Revenue in Print Media

Topics: Printing, Newspaper, Advertising Pages: 5 (1639 words) Published: March 1, 2011
Print production is measured on its quality, timeliness and effectiveness, whether it's a brochure or packaging or a magazine advertisement. But when something in the production process goes wrong, it can not only cause delays but also increase cost and impact quality. The challenge for print buyers is to manage print jobs efficiently through procurement and production while guaranteeing consistent quality and on-time in-budget completion. This requires specialized expertise. Digital technology is increasingly competing with print media by opening access to endless sources of news. It may now seem that the need of the reader to buy a newspaper for news and the need of the advertiser to advertise in it, is slowly receding. Thus it is for the newspapers to look at emerging options and to rework their traditional sources of revenue. Advertising and Circulation Revenue

There are two basic sources of revenue for the newspapers:
The circulation revenue recovers only a part of the cost of producing a newspaper. The onus of making a profit after all costs, is on the advertising revenue. If circulation falls, advertisers shy away from using the medium. On the other hand an increase in circulation to take reflect on ad revenue takes time. Newsprint account for about 70% of the cost of production, but any increase in circulation does not decrease per unit cost. Also any marginal increase in advertisement revenue due to increase in circulation is not apparent in the short run. Unique Success of Local Newspapers

The present economic downturn has hit newspapers very hard. Globally, many are facing closure. But there is a clear divide between big-city newspapers and their relatively healthier brethren in small cities and towns. When big newspapers fight for survival, often small community newspapers thrive. While classified advertisement revenue has taken a hit for big-city papers from competition from free or cheap on-line listing, many smaller newspapers have retained their appeal to local advertisers who target customers who live and shop nearby. Cost of Increasing Circulation

In the past, newspapers have tried to increase circulation in far flung and scattered areas. By touting circulation figures they hoped to attract advertiser. The cost of generating these numbers have proved to be heavy for the newspaper. On the other hand, over the years, advertisement media buyers and planners have reduced their dependence on absolute readership numbers. Instead they look they look at the qualitative aspects of the targeted readership. No wonder the elusive advertiser is much more inclined to use other less expensive media for the quality and quantity reach instead of depending on traditional media like print. Thus, if inconsequential circulation can be reduced even by a percentage, it would be a great savings for the beleaguered industry. Yes, it also means leaving vacant spots to smaller local players. But then perhaps it is the only way for the market to evolve. Secondly, the revenue earned from the cover price after distributor commission recovers only a small part of the cost of production and distribution. If the cover price can not be tinkered with for fear of losing circulation, then the industry must look at the question of page level. Should a newspaper or for that matter a magazine must have so many number of pages or it will not sell ? In these tough times it would be a folly to assume that advertising revenue, will make up for all the shortfalls. New Strategy for Print Media

Today web is a data retrieval tool for the people who are looking for specific information. They know the basic facts of news as it happened and would be interested to know what would happen tomorrow. They would spend more time on a newspaper, if the content is more compelling. It is the transient nature of the message on electronic media that drives audience to look for corroboration and...
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