concept known as CPM or Cost Per Thousands. You might be wondering, why the ‘M’ and not a ‘T’? Well, the ‘M’ is in reference to the Roman numeral M which is 1,000. You will also come into contact with this ‘M’ when you receive an offset press printer’s quote for your magazine. You will see somewhere near the bottom: “Addl M’s” or Additional Thousands. This is in regard to the cost for printing an additional thousand magazines over your quoted print run. More about that later on. When you’re creating your ad rates, you want to consider the CPM which is the cost associated with reaching a thousand readers. Now, this is not an exact science but you will find, once you’ve analyzed media kits from possible competition, that the average CPM for many consumer magazines teeters around $100. What does this mean? Let’s say that you have a magazine circulation of 15,000. The open rate, the rate that an advertiser would pay for just one ad placement in one issue of your magazine, for a single page 4 color ad would be $1,500 dollars (100 X 15). Do you follow me? This is just a general example but the CPM can vary greatly between similar magazines based upon the demographic they serve, if it’s a niche market, value added offers, etc. I highly recommend that persons interested in launching a magazine take it upon themselves to get at least 10 different media kits from publications that are similar in scope to their concept. Another factor to take into consideration will be your CPI or Cost Per Issue. The CPI is all the costs that are directly associated with the production of each copy of your magazine. Essentially, it is the net cost for each copy of your magazine; not the cover price! What do I mean? Well, let’s take this general example of some costs associated with producing each issue of a magazine with a print run of 15,000: 1) Graphic Artist: $1,200 2) Stock Photography: $350 3) Freelance Articles: $250 4) Misc. Expenses: $300 5) Offset Printing: $10,000 Total: $12,100 Now, let’s take this number and divide it by the print run: 15,000. When we do this, you will get this number: 80.666. Thus, the CPI is 80.6 cents. So, the net per copy is just under 81 cents. This, of course, is just a rough sketch, if you will, but the CPI will be instrumental in not only determining your ad rates but also your cover price and is an obligatory component of your business plan!! I can’t stress the latter enough since it simply amazes me how many magazine publishers launch their magazines without doing one! Ok Latryce, I hope this provides a little more insight. Sorry for the delay but I wish you much luck with your endeavor! Shawn Last Edited on 24-Nov-2008 10:10 PM

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