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Magazine Publishers Hate Me

 How To Buy Magazine Ad Space at a Discount.  And Remnant Space.
Tough Negotiations – an Insider’s “How-To!”

By Jeffrey Dobkin

You can get a hugh discount on the cost of your magazine ad space.  You just have to know how to ask.

Here’s how to handle those tough ad space negotiations. And several ways to get an advertising discount.

A great, intense 12 minute read.  How to get discounts on your advertising space: the inside secrets to remnant space and how to successfully negotiate discounts with publishers.  This is a short but tough “How-To” course on placing magazine and newspaper advertising, placing remnant space advertising and the specifics of how to get the most newspaper and magazine exposure for the least cost.

Article summary:
How To Buy Ad Space at Discount!  Learn the secrets of how to get huge discounts when placing ads – sometimes as much as 70%, 80% even 90% off of your advertising rates when placing advertisements in magazines and newspapers.  This is one of two explicit no bullshit articles that show you exactly how to buy ad space at a discount.
Back to Article Summaries.

First a question: How do you think magazine publishers come up with their ad space rates?
Answer: They make them up.

The more profitable magazine publishers go out for a nice dinner, smoke the good stuff we don’t seem to get around here, drink single malt Scotch whisky and then make up the exorbitant prices of what they think people will pay.

That’s right – they make them up.

The cheaper magazine publishers who aren’t too profitable meet in their basement offices and figure out the cost of paper, typesetting, and layout; getting writers as cheap as they can, then they have a juice and smoke session with shitty weed like I get and cheap tequila which I love and talk about their circulation, what a reasonable price for ad space is, and what the traffic will bear. Then they make the prices up as well.  How else did you think they do it?  There’s no magic formula.

As far as I can tell, most prices for magazine advertising space are based loosely on what’s reasonable for their audience (target market), circulation, what similar magazine publishers charge.

Accommodations are then factored in for charging what the client will bear. Hey, if you publish a magazine in the medical field, I’m pretty sure the pharmaceutical companies – you know: the one’s who have ALL the money – don’t bitch too much about the cost of your ads.  No sense charging less – the publishers lose profits and leave money on the table.  No sense charging more – no one buys.  So the magazine publishers face a constant high-wire dancing act to get as much as they can without leaving any pages blank.

But you say you never see blank pages.

Oh, yes – white holes in the magazine or newspaper with nothing on the page.  It happens more than you think.  The publishers face blank pages.  Blank half-pages.  Sixth-page white holes.

Their solution?  House ads.  Why do you think you see so many house ads – ads for the United Way, the American Heart Association, the and so on?  Free Ads for the nonprofits.  Filler for the publisher.  Filllller.

If you talk to the publishers, they’ll tell you they plug in a price formula for the cost of ad space.

Sure, the plug in any of the two or three of dozen formulas available to them for ad space price per page.  This gives them a range of between, oh, zero dollars per page and $80,000 per page.  Nice spread, huh?  With so many media ad space pricing formulas they can choose from, they choose the one that creates the price that they want: what the client will bear, of course loosely based on their circulation and their audience.  You know, the price they made up in the first place.

Advertising costs based on readership.

All magazines have a CPM, or “Cost Per Thousand,” which means the cost to the advertiser to reach one thousand readers with a single black and white page.  This figure is published in some reference directories, and it has more meaning for the larger, less specialized consumer magazines.  The big advertisers like General Motors and Tropicana use this figure to measure their reach in different markets. So if Ford or General Mills wanted to reach 40 million consumer impressions, they’d use these CPM figures which they can readily find.

But to us direct marketing mortals with limited budgets, these figures are much less important.  Advertising to precisely the correct audience is more important.  Accuracy over breadth.  I’d rather reach 100 people who will buy my clients products than 1,000 who won’t.

Enough chatter. Here’s how to negotiate. 

First, get the publication’s rate card by calling and asking for a media kit and a few recent copies.  The media kit is the publishers printed sales material.  They’re free.  Don’t let them blow you off to their website, make sure you get real sample copies of their magazine and a real rate card in print.

“I actually need to see a few real copies of your magazine to analyze it for potential advertising purposes.  I just can’t get a real feel for it from a website or on the computer…”

If it’s a business or specific-market publication, ask if they publish a directory or annual reference issue, and get that, too.  Some magazines charge a pretty penny for their directory issue, but they always send one to potential advertisers at no charge – if – you ask for one when you ask for a media kit.  Nice tip, don’t you think?  I know you had other stuff to do, but aren’t you happy you read this article now?  Good.  Send me $25.  Just kidding!  Make it $50.  Stick around though – it gets better…

When you get the media kit, note the agency discount for advertisers.  As an advertiser who sends in camera-ready art, you already get a 15% agency commission by mentioning you have an in-house ad agency.  (This discount is actually 17.65%, but that’s another article.)

No question about this discount – everyone but the novices gets this discount.  Don’t let the magazine advertising rep offer you this and claim he’s a nice guy.  If he tries offering this as his final discount, tell him to get serious.

Now you’re ready to negotiate for better ad rates.

Note that there are several advertising ad placement cost columns on the rate sheet.  Note the longer you run your ad, the cheaper it to run advertising.  3x rate, 6 times rate, 12x rate – they’re all there…

This should tell you that most publishers will deal.  [Exception: some of the bigger magazines – the really big ones – may not deal.  They don’t have to.  They’re fat cats with plenty of money.]  But, some publishers will deal, and it never hurts to ask.

With small and medium-size publishers, before placing your confirmed insertion order for ad space: ask for the 12-time ad insertion rate.  Heck, it never hurts to ask, and this is a good opening position.

If no dice, fall back to the six-time rate.  Take my word for it, most publishers don’t want you – and your money – to get away.  If you start out at the 6-time rate, your fallback position crumbles fast to my last choice: the lesser position of the 3-time rate.  So start out high.

OK, if you have to, reluctantly give in to the 3-time rate, and mention that this is the very least they should do for you, or you think you can get “a nice price and a good ad position” with their competitor, which you’ve been considering.  Note this is key verbiage: I mentioned position of where your ad will be placed.  This is coming up fast and I’ll talk about it in a minute.

Still nothing doing?  Hrumph.  Thank them and hang up.  Call back later. Let them sweat it out.

We’ll now create our own modified rate card. 

Ask for the test rate.  If you’re a first-time advertiser to this industry or publication, this makes sense to both parties. If your test ad pays off, you’ll place more advertising – so it’s a win-win situation.  This is actually a reasonable request.

No ad space discount yet?  Insist on the mail order rate.  Some publishers even have a special mail order rate printed on their rate card, and it’s usually a 25% discount.  You do sell by mail, don’t you?

Tell the magazine publisher that while institutional advertising is nice for big companies and getting your name out there, as a direct marketing company your ads have to bring in enough cash to make the ad pay for itself, the product you’re selling, fulfillment of the product to the customer, and some profit.  This is true, and in a reality check for a small firm, nothing else makes sense.  If your ad loses money, you won’t be back with more ads.  If your ad is profitable, you’ll continue to run advertising space.  Let the publisher know this.  It’s realistic.  And you are willing to test the waters if they’ll contribute by discounting the initial ad costs.  It’s reasonable.

In truth, some magazine publishers won’t budge on a media discount, but that doesn’t mean they won’t negotiate.

If your magazine ad salesperson won’t budge on an ad space discount (even after he or she has been into the publisher’s office several times on your behalf) and you’re still determined to place an ad, go for an upgrade in ad size.  Express it this way: “Gee,” I always say Gee – ’cause it makes me sound kinda backward and sooo innocent – “I’d like to place that ad, but 1/4 page is just not big enough to be effective for a direct marketing product like ours.  If I could get a slightly larger space – like 1/3 page for the same cost….”

Lots of magazines that won’t give you a cash discount will free-up additional space for a larger ad at a smaller ad charge.

If they’re still holding out, thank them kindly, let them know you’d be interested in that as a deal, and hang up.

Let them sweat it out while you have a beer and go out for a nice dinner.  Leave your number and see if they call you back.

Last and least:  Almost all magazines will give you a second color free with any decent-sized ad.

Once in a while a publisher can be tough on this, but most, like 90% of them, give in without too much being said. When I have a client who asks me to contract for 1/3 page, I always express my request for a second color like this: “My client wants a quarter page, but I think I can get him to move up to a third of a page if you’ll lay in a second color at no charge.”  This can also be followed by, “We need to be in the first twenty pages, too – or I know he’ll cancel.”  This statement works for increasing ad size AND getting good ad position in the magazine, too.

Let’s talk about positioning.  Where your ad appears in the magazine is ALWAYS negotiated.

Ask for ad placement in the FRONT of the magazine or MAIN NEWS section of the paper.  Don’t take “I don’t know where they’ll place you,” for an answer from your sales rep when it comes to where your ad is positioned in the magazine.  The advertising salesperson absolutely does have a say in where your ad runs.

Don’t take “I guarantee you good position” for an answer, either. Reason: it’s undefined.  Once the magazine comes out and your ad is on page 80, and your salesperson says “Hey, I got you into the first half of the book – pretty good, huh?” it’s too late to get a refund, or even a free reprint.

The best you can do at this point, if you complain loudly enough, is that the magazine will usually reluctantly run another ad at half price.  This costs you more money and is not much consolation if your first ad didn’t draw flies let alone orders, much less customers.

Let them know UP FRONT that your idea of good position – in the front of the book, first 20 pages, upper right-hand page (expressed as Far Forward Right Hand or FFRH) – may be different from your salesperson’s definition of good position.  You may be thinking first 20 pages, he may be thinking page 60.  Better to specify exactly what good position means to you up front.  Be explicit or you’re at risk.

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Warning:  The 3-Ad Myth

The publishers reply to your negotiation for a discount will probably be:  Your space rep will tell you if you run your ad three times you’ll get the three-time rate, which all magazines seem to offer prominently.

In truth, some magazines won’t budge off their published rates and actually just stick to their rate card.  You may just have to buy 3 insertions to get a better rate.  If you want the discount and actually need to purchase space for more than one insertion to get a better rate, do it.  Consider it an interest-free loan.

However: If you’re placing an ad in an untested magazine, absolutely do not purchase space in three consecutive months Reason: if the first insertion fails miserably, it’ll be too late to cancel the other ads.

I also don’t care for the crap about “how an ad has to be seen three times for maximum draw.”  It’s bullshit.  If it fails to draw a decent response by a wide margin the first placement, it’s not going to suddenly be profitable with the next two exposures, either.  Period.  And I’ll guaran-damn-tee you that.   For the real explanation of this, see the full article “The Three Ad Myth,” found on this website.

You need to see the response to the first ad before committing another nickel.

I also don’t care what special issues are coming up (barring overpowering seasonal necessities).  Like street cars, if you don’t catch this one, bingo – another comes along.

Remedy: If you have to schedule three ads, schedule the first as planned, then schedule the next ad three or four months after the first one appears.  This way you’ll have time to see what draw your ad has – or doesn’t have.  If the ad fails, you’ll have time to cancel the next ads.  Cancel in writing.

If you have any doubts about the publication’s reputation, send the cancellation notice certified, so there won’t be any question that they received it.  If you cancel the rest of your ad schedule, you’ll get the “short” rate – which means you’ll have to pay the difference between the one-time rate and the three-time rate for the single ad you ran.  This is a legitimate bill, and you’ll have to pay it.  Sorry, too late to negotiate this out.  Fair is fair.  But it will be far cheaper than paying for two more ads that don’t draw.

Remnant Space

Good news!  I’ve saved the best for last.  You can sometimes get ad space for 50% and 60% maybe 70% off. Sometimes you can get discounts on placing your ad at 80% or 90% off the rate card.  Occasionally even more of a discount depending on the publisher and the closing and on-press dates.  I’ve purchase ad space at 95% off rate card on more than several occasions.  Way more…

Yes, you read that right: 90% off.  It’s called remnant space, or stand-by space.  Almost all magazines have it available sometimes.

Some publications have remnant space most of the time.  Most newspapers have it available all the time.  Yes.  They just don’t tell you about it.

With magazines, I’ve had publishers say they never sell advertising space at remnant rates… until I get a call late in the month, they were on deadline, and have an open page and need an ad for it right away.  It happens more than you think.  And from some pretty large publishers.

Some publications who offer remnant space on a regular basis will only deal with discount ad brokers – and it’s a scary world out there dealing with some of these firms.  The industry is like the wild west, so some caution is in order, and strong guidance is suggested.  Give me a call and I may be able to give you a point in the right direction.  It’s a terrible industry – like dealing with invention marketing companies.  A lot of scammy people, and bad firms out there.

Here’s how Remnant Adverting Space works:  

Remember the blank white page I addressed earlier?  A page is white when an advertiser pulls out its ad at the last second.  It happens all the time.  Arguments.  Bankruptcy.  Non-payment.  Whatever.  The magazine publisher is now faced with a blank page or part of page, and is on deadline… and going to press in 1 or 2 days.

Running a free ad for the heart association or other favored charity is their worst option – it doesn’t pay.  No revenue.  So your offer of almost anything may sound pretty heckin’ good at this time.

If you find a magazine or newspaper you like, call the publisher and ask if they ever have “remnant space” available.  They’ll say no.  Anyhow, tell them you have a full-page ad, a half-page ad, and a third-page ad ready to go if they ever have a last-second cancellation.

There are no guarantees you’ll be in any particular issue, if any at all.  However, one day you may get a call…. And it may be sooner than later.

If they call, keep in mind the discount they just offered you on the phone is their advertising remnant space starting figure for negotiating.

At this point in time they have their back to the wall, and the thought of going to press with a house ad (for no revenue) is depressing.  Any reasonable offer you make should be entertained.  Don’t be bashful.  A lowball offer you make can always come up in price and offer.  A high offer is foolishly final for you.

The downside of Remnant Space:  You take your chances with buying remnant space because it may never run.  If the magazine or newspaper publisher gets a better offer, a last minute advertiser, or hot editorial to fill the void your remnant space may be negated.  There’s a slim chance of this but you need to be aware of it.  Since it’s late in the publishing cycle chances are your ad will run.

If your advertisement runs, it’s a chance to have a full- or half-page ad at incredible savings.

Third-page ads don’t have as many remnant space opportunities in magazines.  Magazine publishers always have current regular advertisers whom they can plug in with a 1/3 page ad if they give them a discount. When they do this, they look like heroes to their regular advertisers.  The downside is now the advertiser will want that discount all the time.  So these third page ad sizes do come up on a regular basis.

Negotiating Ad Space Position

Here’s the other half of running discount ads and especially remnant space advertising.  The biggest drawback to purchasing remnant space is that your position in the magazine or newspaper will always be lousy – towards the back of the magazine or paper.  And no, not that many people really start reading the magazine from the back, regardless of what the sales rep tells you.

Poor placement of your ad bought at remnant space discount pricing is most always guaranteed unless…

Unless you negotiate good positioning when they call you.

Reason: if the free space opens up in the front of the publication they’ll move an ad from a full-paying regular advertiser up to the front.  This way they’ll look like a hero to their full-price advertiser.

So – lesson to be learned here:  Always, always negotiate good placement of your remnant space ad before committing to saying yes, and contracting for the ad space.  Once you commit to run your ad, any ad, you lose all your bargaining power.  All.  So you have to negotiate everything up front before you say yes to placing an ad.  An important lesson here.  Worth another $25?  You tell me!

Full-price advertiser?  Yes, some magazine won’t budge on ad space discounts. But sometimes…  discounts of 80% and 90% off the rate card are looking pretty good.  OK, how do you feel about reading this article now?  Worth it?  Please let me know.

Geez.  All my magazine publisher friends are gonna hate me now…  Hey, fellas…

Additional reading: How to Negotiate Discount Ad Rates

Jeffrey Dobkin

Jeffrey Dobkin

Hope you have benefited greatly from Jeffrey’s years of experience in placing advertising space.  This is just the tip of his knowledge – call for additional information.

Jeffrey Dobkin is a tough, shrewd negotiator who regularly negotiates advertising rates for his clients.  He has managed several national remnant print campaigns for his larger clients and has placed millions of dollars in advertising space.  Call for information: 610-642-1000 rings on his desk.