From Insight Advertising, Marketing & Communications a full service advertising agency based in the "Middle of the Midwest" our Business Blog:
Imagine your slick full color ad on the magazine page to your left. Got it?
Now, let's figure out what that magazine ad really cost you when we look at pure circulation numbers. (We'll cover the difference between circulation and readership in another piece.)
OK so you've hired us to create for you a great looking ad that we all agree will get your message across to the intended audience. In the MEDIA PLAN...that you should have and that we helped you create...we've recommended a run in this magazine. The cost for that ad comes to $8,500 per insertion. You know all of this because it's in the media plan.
Now, along comes another media sales person selling advertising space in their magazine and quotes you a price of $4,500 per insertion. (A shameless opportunity for us to insert a photo of Kate Walsh.)
We get the phone call:
"WHAT? Why did you buy that high priced ad and not the less expensive ad? I could have run twice for the price of one!"
We now drag out the highly accurate computing device and do the math: The $8,500 ad is going in a magazine with a circulation of 550,000. We divide the cost of the ad by 550 and come up with a CPM of $15.45. In other words the cost to reach 1,000 people was $15.45.
The $4,500 ad is in a specialty magazine with a circulation of 40,000 people. Divide the cost by 40 and we see the CPM of this ad is $112.50. That's right $112.50 to reach 1,000 people.
Now, are there times when our client should pay the higher CPM? Yes if that magazine is the specific target market. It all depends on what product or service we're attempting to market using print.
The bottom line...what seems cheaper may not be. That's another reason we strongly suggest to our clients and our friends to do a media plan...then there are no surprises and everybody is on the same page. (Of that $8,500 a page magazine...)
Michael Libbie - Insight Advertising, Marketing & Communications - Thanks for reading.