Marketing and feasibility study for launching a city/ regional magazine in Rochester, New York

Transcription

1 Rocheter Intitute of Technology RIT Scholar Work Thee Thei/Diertation Collection Marketing and feaibility tudy for launching a city/ regional magazine in Rocheter, ew York John K. Aiztraut Follow thi and additional work at: Recommended Citation Aiztraut, John K., "Marketing and feaibility tudy for launching a city/regional magazine in Rocheter, ew York" (1989). Thei. Rocheter Intitute of Technology. Acceed from Thi Thei i brought to you for free and open acce by the Thei/Diertation Collection at RIT Scholar Work. It ha been accepted for incluion in Thee by an authorized adminitrator of RIT Scholar Work. For more information, pleae contact ritcholarwork@rit.edu.

2 School of Printing Management and Science Rocheter Intitute of Technology Rocheter, ew York CERTIFICATE OF APPROVAL MASTER'S THESIS Thi i to certify that the Mater' Thei of JOH K. AIZSTRAUTS, MBA With a major in Graphic Art Publihing/Magazine ha been approved by the Thei Committee a atifactory for the thei requirement for the Mater of Science degree at the convocation of MAY 1989 Thei Committee:.u<M...a...r... ie"'-l..-eru;e""'c...,k... le=t... o...oj...-_-----, --,- Thei Advior _ Peter Hanon Thei Advior Mark Guldin Graduate Program Coordinator Mile Southworth Director or Deignate

3 MARKETIG AD FEASIBILITY STUDY FOR LAUCHIG A CITY/REGIOAL MAGAZIE I ROCHESTER, EW YORK by John K. Aiztraut, MBA A thei ubmitted in partial fulfillment of the requirement of the degree of Mater of Science in the School of Printing Management and Science in the College of Graphic Art and Photography of the Rocheter Intitute of Technology. MAY 1989 Thei Advior: Adjunct Profeor Peter Hanon Profeor Mark Guldin Aitant Profeor Marie Freckleton

4 DEDICATIO To Suan Paulette, for her love and patience, and for our future. n

5 ACKOWLEDGMETS I would like to thank all thoe whoe knowledge and/or advice made my printing education poible and memorable. Barbara Birkett William Birkett Joeph Brown Robert Chung W. Frederick Craig Cliff Frazier Marie Freckleton Daniel Gramlich Mark Guldin Peter Hanon Herbert Johnon J. C. McCracken David Pankow Herbert Phillip Archie Provan Werner Rebamen Emery Schneider Juliu Silver m

6 Table of Content Lit of Table vi Abtract vii Specific Purpoe of the Project viii Introduction 1 Why Rocheter eed a City/Regional Magazine 1 General Methodology 3 Market Potential 3 Feaibility 4 Magazine Conceptualization 5 Audience Conceptualization 7 Geographie 7 Age 7 Education 8 Employment 8 Income 9 Sex 9 Verification of Conceptualization and Definition 10 Age 12 Education 12 Employment 12 Income 12 Sex 13 Etimated Metro- R Readerhip 15 Sample Survey of Target Readerhip 20 Competitive Analyi 23 Uptate Magazine 24 Rocheter' Democrat and Chronicle and Time-Union 25 Finger Lake Magazine 26 Rocheter Buine Magazine 27 Advertier Interet 29 IV

7 Ditribution 36 Feaibility 40 Aumption 41 Etimated Revenue 41 Etimated Cot 42 Analyi 43 Summary, Concluion and Recommendation 44 Literature/Reference Cited 45 Reference Appendix A: Reader and Publication Survey 47 48

8 Lit of Table Table 1: Detailed Tabulation of Statitic 17 Table 2: Paid Circulation a a Percent of Population 18 Table 3: Ad Revenue Per Page 29 Table 4: Key Magazine Retailer in Metro-R' Target Market 38 Table 5: Single-Copy Sale and Annual Subcription Rate for Sample City/Regional Magazine 42 vi

9 Abtract A magazine' launch ucce and long-term urvival depend on everal key factor, among which are: 1. The preentation of valuable and/or intereting information to it target market audience. 2. Reaching the appropriate audience with that information. 3. Reaching a ufficiently large audience. 4. Attracting advertier intereted in the magazine' target audience. The four primary factor addre the critical iue of finding a uitable marketing opportunity in term of product and audience, a well a providing a viable medium with which advertier can reach the ame audience. Conequently, how well and quickly a magazine atifie thoe factor will greatly influence it chance for ucce. The magazine launch i therefore dependent upon developing appropriate editorial and reader profile, etimating readerhip ize, and aeing advertier interet. In addition, the overall economic feaibility of the endeavor mut alo be evaluated. Thi project will cover conceptualizing, deigning, developing, and implementing a comprehenive exploration and evaluation of the market for a new, real-life city/regional magazine. vn

10 Specific Purpoe of the Project The primary purpoe of thi project i educational. It intent i to provide practical experience in everal key area of the magazine launch proce. The project' primary goal are: 1. To identify and undertand the critical apect and preliminary work required for launching a magazine. 2. To gain practice in acquiring, developing and utilizing data for making management deciion. 3. To gain experience in working with the appropriate principal in the profeional community. Thee goal have been met a I conducted an actual analyi of the marketing potential and economic feaibility of launching a city/regional magazine for Rocheter, ew York and it urrounding communitie. Conequently, the project ha provided: 1. Invaluable experience in the magazine launch proce. 2. Real data that can be ued for launching an actual magazine. via

11 Introduction Thi project i an evaluation of the market and overall feaibility potential for launching a city/regional magazine for Rocheter, ew York and it urrounding communitie. Many citie throughout the United State already have magazine that focu on the lifetyle() of their reader. In term of editorial matter, thee magazine typically deal with the iue and concern that influence their reader, and hape the city/region into a unique area. Thee magazine tend to explore, inform, and entertain their reader by covering uch divere topic a: architecture, art, buine, culture, dining, event, hitory, people, and place. Since Rocheter currentlyha no true city/regional magazine, thi project will attempt to gauge the market for uch a magazine in Rocheter and it urrounding communitie. Thi project i a real market analyi/feaibility tudy, and the magazine will be a reaonable and appropriate candidate for actual marketing. Why Rocheter eed a Citv/Regional Magazine Rocheter gave birth to modern photography and xerography; it wa home to uffragette and abolitionit, and part of the path leading to the wetward expanion of the United State. Rocheter and it urrounding communitie have a rich hitorical heritage, abundant culture, numerou entertainment/recreational opportunitie, everal outtanding college and univeritie, and many divere buinee. Rated the United State' eighth bet metropolitan area in which to live by Rand Mcally' Place Rated Almanac, Rocheter and it urrounding communitie combine into a truly deirable and vibrant area.

12 Depite thi, Rocheter i frequently ubjected to neglect, even corn by many of it reident. Some of that may be attributable to a general lack of awarene regarding what Rocheter i and ha to offer. Thi apparent informational void may provide an opportunity for a magazine devoted to Rocheter and it neighboring communitie.

13 General Methodology The project' general methodology addree the following central magazine publihing iue: 1. Examination and determination of the magazine' market potential. 2. Examination and evaluation of the magazine' economic and logitical feaibility. Market Potential Examination and determination of the magazine' market potential require addreing four eparate iue. They are: 1. Conceptualizing and defining the magazine' function, form, and format in other word, it formula. 2. Conceptualizing and defining the magazine' reader profile. 3. Evaluating the profiled reader' predipoition to read uch a magazine. 4. Identifying the exiting market' competitive opportunitie and/or threat. The appropriatene of initial conceptualization and definition of the magazine and it reader will be verified by comparion to exiting city/regional magazine from citie with reaonably imilar demographic. ext, actual reader demographic, geographie, and number will be etablihed uing United State Cenu tatitic and other appropriate data. After that, profiled reader will be ampled in order to ae their reading interet and poible predipoition to buy a city/regional magazine focuing on Rocheter and it neighboring communitie. Finally, market opportunitie and/or threat will be evaluated by examining exiting publication for imilaritie in content, readerhip, and niche expoure/coverage. To ummarize, the market potential phae of the reearch will accomplih the following: 1. Define the magazine and it reader.

14 2. Verify the appropriatene of the definition. 3. Etimate the potential number of profiled reader. 4. Ae their predipoition in term of reading. 5. Identify the magazine' marketing opportunitie and/or threat. Feaibility The feaibility of launching a magazine depend in part on the economic of cot and revenue a well a the logitic of ditribution. Magazine economic will be analyzed by comparing etimated production cot with anticipated revenue generated by advertiing ale and paid circulation. Ditribution logitic will be examined by determining the interet of key ditributor and retailer to participate in handling uch a publication. The combined reult of market potential and feaibility analye will be ued to make magazine launch recommendation.

15 Magazine Conceptualization A previouly tated, thi project' intent i to conduct a marketing and overall feaibility tudy for launching a magazine. Eential to that tudy i the formulation of the magazine' character, content, and format, plu the identification and verification of it audience. The following ection addre thee iue. Hereafter, the name Metro-R will be ued for convenient deignation of the magazine under dicuion. Metro-R will be a tudy of the pat, preent, and future of the city of Rocheter, the greater Rocheter area, and it urrounding communitie. Metro-R will expoe thoe thing making the region unique. It will examine the thing having already contributed to haping the region, thing haping it today, and thoe that are likely to play a role in the region' future. The purpoe of the magazine will be to educate, entertain, and enlighten the reader by capturing and preenting the region' eence. By covering a wide variety of topic uch a: people, place, art, adventure, activitie, communitie, culture, commerce, event, economy, hitory, heritage, leiure, and lifetyle, Metro-R will how how their combination create a rare blend of big-city and mall-town atmophere. Each iue will offer the reader an aortment of idea, thing to ee and do, intereting tidbit both urban and rural, handcraft to high-tech, land and lake, the tranquil and the turbulent. By doing o, the magazine intend to: 1. Make the reader more informed and knowledgeable about the region itelf. 2. Make the reader intereted and eager to travel and explore the region. 3. Make the reader undertand and appreciate the region' relationhip with other region within and beyond the boundarie of ew York State. A publication uch a Metro-R i intended for the multi-dimenional, multiinteret reader who tend to be inquiitive and broad-minded. The reader i likely to have

16 the deire and/or curioity to learn about hi home region for ake of peronal enrichment and/or general knowledge. Metro-R i intended to be a monthly, four-color publication of at leat 64 page. Thi would be imilar to other city/regional magazine. It ditribution would be baed on the region of reader interet and focu of editorial matter. That region i likely to correpond only to the communitie identifying with Rocheter rather than Syracue or Buffalo.

17 Audience Conceptualization There mut be preliminary idea regarding the nature of the probable audience. A a reult of firt defining the magazine, the audience become the dependent variable whoe characteritic mut be conitent with the nature of the magazine. Baed upon the magazine' content, format, preentation, and purpoe, the audience i likely to have a trong commonality among everal readily identifiable characteritic which lend themelve to quantitative analyi. Geographie The magazine' audience i likely to be concentrated in a 40 to 50-mile radiu centered in Rocheter becaue the editorial content target thi region. If too wide an area i targeted, editorial coverage become increaingly difficult to focu in uch a way a to attract reader. Too broad a focu editorially and geographically may jeopardize the development of a core readerhip. Without the core readerhip, the publihing ucce of a magazine i at rik. Hitorically, Rocheter ha exerted the greatet influence on the target region making it the region' "big-city." Beyond the 40 to 50-mile radiu, Syracue to the eat and Buffalo to the wet begin exerting the predominant influence. Conequently, editorial coverage will be focued on topic of interet to thoe within the 40 to 50-mile core. The following countie are wholly or predominantly located within the target zone: (1) Geneee, (2) Livington, (3) Monroe, (4) Ontario, (5) Orlean, and (6) Wayne. Age The majority of Metro-R' reader are expected to fall between the age of 35 and 55 with a median age of 45. Although younger and older reader can be expected, their percentage are not expected to be a ignificant a the 35 to 55 group.

18 8 The 35 to 55 range i baed upon the aumption that thee peron are the mot apt to: 1. Have peronal and/or profeional interet in the magazine' content. 2. Have a need for the information preented. 3. Benefit from it content. 4. Have the wherewithal to participate in the general lifetyle addreed by the magazine. Thoe younger than 35 may be preoccupied with finihing educational goal and/or etablihing their career path. They may not yet have an appreciation of the region and it impact upon their live. Thoe older than 55 may no longer have an interet in actively participating in the lifetyle portrayed in the magazine. Education Readerhip i likely to correlate poitively with education. Thi i generally true for magazine and i expected with a magazine of thi type. For that reaon, the audience i expected to be well educated with many of it reader having attended college if not actually graduating and undertaking pot-graduate tudy. Thi aumption i baed on the belief that interet in oneelf, neighbor, community, and important event in general require an intelligent awarene of, and concern for thoe thing. Furthermore, ince the editorial content of Metro-R i geared toward informing and enriching the reader, it aume an audience capable of, and intereted in experiencing and learning new thing. Employment The reader are likely to repreent an occupational tation of profeional, managerial, or highly killed craft employment. In whatever capacity employed, the reader i likely to rely to a coniderable degree on ome form of deciion making in order to perform hi or her job. In hort, hi/her occupational tation i likely to depend on thinking and problem olving.

19 Income The factor of age and education are likely to combine into the occupational profile jut preented, producing an individual with above average income. From the previouly dicued age, education and occupational profile, Metro-R' reader are expected to have a minimum annual income of $30,000 to $35,000. Thi minimum would roughly correpond to a college-educated peron having everal year of job experience. Thi annual income would then be fairly repreentative of the minimum earned by the 35 to 55-year-old block of reader. In general, income' effect on readerhip i poitive in o far a the availability of dicretionary income increae the likelihood of ubcribing. Sex The readerhip i expected to be fairly evenly divided between male and female.

20 10 Verification nf Conceptualization and Definition The initial conceptualization and definition for Metro-R and it audience require teting for appropriatene. The magazine' formula and target audience mut jibe in order to maximize the potential for launch ucce. In order to accomplih thi, citie imilar to Rocheter, which currently have a city/regional magazine were elected for comparion. The primary criterion for election wa population ize becaue of the importance of identifying citie of imilar or maller ize having publihing ucce. Similar or maller citie build a much tronger cae for publihing viability in Rocheter than would larger citie like Boton or Philadelphia. The next tep in the election proce would have been to refine the candidate city lit with additional demographic and geographic criteria in order to identify additional imilaritie to Rocheter. Unfortunately, only eight citie were found with reaonably appropriate population. They ranged from 108,000 to 323,000. Five of the eight were elected for tudy. Letter were mailed to the publiher or editor requeting a ubcriber tudy, a media kit, and a ample magazine. Three magazine reponded. The citie contacted were: Citv Contacted Population2 Magazine 1. Ann Arbor, MI 108, Grand Rapid, MI 186,000 (Rocheter, Y) (236,000) 3. Tampa Bay, FL 277, Louiville, KY 286, Sacramento, CA 323,000 Ann Arbor Oberver Grand Rapid Magazine (reponded) {Metro-R) Tampa Bay Magazine Louiville Magazine (reponded) Sacramento Magazine (reponded) Recall that Metro-R' audience profile ha been defined a: Age: 35 to 55, median 45 Education: College or better Employment: Profeional, managerial, or highly killed Income: $30,000-$35,000 and up Sex: Approximately 50% male, 50% female

21 11 The reponding magazine provided the following information about their readerhip. Grand Rapid Magazine* Age: 25 to 49, median 34 Education: 77% attended college or have graduated Employment: o information Income: $30,000 to $60,000, median $44,000 Sex: o information on ditribution Grand Rapid' population of 186,000 upport a paid circulation of 6,200 with a readerhip of 12,000. Thee figure correpond to 3.3% and 6.4% of the population repectively. Louiville Magazine1* Age: Average age i 49 16% of reader are % of reader are % of reader are Education: 83% have attended college or better 59% are college graduate 34% have pot graduate education Employment: 52% of reader are profeional or in management Income: Average houehold income i $74,200 Median houehold income i $52,800 Sex: Readerhip i 56% male and 44% female Louiville' population of 286,000 upport a paid circulation of 21,353 with a readerhip of 68,394. Thee figure correpond to 7.5% and 23.9% of the population repectively. Sacramento Magazine Age: Median 44.6 Education: 28.8% attended college 23% graduated college 10.4% pot graduate work 19.3% pot graduate degree Employment: 20.5% Profeional & technical 34.2% Management Income: $35,000 and over 80.6% (houehold) $50,000 and over 58.9% $75,000 and over 29.2% Average income $76,593 Median income $57,394 Sex: Readerhip i 49.4% male and 50.6% female

22 12 Sacramento' population of 323,000 upport a paid circulation of 25,282 with a readerhip of 75,000. Thee figure correpond to 7.8% and 23.2% of the population repectively. In comparion to the three repondent magazine, Metro-R' audience profile conceptualization and definition appear reaonably accurate and correct for the type of publication being deigned. Age Metro-R' audience i expected to be primarily age 35 to 55. Louiville' larget reader egment i the 35 to 55 age group, with a relatively even ditribution of reader in the 25 to 34 and 55 to 64 range. Sacramento' median age of 44.6 i identical to Metro- R' expected median age of 45. Grand Rapid eem to appeal to omewhat younger reader. It age range i 25 to 49 intead of 35 to 55 and it median i 34 intead of 45. Education All three repondent magazine point to a very educated audience. The magazine how 77%, 83%, and 81.5% of their reader having at leat attended college. More importantly, Louiville how that 59% have graduated college while Sacramento ha 23% college graduate. Employment Louiville how 52% of it reader a being profeional or management level peron. Sacramento ha nearly 55% employed a profeional, technical peron, or manager. Income All three repondent indicated affluent reader. Grand Rapid' reader have a median income of $44,000 while Louiville how an average houehold income over $74,000 and a median income nearly $53,000. Sacramento' average houehold income i over $76,000 and median income i over $57,000.

23 achievement."7 guide." 13 Sex Readerhip doe eem to be divided equally or fairly equally among male and female. Metro-R' overall magazine decription wa teted by comparing it to the editorial profile decription ued by other city/regional magazine. Publihed in The Standard Rate and Data Service of Macmillan Inc. (SRDS),6 thee decription are ued by advertiing agencie to help elect magazine appropriate for their advertiing need. The SRDS decription for Grand Rapid Magazine, Louiville, and Sacramento are given below. Grand Rapid Magazine "i a general feature city/regional magazine devoted to the interet, activitie, and iue of metropolitan Grand Rapid and the wetern Michigan area. It ha conumer ervice department, interpretive article, and people oriented feature. Service include popular dining guide with review, fahion and calendar of event. Monthly column cover travel, lifetyle, art, media, port, entertainment, and Louiville decribed itelf a "edited for reader active in buine, government and community affair in the city and it Kentucky-Indiana regional area and member of the Community Public Broadcating televiion tation. Feature article deal with community growth in the field of urban development, finance, culture, ocial ervice, education- - highlighting program, peronalitie and group involved in problem-olving throughout a broad pectrum of urban affair. Regular monthly department include column on tyle, travel, deign, money, cuiine, bet buy, hitory, buine new, phyical growth, plu a program guide for local public televiion, a dining guide, and art, leiure, port, and event Sacramento "i edited for educated, active Sacramentan, with their particular lifetyle in mind. Article invetigate iue in area uch a crime, health care, the environment and politic; while highlighting local buine, real etate, travel, fahion,

24 14 food and wine. Regular department include a calendar of event, Home & Garden, Outdoor, Dining Out, Peronal, Finance, Travel, Hitory and City Light." Baed on thee decription of exiting city/regional magazine, Metro-R' decription i in agreement with the type of magazine being deigned and the audience being targeted. According to the analye of audience and magazine, Metro-R' conceptualization and definition are found to be appropriate.

25 15 Etimated Metro-R Readerhip In a magazine launch ituation, etimating the potential readerhip ize i important for developing initial figure on the launch' feaibility. The readerhip etimate i neceary o that circulation planning, production cot, advertiing ale, and overall revenue can be calculated. Two important quetion need to be anwered. (1) Will there be enough reader to upport publication? and (2) Will there be enough reader to attract advertier? Thi ection will primarily focu on the quetion of having enough reader to upport publication. The quetion of having enough reader to upport advertier will be addreed in a later ection. Potential readerhip number were compiled via United State Cenu tatitic and other appropriate data.10 The countie of Geneee, Livington, Monroe, Ontario, Orlean, and Wayne were analyzed in term of: 1. Population ditribution 2. Educational characteritic 3. Income ditribution 4. Occupational profile The following i an overall ummary of the tatitical, demographic, and geographic analyi of Metro-R' target market.

26 16 Population by age group for all countie Primary target market individual age 35 to 55 Overall individual age 25 to , ,890 Education for all countie College graduate at leat 25 year old 120,885 Income for all countie Houehold with total gro income $25,000-$34,999 Houehold with total gro income $35,000 and over Individual with total gro income $25,000-$34,999 Individual with total gro income $35,000 and over 71, , , ,0001 Occupation Profeional/Managerial: Geneee County (U.S. Cenu data) Livington, Monroe, Ontario, Orlean, Total and Wayne countie 4, ,722

27 17 Table 1 Detailed Tabulation of Statitic Geneee Livington Monroe Ontario Orlean Wayne Population 25/34 35/44 45/54 55/64 Total % Annual Growth Total 35/55 9,145 10, ,314 14,601 5,967 13,261 7,847 7, ,900 13,578 5,148 12,816 5,782 5,700 71,306 9,393 3,783 9, ,084 28, ,060 45,849 18,379 42, % 0.7% 0.1% 0.5% 0.4% 0.8% 13,629 13, ,206 22,971 8,931 22,161 Education College Graduate14 4,125 5,079 94,891 8,388 2,261 6,141 Houehold by Income $25-34,999 4,536 4,020 46,632 7,140 2,674 $35-49,999 4,011 4,120 54,404 7,276 2,800 $50-74,999 2,310 2,440 46,096 4,250 1,610 $75, Total 11,508 11, ,304 20,230 7,476 6,240 6,848 4, ,240 Occupation Profeional/Managerial 4,722 Thee five countie total 184, Uing paid circulation and population tatitic from other citie with city/regional magazine, audience etimate can be developed. The following table calculate paid circulation a a percent of overall population.

28 18 Table 2 From SRDS Population 16 Paid Percent V. City Citv Metro Circulation City Metro San Diego 876,000 1,862,000 67, Baltimore 787,000 2,174,000 53, Cleveland 574,000 1,898,000 39, Columbu 565,000 1,093,000 34, ahville 456, ,000 11, St. Loui 453,000 2,355,000 25, Sacramento 323,000 1,014,000 25, Louiville 286, ,000 21, Tampa Bay 277,000 1,569,000 9, <1 Grand Rapid 186, ,000 6, Rocheter ha a city population of 236,000 and a metropolitan population of 972,000. Baed on overall city and metropolitan comparion, Louiville appear to be mot imilar to Rocheter. Although Tampa' city population i cloer to Rocheter', Tampa' metropolitan area alo include the city of St. Peterburg. For that reaon, Tampa i diqualified from further circulation comparion. Louiville magazine ha a 7.5% penetration of it city population and a 2.3% penetration of it metropolitan population. Thee percentage will be ued a rough etimate for calculating Metro-R' circulation. Metro-R' etimated city circulation: 236,000 x 7.5% = 17,700 etimated ubcriber Metro-R' etimated overall metropolitan circulation: 972,000 x 2.3% = 22,356 etimated ubcriber Baed on thee rough etimate of circulation, it appear that Metro-R may be able to generate a circulation imilar to viable city/regional magazine currently being publihed.

29 19 However, thee number alone hould not form the ole bai of determining Metro-R' viability. There mut be further evaluation of reader interet, cot factor, and advertiing revenue generation. The overall economic feaibility of Metro-R can only be judged after revenue. comparing production cot with circulation and advertiing Evaluation of thee economic iue will be performed in a later ection.

30 20 Sample Survey of Target Readerhip Exiting city/regional magazine are publihed for audience like that profiled for Metro-R and verified by Sacramento and Louiville. Although each city/region i likely to have difference in character making it unique in certain way, the variou city/regional magazine are imilar if not identical in term of editorial matter and format. After all, the target audience erved by thee magazine i eentially identical, regardle of city/region. Of coure, demographic variation exit between citie and region but the baic age, education, income, and occupation profile characteritic are likely to remain contant, i.e., affluent and educated reader. A a reult, the preence of numerou city/regional magazine verifie the need thi audience profile ha for obtaining information about it city/region. Although thee audience deire much of the ame type of information, each city/region may alo have unique or particular reader interet/need that hould be conidered. A quetionnaire wa ditributed to a mall ample of the profile audience. Thi ample urvey of Metro-R' target audience wa taken to determine if there wa interet in reading about the city/region and if there wa any indication of atifaction/ diatifaction with exiting publication. The urvey aked the target audience ample to: identify publication read, indicate frequency and depth of reading, provide uggetion for change/improvement, and provide demographic information. Eighty quetionnaire were ditributed to peron likely to be from the Metro-R audience profile. Approximately 50 were ditributed to MBA clae at Rocheter Intitute of Technology and approximately 30 were ditributed within the community in general. Twenty-even quetionnaire were completed and returned repreenting 31 individual. Four of thoe quetionnaire contained repone from both huband and wife. Although the ample ize and repone were too mall for meaningful tatitical analyi, valuable inight wa obtained neverthele.

31 torie." pecific." reporting." torie." paper." coverage." 21 The repondent were 48% female and 52% male which i reaonably cloe to the expected 50:50 male:female readerhip ratio. Repone came from Geneee, Monroe, and Wayne countie including everal outlying town/communitie within the targeted geographic market. Income ranged from the $15,000-$24,999 category up to and including the $75,000+ category. Education wa predominantly college level and above with age ranging from 22 to 60. Other initial reult howed that: 100% read the major local/regional newpaper 33% read their town' or village' newpaper 16% pecifically tated reading Uptate Magazine Depite the mall ample which did not allow meaningful tatitical inference, comment provided valuable information regarding uggetion for change/improvement to regional and/or local publication. The comment were: "I jut hope Rocheter keep having two different "Le general, more local "Get real new "More local interet "More in-depth and more focu "Uptate hould offer more local and regional Some of the comment addreed the need for publication to provide more local and/or regional information. Other comment hinted at deficiencie in local publication in term of the information provided. Unfortunately, the limited ize of the urvey doe not allow pecifically pin-pointing what deficiencie exit nor what type of information i pecifically deired. However, when ix of 31 repondent (19%) indicate ome form of diatifaction with exiting local/regional information, the atute marketer i likely to ene that ome ort of opportunity may exit for publihing. aturally, a much larger ample and/or more detailed inquiry into the diatifaction could iolate and identify the underlying

32 22 reaon for the diatifaction, but for the purpoe at hand, the urvey pointed to potential publihing opportunitie. In view of the fact that ucceful city/regional magazine are targeted for the type of audience Metro-R intend to attract and that there exit diatifaction with available local/regional publication, Metro-R may have a receptive audience and thu a viable market.

33 23 Competitive Analyi A magazine launch require examination and analyi of market need and competition within the target market. The examination and analyi i performed o that management can determine what opportunitie and/or threat may exit for the new magazine. That analyi hould identify appropriate publihing opportunitie that can be uccefully addreed by the new magazine. Likewie, the analyi hould identify ituation to avoid. Thi competitive analyi will examine potential imilaritie between Metro-R and exiting publication available in the greater Rocheter area. Thi analyi will focu on the function, form, and format of exiting publication a they relate to the intent and preentation of Metro-R. Function i concerned with the nature of information publihed and it readerhip. Form i primarily concerned with analyzing the type of publication it i, i.e., it generic claification. Format deal with the way information i preented. Together, thee three variable hould point out imilaritie of Metro-R to exiting publication. The fewer the imilaritie, the greater the market opportunitie. The Rocheter area ha numerou publication panning a variety of topic and audience, yet Metro-R i not competing with mot. However, Metro-R ha ome editorial content, audience, and/or geographic focu imilaritie to five exiting publication. They are: (1) Uptate Magazine, (2) Rocheter Democrat and Chronicle (D&C), (3) Rocheter Time-Union (TU), (4) Finger Lake Magazine (FL), and (5) Rocheter Buine Magazine (RBM). Each will be evaluated in term of function, form, and format plu the degree of competitive impact upon Metro-R' potential readerhip and advertier. ote: Data cited for Uptate Magazine, Rocheter Democrat and Chronicle, and Rocheter Time-Union i provided by Gannett Rocheter ewpaper' 1989 media kit.

34 24 Uptate Magazine Uptate Magazine i a upplement to the Sunday edition of the Democrat and Chronicle. Although it i a Sunday upplement, Uptate i likely to be Metro-R' chief competitor. Uptate' overall editorial content, theme, depth, and cope of coverage i imilar to that intended for Metro-R. Uptate' function i to provide coverage of local and regional hitory, intereting people, place, and other regionally relevant item. A uch, Uptate may be conidered the area' primary lifetyle publication. A a newpaper upplement, Uptate i not targeted for, or circulated excluively to Metro-R' target audience. Uptate claim a readerhip of 552,000 yet Metro-R' primary age group of 35 to 55 account for only 32% of Uptate' reader. In term of occupation, profeional and manager account for only 29% of Uptate' reader. Even though mot of the area' profeional/manager receive Uptate (147,000; 78%), o do 405,000 other reader. In hort, Uptate may deliver a large audience, but it i neither well targeted nor tightly defined. In term of form and format, Uptate i a weekly, 12 to 16-page, four-color newprint upplement. Conequently, Uptate i not a production quality competitor for Metro-R. The production quality difference will favor Metro-R in term of reader appeal and advertier regard. Overall, Uptate doe reach Metro-R' target audience and contain imilar editorial having reader impact becaue of the heer volume of readerhip. However, Uptate i circulated automatically with the Sunday paper meaning that Uptate i largely a bonu of purchaing the Sunday edition. Uptate i not likely to be the ole reaon for purchae. Thi mean that Uptate probably doe not elicit the actual buying behavior and therefore the reader i likely to have a relatively low level of involvement or particular need for Uptate. In term of advertiing impact, Uptate' mall ize and relatively low production quality prevent it from capturing large advertier. Uptate i not a favored medium for

35 25 thoe intereted in placing high quality advertiement. Almot no four-color advertiing appear in Uptate. Although Uptate may have ome reader impact relative to Metro-R, it ha little impact on diverting Metro-R' potential advertier. A a reult, Metro-R ha the following advantage. 1. Larger page count giving it the opportunity to provide extenive editorial matter and carry numerou advertiement. 2. Better targeted and focued reader who are more motivated to buy the particular content offered. The better audience targeting offered by and read Metro-R i epecially valuable for advertier. 3. Superior production quality. Again a valuable conideration for advertier. 4. Longevity. A a monthly, Metro-R i likely to remain on-hand for a longer period of time than a weekly. Rocheter' Democrat and Chronicle and Time-Union Thee are Gannett' metropolitan newpaper for Rocheter. Their function i typical of metropolitan newpaper; that of providing information on international, national, tate, regional, local, port, and buine new. Both newpaper cover editorial matter imilar to that intended by Metro-R a well a editorial matter that Metro-R will ignore. The D&C and TU alo hare much of Metro-R' geographic market. Depite editorial and geographic imilaritie, the newpaper emphaize providing up-to-the-minute new coverage rather than focuing on in-depth exploration of le new-worthy or enational torie. The information provided by the newpaper generally ha a hort longevity veru a magazine' greater informational durability. The newpaper enjoy a far greater readerhip than can be expected for Metro-R. On a daily bai, 435,000 read the newpaper while the Sunday D&C ha a 552,000 readerhip. A hown with Uptate, thee number repreent audience dilution, not concentration. Metro-R' age profile correpond to 35% of daily readerhip and 32% of

36 newpaper' 26 Sunday' readerhip. The profeional/managerial occupational category correpond to 28% of daily and 29% of Sunday reader. In term of form and format, they are both broadheet newprint offering occaional 2 to 4-color work. The D&C i the weekday morning paper plu Saturday and Sunday edition. The TU i trictly an evening paper Monday through Friday. Metro-R ha the following competitive advantage over both newpaper. 1. Magazine-type coated tock veru newprint. A ditinct viual difference including production quality uperiority. 2. Specifically focued, concentrated, and defined readerhip. 3. In-depth coverage of enduring topic rather than "new-item" emphai. 4. A motivated audience intereted in reading focued editorial matter rather than "around-the-world" coverage. Metro-R ha an overall ditinctivene when compared to the D&C and TU. A a magazine that preent a defined limit of editorial matter to a narrowly defined audience, Metro-R i baically the oppoite of the newpaper. Conequently, the degree of reader impact would be imilar to Uptate'. Finger Lake Magazine Finger Lake Magazine ha many functional, form, and format imilaritie to Metro-R. Finger Lake Magazine cover much of the ame type of editorial matter a Metro-R and preent it to much the ame type of audience. Conequently, FL probably attract a number of Rocheterian becaue of ome minor geographic overlap and the fact that ome reader own vacation home in the Finger Lake region. To thee Rocheterian, FL may be a viable a magazine a Metro-R. Finger Lake' form and format i almot identical to Metro-R' except that FL i publihed bi-monthly wherea Metro-R will be monthly.

37 27 Depite ome trong competitive imilaritie, Metro-R ha advantage. 1. Finger Lake ha limited ingle-copy ale in Metro-R' area. Only three of Metro-R' potential city of Rocheter retailer carry it. 2. Although ome reader from Metro-R' area may prefer FL, advertier do not. ot one Metro-R area advertier wa found in FL\ The advertier were predominantly from Ithaca, ew York and Binghamton, ew York. either Ithaca nor Binghamton are conidered to be part of Metro-R' area, culturally or economically. Even though Metro-R and Finger Lake are imilar magazine with nearly identical reader profile and FL i available in the Metro-R area, the competition i limited in term of readerhip and nil in term of Metro-R' potential advertier. The ditinct geographic orientation of the magazine minimize reader competition and virtually eliminate the potential for advertier cro-over. Rocheter Buine Magazine Rocheter Buine Magazine i a "Time-ize," four-color, gloy tock magazine, publihed on a monthly bai whoe function i preenting buine and buine-related information to much the ame audience a Metro-R'. Thi offer direct competition over buine editorial if Metro-R eek to include uch editorial. Rocheter Buine Magazine i currently looking to introduce a new feature called "Vignette," which i going to be capule profile of people, buinee, and idea. Thi ha a negative impact on Metro- R' chance of providing intereting and meaningful buine-related editorial matter. Depite potential conflict over editorial preentation, Metro-R' overall poition i not affected ignificantly becaue it will carry a wide range of topic. Furthermore, even though RBM i geared toward the buine community, it total ditribution i only 17,000 which i 9% of the Metro-R area' profeional/manager.17 Rocheter Buine Magazine ha not enjoyed extenive penetration of it own market.

38 28 Metro-R ha the following competitive advantage. 1. Audience ize i likely to be larger becaue of it wider editorial coverage. Thi will reult in expoure to more buine reader than RBMl If that happen, buine advertier may opt for advertiing in Metro-R intead. 2. Metro-R ha a much wider geographic coverage. In ummarizing the competitive ituation facing Metro-R, there are overlap and imilaritie in term of editorial content, depth of coverage, and cope of topic. However, no ingle publication put all the element together in the ame function, form and format package of Metro-R. That in itelf may provide market opportunity. Metro-R i likely to deliver an audience more defined than Uptate, the Democrat and Chronicle, and the Time-Union becaue it focue on a narrower egment of the population. Thi i a definite advantage to many advertier who mut target their audience for cot-effective and buine generating advertiing. Finger Lake i a twin of Metro-R' but it limited competition for Rocheter area reader prevent area advertier from utilizing FL a a viable advertiing vehicle. Although Metro-R may loe ome reader to FL, it doe not rik loing advertier. Rocheter Buine Magazine' focu on one editorial theme preent limited competition for Metro-R ince Metro-R ha numerou other editorial topic available. The fact that RBM i ditributed to only 17,000 mean that Metro-R' broader editorial coverage may attract more profeional/manager than RBM. In doing o, Metro-R may prove to be a uperior buine advertiing vehicle! Baed upon thee capule analye, Metro-R appear to have reaonable opportunitie for it editorial coverage and advertier appeal.

39 29 Advertier Interet Advertiing interet in, and upport of a magazine i extremely important to it ucce and publihing viability. Thi i epecially true for a magazine being launched becaue advertiing often generate over half the magazine' total revenue. Therefore, it i of paramount importance for a new magazine to quickly attract advertier. ot only doe advertiing account for much of the magazine' revenue, it alo repreent much of it content. Often 40 to 60% i advertiing. For example, the January and February 1989 iue of Louiville Magazine contained 42% advertiing veru 58% editorial. The March 1989 iue of Sacramento Magazine contained 45% advertiing and Rocheter Buine Magazine' February 1989 iue contained 56% advertiing. Sample advertiing revenue were calculated by multiplying the iue' ad pace with the magazine' rate card ingle-copy inertion price. Louiville, Rocheter Buine Magazine, and Sacramento provide thee example of advertiing revenue. Table 3 Ad Revenue Per Page Approx. Approx. Etimated Ad Ad Revenue Magazine Iue Ad Revenue Page Per Ad Page Louiville Jan. '89 $ 66, $2,460 Louiville Feb. '89 $104, $2,380 Rocheter Buine Magazine Feb. '89 $69, $1,726 Sacramento Mar. '89 $149, $3,180 Thee magazine are generating an average of $2400 or more of advertiing revenue per ad page! It become readily apparent why a new magazine mut ecure trong advertiing interet a quickly a poible. Metro-R face a doubly challenging tak. ot only mut it preent itelf a an attractive and appropriate vehicle for advertiing, it mut alo convince advertier and advertiing agencie of it uperiority over the publication they already ue.

40 30 Metro-R' trategy for accomplihing thi mut include: 1. Delivery of uperior editorial matter and printing quality. 2. Conitent delivery of a pecific, identifiable and ufficiently large readerhip. If Metro-R ucceed with thi trategy, advertier and advertiing agencie hould be willing to conider it a a reaonable and perhap uperior vehicle over exiting publication. Every magazine type tend to attract certain advertier more than other. Thi i a function of properly matching advertied product and ervice with the mot likely uer and buyer. By examining city magazine from Louiville, Sacramento, Toronto, Boton, Philadelphia, and the Media etwork Incorporated package of ewweek, Sport Illutrated, Time, and U.S. ew and World Report for Rocheter, the following repreentative but not exhautive lit of typical advertier wa developed. Accountant Automobile dealer Bank Bar/ightclub Caterer Clothing retailer Corporate, buine, & indutrial advertier Country club Employment recruiting Florit Gallerie Health club Home developer Home furniher Home improvement contractor Hotel Inurance agent Invetment ervice Office furniher etwork Televiion Station PBS tation Radio Station Realtor Retaurant Tourit attraction Travel agent Vintner

41 31 Thi lit of proven city/regional magazine advertier give Metro-R direction for focuing it marketing effort. Recall that Metro-R i looking for advertier intereted in an audience profiled a follow: Predominantly Male and Female College educated or better Individual income $30,000-35,000 minimum Employed in a profeional or managerial capacity Louiville and Sacramento magazine verified thi audience profile a appropriate for a city/regional magazine. Since the profile ha been etablihed, the next tep in advertiing reearch i to determine the level of advertiing interet and upport for Metro-R. Thi can be attempted in two way: 1. Directly quetioning potential advertier regarding their interet in the new magazine. 2. Evaluating the advertier' previou actual behavior toward the readerhip. 3. Quetioning ad agencie about their potential interet. Direct quetioning ha the advantage of quickly gathering indication of poible advertiing interet and intent. However, the reult obtained are not likely to have high validity becaue: 1. People are inclined to repond in term of what other want to hear. 2. The propective advertier would be addreing a hypothetical ituation without conequence to him or her. He/he wa not aked to make an actual financial commitment to buy ad pace. Therefore, direct quetioning will not be ued to gather indication of advertier interet and/or upport. Intead, evaluation of actual advertier behavior relative to Metro-R' audience profile will be analyzed. Data from Louiville, Sacramento, and Grand Rapid magazine how that advertier will buy ad pace in city/regional magazine targeted for the ame audience profile a Metro-R.

42 32 In the Rocheter and greater Rocheter area erved by Gannett Rocheter ewpaper, there i further favorable evidence of advertier behavior. For it circulation in Livington, Monroe, Ontario, Orlean, and Wayne countie, Gannett ha already planned the following pecial and ha the date included in the media kit. March April May June July Augut September October ovember December Automobile, kitchen, bath, cruie, travel, home furnihing. Fahion, home furnihing, yard & home Car care, wimwear, ew York vacation 89th U.S. Open, and Homearama Boat and RV' Back to chool European and Caribbean Home improvement, travel, fahion, home furnihing Home furnihing, travel, car care Skiing, gift, Toronto travel Accent on the un The Gannett publication, the Democrat and Chronicle, Time-Union, and Uptate Magazine, cover the following audience % of thoe age % of thoe age % of thoe with income $35,000-$49, % of thoe with income $50, % of all profeional and manager 61-79% of college attendee 63-77% of college graduate Another local publication, Rocheter Buine Journal, ha alo pre-cheduled many feature. April June Augut September October ovember Real etate Ontario county, port & recreation Real etate Art, entertainment, automobile Travel Retail Rocheter Buine Journal i a 36-page weekly tabloid with a total readerhip of 34,000. Quoting their media kit,

43 33 Rocheter' mot influential and affluent buine executive and profeional are among the journal' avid reader. A a group, thee buine deciion-maker earn more than $77,000 annually, poe a high level of education, and pend ignificantly more than the average on corporate and peronal item. It readerhip' median age i 44.7, and 78.3 have graduated college. Rocheter Buine Journal i not conidered a ignificant competitor for Metro-R becaue:19 1. Male account for 78.8% of reader yielding a ration of nearly 4 to 1, male to female. Thi i not in-line with Metro-R' profile. 2. It i a proven buine publication erving the area for over 15 year. Metro-R i not looking to preent the detailed buine new and event carried by Rocheter Buine Journal. The quetion of whether Metro-R will attract a readerhip of ufficient ize ha been addreed. Other magazine from citie imilar in ize to Rocheter do attract advertier. Rocheter Buine Magazine with only 17,000 reader and Rocheter Buine Journal with 34,000 reader are narrow-topic magazine attracting a variety of advertier type. Metro-R will probably match thoe readerhip ize while offering a broader cope of topic. Thi can only enhance the opportunitie for advertier to match their product/ervice with the type of editorial preented in Metro-R. The advertier have opportunitie to match their product/ervice to a variety of reader interet and frame of mind. Furthermore, pre-cheduling of feature point to the teted and proven capability of thee publication to ecure ufficient advertiing from the appropriate advertier. Thi demontrate advertiing interet in reaching an audience identical to Metro-R' profile. In addition, ome advertiing agencie, including Hutchin Y&R, were contacted and aked about their interet in utilizing Metro-R a a viable mean to reach an upcale audience. They all aid Metro-R would be appropriate. Conequently, there i reaon to

44 magazine.21 advertiing!23 34 believe that Metro-R can indeed provide an appropriate alternative for delivering an advertier' meage to the ame readerhip. However, although Metro-R can deliver the ame audience, advertier mut firt be convinced that it can do o with conitency and reliability before witching ignificant advertiing expenditure toward Metro-R. Audience delivery can be teted and proven only over time. Therefore, Metro-R' tak i to convert the advertier' initial attraction for the novelty of a new magazine into confidence regarding Metro-R' dependability in delivering the right audience. Metro-R ha certain trength making it an attractive advertiing option for Rocheter and it urrounding communitie. They are: 1. Attractive package. It will be a "Time-ize," four-color, gloy-tock magazine providing intereting and popular editorial matter. 2. Audience. It will deliver the region' mot affluent and influential reader. 3. Longevity. A a monthly publication, each iue i likely to remain in circulation, i.e., available for reading, for a relatively long period of time. Sacramento' reader refer back to the magazine an average of three time. Forty-three percent read the magazine for up to two hour while 21.7% pend up to three hour reading the Louiville' reader pend an average of 68 minute reading and refer back to the magazine three time.22 Seventynine percent have kept four of four previou iue. More amazing i that 98% have read ome to all of the 4. State of mind. Metro-R i likely to be read at home and at a leiurely pace when the reader i relaxed. The home etting i likely to offer fewer ditraction than the work etting and thu allow better concentration. The relaxed tate of mind and better concentration benefit advertier. Recall Louiville' 98% advertiement reading.