Sunday, April 16, 2006

Starting a New Magazine or Newspaper

Starting A Magazine or Newspaper
SPECIAL REPORT
Copyright (c) William Dunkerley

Getting from the Dream to the Reality
-- Without Losing Your Shirt
By William Dunkerley
Publishing Consultant

They say lots of people are walking around with
the great American novel in their heads.

But what about the idea for a new magazine, e-zine,
newspaper, or newsletter?

Have you ever had a notion for a great new
publication? I'll bet you have. Perhaps you've even
felt tantalized by the thought. Just dreaming about
the kind of publication you'd produce if you only had
the time, money, independence, etc., etc. can
provide terrific vicarious enjoyment.

But let's get serious for a moment. Maybe
you're really on to something with your idea for a
publication. Perhaps you should earnestly be thinking
about putting your ideas into an action plan. But
the process for launching a start-up may be as clear
to you as the know-how for sending the first person
to another solar system!

Indeed, what are the secrets of starting a new
publication? Who starts them? How do you plan for a
start-up? And how do you execute your plan?

The Publication Starters

Who starts new publications, anyway? Of the
publications launched overall, 60 percent are started
by newcomers to publishing. Twenty percent of those
are by non-profit organizations. It's not surprising
that so many new publications are launched by
publishing neophytes. Publishing is a relatively
easy industry to enter. It is also an activity seen
by many as a means for advancing a cause or an
interest. For example, an individual highly
interested in environmental protection might seek to
start a publication in that field.

But for many of the start-ups, success can be
elusive. Interestingly, of those publications which
fail, 50 percent are started by newcomers, 50
percent by experienced publishers.

What, then, is the reason that some succeed
and some fail? Of course there can be many reasons.
Undercapitalization, insufficient demand, poor
management, wrong strategies are among them. These
are some of the pitfalls of the publication start-up
game.

The Secrets of Success

In my experience, there are two start-up perils
which are particularly insidious. They are (1) the
lack of a realistic plan, and (2) an insufficient
demand for the new publication.

In planning, striking a balance is important.
Somewhere between a slapdash effort and one that's
confounded by excessive concern for detail is a
happy medium: a good workable plan. Just as you
wouldn't want to go off half-cocked to start a new
publication, you'd never get one off the ground if you
got caught up in "analysis paralysis." Wasn't it
Alfred E. Newman who said, "What, me worry?" Perhaps
a touch of that wisdom can be helpful.

Your plan should be practical, methodical and
realistic. But you should not lose sight of the big
picture due to inordinate attention to small
details. Of great importance is committing the plan
to paper. This will allow you to go back at various
steps along the way to look at your original
assumptions and expectations. You may revise your
plan, change directions, or even scuttle the
endeavor. But your performance and decisions will be
greatly aided by having a good written plan.

A Crying Need -- Or a Need for Crying

Then there's the matter of whether there is a
need for the publication. Be very cautious about
this. Particularly if the subject area in which you
are to publish is dear to you. Many a new publisher
has confused his or her own perception of "need"
(based on a personal interest) for an actual market
demand. The mix-up can cause a disaster.

Check out the need as best you can. Try focus
groups, personal interviews, conversations with
leaders in the field, with prospective advertisers.
They can all provide help in reality-testing your
perception of need.

However, don't expect the advice you get from
these sources to be unbiased or 100% accurate. The
real test will come when you bring your publication
to market. There's no sure substitute for actually
selling subscriptions or selling ad space as a means
for determining whether your concept is viable!

The Practical Steps

Here's how to get started.

1. Develop a concept. Flesh out your ideas of
what the publication is all about. What kind of
articles will it include? What is the editorial
position? Will you sell subscriptions? Is
advertising to be included?

2. Develop a start-up business plan. Outline
the market, take a look at all the expense and
revenue. Plot your cash flow. Analyze profitability.
Figure out how you'll produce and finance the
venture.

3. Produce the marketing materials. Consider
all the possible audiences to whom you'll be
marketing: readers, advertisers, financial sources.
Each will need a different, targeted marketing
piece. A direct-mail package for the readers, a
media kit for the advertisers, and a
prospectus/business plan for the financial people.

4. Start the hard work.

The Start-up Business Plan

Two publishers I heard of recently put together
business plans. The first had one objective in mind.
He needed a document to present his bank as part of
negotiations for financing. And so the plan was
written with an exclusive emphasis on impressing the
bank. The other publisher wasn't seeking financing.
Her reason for constructing the plan was to optimize
marketing efforts. The approach she used to develop
the plan was to go out and get a ready-made computer
spread-sheet program.

Both of these well-intentioned entrepreneurs
missed a major point, however. A start-up business
plan is not just a spreadsheet. It also is not just
a boastful, exaggerated write-up intended to impress
your bank or financial backer.

Rather, your business plan must be a well
thought-out blueprint of how you are going to start
and operate your new publication. It provides a time
for you to test assumptions, uncover pitfalls and to
develop strategies that can guide you toward
success.

There are seven essential elements that should
be included in every plan. They are, (1) market
description, (2) competition survey, (3) product
concept, (4) organization, (5) marketing strategies,
(6) production plan, and (7) financial plan.
Following is a description of each element.

Market Description

Who will be the readers? Define the industry,
profession, etc. Who are the component groups? How
many are in each group? What are their interests?
Are the prospective readers accessible, are lists
available? Or how will you develop your own list?
What is your total circulation potential?
Conventional wisdom is that you can achieve a
subscriber level of about 10 percent of those in a
given market.

Who will be the advertisers? Who are they
specifically? Is a list available? Whom are the
advertisers trying to reach with their marketing
messages? How much money are they spending on ads
aimed at the field in which you will be publishing?

What About Competition?

Identify other publications serving the field
exclusively. Also check those which cover the field
in part. Who owns them? What are their frequency and
circulation? What are their rates?

Are they profitable? Estimate their revenues
and expenses to answer that question. For
subscription revenue, multiply their claimed
circulation figure by the subscription rate. (If
they're mailed as "Periodicals Mail," you might want
to get a copy of their Form 3541 Statement of Mailing
from the Postal Service as verification.)

To estimate ad revenue, count up ad pages in
their book. Exclude house ads, donated ads, etc.
Then multiply the total by their rate card figures.
However, in these days of selling off-card, it might
be wise to probe the issue of whether they are
selling discounted ads. Finally, estimate their
expenses based on your knowledge of what things
cost. This procedure should lead you to a fairly
good idea of your competition's profitability.

Product Concept

Compared to the competition, will your
editorial product be noticeably different or better?

Consider the publication's appearance. Its
frequency? Ad/editorial ratio? Means of
distribution? What will it cover editorially? Give a
detailed list of the kinds of articles, features and
columns. An annotated table of contents planned for
the first issue offers a good way of describing
content.

Organization

How much staff will be needed? Who will do
what? Who will work for whom? Should you hire new
people or use existing staff? What type of person
will best fit into your start-up plan: are you
looking for someone with an entrepreneurial zeal or
with the steady hand of a seasoned line manager?
Will start-up team members' styles be complementary
or in conflict?

Marketing Strategies

"That's how you can tell what's good in
America. It costs a lot." --Archie Bunker

How will you price subscriptions to your new
publication? Will you undercut the competition? Or
price your publication higher to bolster its perceived
value? Will you offer introductory rates or
subscription bonuses?

Consider whether distribution will be free or
by subscription. Profitability from subscription
revenue usually takes around three years. Can you
meet your objectives better by distributing the
publication free to a selected audience which
advertisers will value?

Contemplate the timing of the first issue. Will
you be coming out at a time that's favorable for
selling ads and subscriptions? Don't try to sell
against seasonal trends in your field. To do so can
be like selling Christmas trees in July!

Are you going to buy mailing lists for
promotion -- or will you compile your own?

In terms of advertising, it is important that
the first issue look healthy, with lots of ads.
Nothing will build advertiser confidence more than
that. How will you handle sales? Will you use
commissioned reps? Or use an in-house staff? How
much of your sales efforts should be made out in the
field vs. by telephone selling? Which method is best
suited to the geographical distribution of the
advertisers and their customary business practices?

Production Plan

How will you handle typesetting, layout,
printing and binding, mailing and other forms of
distribution? How will the schedule for the new
publication mesh with your (and your staff's)
existing responsibilities? What vendors will you be
working with?

Financial Plan

Start with projections. Base them on the
decisions you've made with regard to the previous
elements of this plan. Produce spread sheets. Do
what-if analyses. Look at cash flow and p/l.
Determine the maximum need for capital and when it
occurs. Where will it come from? What will it cost?
Be sure your accounting system will give quick,
reliable feedback once operations commence. Such
information will be vital in fine-tuning your plan
and keeping your venture on track.

What About Check Points?

How far do you want to stick your neck out
before risking its being cut off? That brings us to
the matter of building in go/no-go check points (the
first of which should have been before you even
started writing the plan -- in the development of
the concept). Set specific objectives in advance.
For example, you may require a 3 percent response to
a test marketing of subscriptions before going to
the next step. You may require x pages of
advertising sold before committing to printing and
distributing the first issue.

Set your go/no-go check points so that you will
receive early warnings of impending problems. If
you've constructed a good plan, and the check points
are saying "all systems go," you'll be will on the
road to success. But heed the warning if the message
in "no go." It will save you from losing your shirt!

----------------------------------------------------

DID THIS ANSWER ALL YOUR QUESTIONS?

If not, you can talk directly with the author now.
Get your burning questions answered to your
satisfaction ... receive feedback on your ideas and
plans ... obtain expert advice.

Go to www.publishinghelp.com/talktoauthor

----------------------------------------------------

WILLIAM DUNKERLEY is a publishing consultant
specializing in starting new publication ventures.
He has been president of a technical publishing
company, publications manager of a national
association, and served as a director of the Society
of National Association Publications. He has written
for Folio and Successful Magazine Publishing and is
the editor of Editors Only, a monthly publication for
editors. Since 1981 he has been engaged in his own
consulting practice, guiding publications to greater
success and profitability.

William Dunkerley, Publishing Consultant
275 Batterson Drive, New Britain, CT 06053

Phone: +1 860-827-8896 Fax: +1 860-224-9094
Email: wd@publishinghelp.com
Web: www.publishinghelp.com/consultant

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