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When it comes to improving the profits of print magazines, there is a tendency to focus on new ways to generate income. But while keeping a close eye on spending can also have a significant impact on bottom lines, today’s environment often demands a balance.
“We know austerity doesn’t work,” says Erin O’Mara, president of The nation. âWe see it in countries and in companies. If the cuts are too deep, they can stifle the ability to thrive. All potential expenses should be weighed against the potential return, even if that return is forthcoming. “
Cutting costs means looking at spending across the board, from the small things like office supplies and prepared breakfasts to the big ones like printing and postage. At Wainscot Media, a bespoke publisher in healthcare and luxury marketing, the company has taken a committee-based cost-cutting approach, bringing together representatives from the sales and marketing departments, editorial, accounting and others to research areas where the organization can reduce expenses.
âIt’s a good approach because then it’s a company-wide effort,â says CEO Mark Dowden. âThen when you put it into practice, it seems less drastic. They don’t come from top to bottom.
The trend towards fewer, higher-quality issues continues, as publishers continue to implement frequency cuts in print magazines, the most recent of which came earlier this month from Meredith Corp., which revealed his intention to reduce Weekly entertainment to a monthly schedule while investing more in its online platforms.
The Society of Human Resource Management had its eye on printing and postage costs when it decided to reduce HR Magazine from 10 annual issues to four. Although the production costs of each issue have increased, as the quarterly issues are larger, the overall costs have decreased. The organization has published two quarterly issues so far, and the change has been a success, said executive vice president Tony Lee.
âWhen you cut production by 60%, you don’t necessarily have a 60% decrease in freelance costs for writers or artists, but we’ve almost got to do it,â says Lee. âAnd we were able to reinvest those dollars in digital initiatives. “
Publishers are finding ways to use automation to make their processes more efficient, whether it’s reaching potential subscribers, processing renewals, or even managing payroll. With the right automation program, these efforts not only reduce costs, but they also free up traffic and marketing staff to work on other things that might require a more human touch.
âSmall operational changes can mean a lot,â says O’Mara. âWe use online banking and pay via ACH, which, while not revolutionary, reduces paper consumption, postage, time and personnel costs. “
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Reorganize or reduce staff
The most painful cost reduction strategy for most publishers, of course, is downsizing. The pace of layoffs in print magazines appears to have slowed somewhat this year (although they continued in newspapers and digital properties), but there were still cuts, notably at Meredith, New York Media and, most recently, Pride Media.
Even magazine companies that don’t layoffs are closely scrutinizing their staff positions to find ways to meet changing demands without increasing their workforce.
âTen, 15 or 20 years ago, there was no need for a social media coordinator or engagement editor, podcast producer or newsletter editor or an online marketing manager, âsays O’Mara. âOur strategy is to ensure that the mandates of staff positions evolve to remain competitive and relevant in the market. This means that the size of the staff is not increasing, but that the staff is deployed where there is a need.
For small publishers, eliminating a single post can have a significant impact. Business Virginia Magazine publisher Bernie Niemeier decided last year, after his account manager left, that he would take on the task himself (with the help of an outside company at tax time).
âI didn’t have a career path for this person, so the job changed every few years, and it cost me money to replace,â says Neimeier. âI just learned Quickbooks and started doing it myself. This position, with fringe benefits, is close to $ 60,000, which represents a great saving for the result.
Cleaning up mailing lists
As advertisers demand more and more data, the quality of a publisher’s list has become more important than its size, in most cases. Building a more targeted list not only makes publishers more attractive to advertisers, it also offers the potential to reduce printing and mailing costs to less valuable and unengaged subscribers.
âA lot of investment has been made on the subscription side to acquire more profitable subscriptions and trade low margin source subscriptions,â Meredith President and CEO Tom Harty said in a earnings call last month.
This may be a more effective method of reducing printing and postage costs than the cutoff frequency, explains Dowden.
âYou still have your problems and you tell your story in the market,â he explains. âCutting off traffic is sort of an invisible thing. You are not cutting the editorial quality or the number of pages. Even when you tell advertisers it doesn’t bother them. You cut out the less important parts of the broadcast and try to do a better job for the primary subscribers.
Negotiate with suppliers
Editors say it’s critical to limit contracts to a few years or less, negotiate frequently, and shop around with other vendors to keep costs from climbing. They shared stories of recent savings on rent, benefits, and technology providers through negotiations.
Niemeier prefers to limit contracts with his printer to three years and start negotiating the new contract at the start of the third year.
âIt gives you time to negotiate and you can even start the new contract earlier,â he says.
Extend the content further
Using the same content in multiple ways also helps publishers reduce costs. Wainscot Media, for example, creates multiple personalized publications for clients in the same industry but from different geographic regions.
âAs long as you pay attention to geography, you can publish the same editorial without any changes or with slight headline customization,â says Dowden. âIt has been a way for us to grow efficiently. You increase productivity without requiring more work from people by syndicating content and posting it to multiple channels.
For more on this topic, attend the âHow to Cut Printing Costs Without Sacrificing Qualityâ session at Folio: Show in October in New York City.