Strategic Alliances In Publishing:
Case Study of Readymade Magazine
September 23, 2010
Reinsch, Russell C.
ReadyMade maintains many strategic alliances that are beneficial partnerships for the magazine. The bi-monthly magazine has a small circulation and a target audience profile of Generation Ys who are interested in Do It Yourself activities. ReadyMade, an independently owned periodical founded in 2001, was sold to Meredith Corporation, publisher of many periodicals including Better Homes and Gardens and Parents magazine, in 2006. Unlike most print publications that have suffered from the double whammy of declining ad revenues and subscriptions in the social media/online publishing boom, their ad revenues grew from 2007 through 2009 and circulation rates were holding steady. This is a markedly better scenario than other, better known, publications are facing.
As with all periodicals that are sold at book stores, newsstands, chains and other retail venues, Ready Made uses a large distributor to handle all the relationships with the outlets that sell their print publication. ReadyMade has one large standing order with the distributor and the distributor is then responsible for marketing the shelf space for ReadyMade. This simplifies and streamlines the supply chain, distribution channels and other management issues between ReadyMade and the outlets that display and sell their magazine. The distributor, in return for an agreed upon commission (a percent of the newsstand sale price) is responsible for placing the magazine in the different venues and negotiates the number of issues purchased with the retailers. These issues include the specific display and position of the publication, special retail promotions related to the publication, the number of copies ordered (referred to as draw), etc.
There are many elements involved in selling print magazines and the distributor for ReadyMade handles the retail outlets only. Another method for selling magazines is by subscription where a person pays up front to receive his publication either through the mail or through an electronic version. Many Daily newspapers and magazines have set up digital/online editions and subscriptions. Examples include the Wall Street Journal and the Smithsonian magazine. Library subscriptions can be handled either by the retail distributor or by developing another strategic alliance with a distributor who specializes in the library market.
ReadyMade has developed a market strategy that appeals to their target audience. Among a plethora of social media marketing options, there is a blog, Facebook and Twitter accounts, RSS feeds, and a free ReadyMade account that will guarantee to deliver two different newsletters and special offers straight to the account holder’s email account. As with most publications, the majority of the revenue is garnered through advertising. And, following industry standards, advertising rates are dependent upon circulation numbers. Circulation numbers include all sales from retail outlets, both internet and bricks-and-mortar based.
Strategic alliances are an important part of keeping ReadyMade financially viable. With a distributor handling their distribution channels, ReadyMade can focus on the editorial side of their business while the distributor focuses on the marketing aspects of selling the print magazines.