Automakers buy 15 percent of all advertising in U.S. consumer magazines. The cost is high - but so is the return, magazine publishers say.
"The auto industry is the bread and butter of the magazine industry," says Steve Cohn, editor in chief of Media Industry Newsletter, a New York trade publication.
The industry spent $2.4 billion on magazine advertising last year. That's up from $2.1 billion in 2003, the Publishers Information Bureau reports.
Ellen Oppenheim, executive vice president of the Magazine Publishers of America, cites a 2003 study conducted by the trade group. It concluded that for every dollar marketers spend on magazine advertising, they get back an average of $8.23 in sales. Automakers declined to supply their return-on-investment figures for advertising.
The return on a dollar's investment in all other forms of media marketing is $3.52, Oppenheim adds. Magazine advertising is especially efficient because it targets consumers by demographics and lifestyle, she says.
Last year was a record year for total magazine ad spending, Cohn says. Part of that increase reflects the fact that advertisers bought more pages last year.
But it also reflects rising ad rates. Magazines typically raise their rates 3 percent to 5 percent a year, Cohn says.
As a rule of thumb, national magazines charge $10,000 per ad page for every 100,000 in circulation, says Samir Husni, chairman of the journalism department at the University of Mississippi and a leading academic expert on consumer magazines.
But those rates vary. Sports Illustrated generally charges $243,000 for a full-page color ad, says publisher David Morris. That rate increases to $285,750 for the magazine's annual swimsuit issue, Morris adds.
Many magazines give their best ad customers, such as automakers, special treatment. An automotive ad buyer who asked not to be identified says her company buys ad space in bulk and often gets a rate discount of 10 percent to 40 percent.
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