Today I have carried out some research on how magazines make money.
Every month magazines produce information dedicated to a particular topic. There are a vast variety of magazines including sports, fashion, beauty, music and gardening. Magazines are a business and they must generate income and stay profitable. There are three main ways that magazines make money these are circulation and subscription, classified advertising and print advertising.
Circulation and Subscriptions'
When somebody buys a magazine from a newsstand, the profit made from that sale makes money for the magazine. This type of sale is called a single copy sale, however the money made from this sale is very little profit when including how much it costs to make the magazine, the cost of transporting it to the newsstand and the commission the magazine company must pay the newsstand company for providing the space to sell it's magazine.
However magazines do make a larger profit from subscriptions. The profit earned is far greater than a single copy sale as the magazine is transported directly to the consumer. Magazine companies have the address of the consumer, so they can make a pitch to renew the subscription when it is due, magazine companies can also pitch any other magazines that they produce that they think would be of interest to the consumer.
Classified Advertising
In every magazines there is more than likely to be a classified section which display's want ads. A want ad is a classified advertisement in a magazines or a newspaper. Magazines sell want ads by the word or line, the ad's can be quite expensive in popular well known magazines which have a large circulation. But however moderate magazines with a smaller circulation can command large prices to display the want ad's, if they target a specific area or a group of people. This is also another source of income for the magazine companies.
Other Advertising
Magazines can make money by allowing advertisers to use its unused space throughout the magazine, this includes the covers and inside the front and back cover. It is very common for the full page back cover of a magazine ad to run several thousand pounds or more popular in magazines with national coverage. Not only does the magazine make money with this form of advertisement, it also helps o fill up the pages by placing ad's in any unused space on pages around the story line, this way the magazine looks better and it's income increases.
