Feed on

On Wednesday, February 1, Tom Mastrocola, Director of Subscription Marketing at American Express Publishing, gave a guest lecture to Professor Andrea Baron’s Magazine Circulation class. Mastrocola gave the class an in-depth view of how intricate subscription acquisitions truly are and the ways in which American Express works to increase subscriptions to their titles: Departures, Skyguide, Food & Wine, and Travel + Leisure. Consumer marketing departments deal with the acquisition and retention of reader subscriptions. He described working in this facet of the magazine industry as a “numbers-oriented job,” constantly analyzing the amount of subscribers and the balance of revenue versus budget spending.

One important issue facing publishers today is trying to attain a fair price for their products. Readers have become very accustomed to paying a low prices for magazines because publishers were garnering a substantial amount of revenue from advertisers. The ability to rely on advertisers has greatly decreased since the American economy’s downturn, and advertisers have been hesitant to pay for magazine space, creating an imbalance in revenue. Publishers are now trying to create a less ad-centric industry by increasing product price in order to make it consumer-based.

The class was asked to consider where subscriptions really come from. Many people who still believe that subscriptions are mainly derived from newsstands would be surprised to know that newsstand sales have been overtaken by other acquisition initiatives. In 2010, 90% of overall magazine circulation was through subscriptions and only 10% in single copy sales. In fact, American Express’ consumer marketing department depends on direct mailings to successfully acquire and retain 80% of their subscriptions.

Retention groups convince readers to continue renewing their magazine subscriptions by sending them creative renewal notices. Unlike many companies that lose money through circulation and rely heavily on advertising revenue, American Express continues to makes money on circulation, while monitoring their expenses carefully.

American Express also utilizes outside partnerships in order to acquire new readers and further attention to their publications. Their current partnerships with Williams-Sonoma and Kitchen Aid allow people who purchase products from these companies to obtain a free subscription of an American Express magazine, like Food & Wine. Partnerships help increase magazine circulation base and offer an affinity for advertisers’ potential audiences.

Testing and recording results are crucial to the success of future subscription models and acquisition campaigns. Employees study the response rates of each project to see how well they performed in terms of acquiring subscriptions. Modifications are then made to some creative campaigns so as to bring out the best customer responses, and successful campaigns are often reused.

Mastrocola was also excited to announce that by July 2012, American Express magazines will be featured on digital readers as exact replicas of the print versions. In the past, their digital magazines were made up of content different from the print title, including new interactive features that editors used to draw reader interest, like video clips and slideshows. These editions were downloadable, but readers found them too time consuming to download, and they used too much memory space on various platforms. Readers preferred editions that were faithful to the print editions. This streamlined version also benefits advertisers since their digital advertisements will be identical to the print counterparts and provide more opportunities for readers to view them.

Their main goal is to engage readers in sampling American Express magazines. “Once you try a magazine and enjoy it,” Mastrocola notes, “it becomes the editorial department’s job to keep readers interested in our quality products.”

- Diana Cavallo

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