How Important Is Price in Media Buying?

As we are getting closer to the Holidays, most of us in media find ourselves looking into crystal balls to come up with forecasts, and are in the middle of making marketing and advertising plans for the upcoming year. This means setting plans and goals on what we think we can accomplish, allocating budgets, and mulling over our options.

For publishers, this is the time of year when their magazines are scrutinized by media buyers for circulation, frequency, advertisers in competitive sets, percentage of duplication, editorial content, reader demographics, one-year/two-year/three year qualification, ad/edit ratios, positioning, and pricing. At least these were some of the criteria used for evaluating and selecting a magazine in the past.

Now it may be just me, but it seems that more and more, media buyers are fixating on pricing—and only pricing. Or pricing is the most important facet of the planning process. Pricing is an important facet when considering a media plan, don’t get me wrong. You have a budget. Whether it is relatively big or small, you are looking for efficiencies. But the other criteria listed above that go into making a publication is equally as important.

I learned that one of the magazines in our industry made a move in 2013 to reduce its printed issue frequency from a weekly to a monthly, with a second issue to be sent out digitally each month. I was a bit stunned by this news, if I am honest. This is a fairly big move, and from a magazine that does a better job than some of the other print magazines covering the property and casualty insurance industry, in my opinion.

I can’t stop wondering what the motivation was for this change. Are readers changing their habits on how they gather news and information? Sure, that may be some of it. We’ve seen the digital age pinch the printed magazine. Could it be the economic doldrums in which we find ourselves? Maybe, but like food, we need insurance. The economy doesn’t move without insurance. The P&C insurance industry is still moving forward. Or is it a reaction to the constant drumbeat for bargain basement pricing for print?

My concern is that media buyers who continue the quest for the cheapest buy they can get (and minimize or disregard the other functions that a magazine has to offer) are slowly squeezing media sources out of existence. Some of our own recent readership data shows that about half of the Insurance Journal print readers get their news only from print. Yes, they tend to be at the “mature” end of the demographic bell curve, but these are usually the principals of the agency or brokerage house. Print still has a place in this world.

Now, I am a free market economist at heart, and this trend, if real, will only help Insurance Journal’s digital media position, but there are still a lot of our consumers that gather news and information by print and we will find an efficient way to continue to serve them as well.

My hope is that the marketing community doesn’t squeeze print to death because of the rise in popularity of digital media, if indeed pricing and print revenue is the cause for a publisher to reduce their print frequency by seventy-five percent.

Happy Holidays!