Exam hints and tips

Before the exam, you MUST be able to discuss the following things in detail with examples:

· Ownership in the magazine industry and how this affects production, consumption, marketing and distribution etc

· The relationship between magazine institutions, their readers and their advertisers

· The importance of convergence and synergy and how this affects production, consumption, marketing and distribution within the magazine industry

· New technologies and how they have affected production, consumption, marketing and distribution within the magazine industry

· Why magazine companies struggle to retain readers, and everything they do to target and attract readers

Remember that the examiner is going to be marking you on the following things:

· Your knowledge of magazine institutions and audiences

· How relevant your answer is to the question

· How well structured your argument / answer is

· How you relate your case study of Hearst / Cosmo to the question

· The number, range and relevance of your real evidence / examples you use to back up your answer

· Your use of key terminology, correctly and appropriately

Your use of grammar, punctuation, spelling etc

Essay questions to practise with

Using examples from your case study, discuss the idea that audiences are responsible for the change in production / distribution and marketing of a media product

Discuss who you believe is has more power in the media world, the audience or the institution.

Discuss the relationship established between an institution and its audience

To what extent do institutions use synergy and why?

The media industry is dominated by global institutions whose only purpose is to make money. How far does your case study support this view?

The evolution and development of technology has had a massive effect on both audiences and institutions. Explain how this relates to your case study.

To what extent are Institutions dependent on their audience for survival?

The ownership of an institution plays an important role in their success and survival. Discuss

What are the issues raised by the ownership of an institution?

How important are convergence and synergy for an institution?

Technology is now proliferate in audiences’ lives and means that content is now easily accessible anywhere, anytime. Discuss how this relates to your case study.

How do institutions target a specific audience?

What issues are raised when an institution needs to market a product to a specific audience?

Global institutions tend to dominate the market. Can you explain why using your case study?

What factors influence the change in production, marketing, consumption and distribution of a media product?

Key terminology to use in essays

Audience Expectation – Refers to what the audience expects or looks forward to. These have changed considerably over the years as audiences have become more demanding.

Brand Awareness – This refers to the knowledge the audience has of the product and the company that makes it. Companies always want the audience to have a large amount of brand awareness

Circulation – Refers to the number of products sold, normally per month

Consumption – Refers to the audiences actually buying and using (reading) the product

Convergence – Technological Convergence is when technologies develop and come together (eg: print and internet.) Eg you can view magazines online on your phone now, you can create your own video on your computer, you can download apps for everything etc

Cross Promotion – Is the use of other magazines or sites to promote one magazine. For example Hearst place adverts for Cosmopolitan Magazine in Company magazine which they also own.

Demographic – Refers to the type of person that consumes a media product. For example, “the demographic for Cosmopolitan magazine is ABC1 women aged 18-35”.

Distribution – Refers to anything a company does to get a product from the producers to the audience. This often includes things like delivering the product to shops, but can also include marketing and advertising the product.

EDP – Electronic Data Processing is a technology developed by COMAG (co-owned by Hearst UK and Conde Nast) which allows market research to be carried out every time someone purchases a Hearst Magazine. They can monitor the type of reader buying the magazine, as well as what other items the reader purchased at the same time

Horizontal Integration – When a company produces lots of similar products. For example: “Hearst UK is able to take advantage of horizontal integration as they produce 20 magazines within the UK and Hearst International produce 200 worldwide which allows them to recycle articles and photographs, and cross promote their magazines within each other to increase readership.” It can also be seen as Horizontal Integration that Hearst UK has more than one Cosmo related product (eg magazine, website, phone app, social networking site etc). Companies LOVE horizontal integration as it mainly means they can save money and increase profit. Hearst UK clearly wanted to increase their use of horizontal integration because in 2007 they bid £700 million in an attempt to buy and take over EMAP which was another company in the oligopoly. EMAP turned down the bid and instead sold to Bauer for £1.4 billion!

Instant Gratification – Refers to a need people have to be pleased / entertained / satisfied as quickly as possible. So audiences need “instant gratification” otherwise they get frustrated, annoyed, bored etc.

Institution – another word for “company”. So Hearst UK is an institution

Marketing – Refers to anything a company does to promote or advertise their products. This could include posters, TV ads, product placement, setting up Facebook groups etc..

Oligopoly – An Oligopoly is where several companies have grown larger and larger whilst competing, to the point where they have relatively equal power and they dominate the market, making it virtually impossible for smaller companies to exist.

Synergy – Is the use of other technological media platforms to promote a product. For example Hearst use the internet, mobile phones, social networking to promote Cosmopolitan magazine.

User Generated Content – Refers to any material that was produced by the audience, not the professionals. For example, videos on You Tube are made by real people, readers send in their own photos to the magazine etc

Uses & Gratifications Theory – a theory which tries to explain how audiences have different needs and if a company wants to be successful, they should try and “gratify” or fulfil those needs. The 5 main things this theory suggests audiences want are entertainment, education, escape, social interaction and something to identify with

Utopian Solutions Theory – a theory which suggests that audiences have lots of problems and that if a company wants to be successful, they need to provide solutions to people’s problems. Boredom can be solved by entertainment, confusion can be solved by clarity, isolation can be solved by offering people a community and loneliness can be solved by offering people social interaction.

Vertical Integration – When a company can fulfil more than one stage of the production process themselves. So “Hearst UK doesn’t just produce the magazine and employ others for research / distribution / marketing. They do research themselves (and using COMAG) through Facebook and emails, Comag (part owned by Hearst UK remember) do research using EDP, Comag do the distribution and Hearst UK do the marketing using emails / texts / social networking etc.”

Web 2.0 – Refers to new media technologies online that allow users to interact and contribute. For example, chat forums, blogs, You Tube, social networking sites

COMAG

COMAG is a magazine marketing and distribution company, responsible for

· Carrying out market research into target markets – Finding out their interests, background, hobbies, etc Also responsible for monitoring their reaction to special offers and content of the magazine

· Carrying out marketing for various magazines including creating TV adverts, web adverts, promotions, running social networking fan groups for the magazines in its portfolio, contacting readers via email / text to encourage them to purchase the magazine

· Distributing the magazines in their portfolio from the publishers to the warehouses / shops

COMAG was set up as a joint venture by Hearst UK (Natmags) and Conde Nast. Part owning this company gives Hearst UK and Conde Nast an advantage over other magazine companies as they do not have to pay an outside company to do their marketing and distribution. They can carry out these activities “internally” saving them money and time.

Around 10 years ago, COMAG took an existing technology called EDP (Electronic Data Processing and developed it even further. EDP is a technology which allows data to be stored and recorded in items such as barcodes and credit card strips. The purpose of this is so that when an item is scanned at a shop, COMAG can use EDP to monitor the other items that a customer purchases with it. If the customer uses a credit card, the company can also monitor details about the customer such as their age, address, gender, salary etc.. This technology has helped COMAG carry out extensive audience research, finding out what the readers of the magazines are like, and helps the publishers like Hearst UK target their magazines at their audiences in a more powerful way

How magazine companies TRY and retain their audiences

They choose the design and content of their magazines very carefully

· Attractive, bold front covers

· Free gifts such as chocolate, bags etc

· Special offers such as money off vouchers, or competitions

· Famous stars on the front cover and in the articles

· Familiar and consistent style to make the reader recognise them

· Offers reader the solution to their problems (Utopian Solutions)

· Gratifies their audience’s needs eg identification (Uses & Gratifications) For example as many of their readers seem to be suffering during the recession they create articles such as “Angry Generation” encouraging readers to feel like they are not alone.

· Makes the reader feel involved by using direct address, invites the reader to write in, email them, sign a petition. Makes them feel important.

· They regularly drop their price for one month only, especially at times of the year when their readers are likely to have less money (eg in January just after Christmas)

· They work with other companies to offer interesting online advertising opportunities (Institutional Convergence). For example, Muller Light sponsor a whole section of the Cosmo website which Hearst UK earns money from.

They use synergy (other forms of media) to attract attention to their magazine

· Interesting, interactive website to complement the magazine along with online advertising opportunities for advertisers who are no longer wanting to place ads in printed magazines.

· Product Placement in films and TV programmes. Eg Cosmopolitan features heavily in films such as Legally Blond and is often mentions in Friends.

· Branded TV channel to match the magazine. Cosmopolitan TV used to be available on cable TV but now is available online only. It features hundreds of behind the scenes videos about the making of that month’s magazine including interviews with the cover stars etc

· TV Commercials – Hearst has run several TV ads for Cosmo magazine, although none are currently being broadcast. Examples can be seen here

Facebook - site for Cosmo has over a million fans and although they focus on the US edition, they are still able to monitor comments and suggestions from fans all over the world.

http://www.facebook.com/#!/Cosmopolitan

There is also a game app called Cosmopolitan Me which allows users to create their own personalised Cosmo front cover using a photo of themselves on the front cover etc.. http://apps.facebook.com/covermeascosmopolit/?newlib=0&ref=ts&sc=0&news_id=0&page&new_question&historyKey&previousApp&randKey

· Twitter – The Cosmo UK Twitter Page has nearly 52,000 followers. They “tweet” roughly 20 times each day with short snippets of articles, or questions they want their followers to answer, and ALWAYS include a link which when clicked on, takes the user directly to the Cosmo website http://twitter.com/#!/CosmopolitanUK

· Text Messages – When users sign up to the Cosmo website they submit their mobile phone number. Every month when the magazine is released, users receive a reminder via text. They also used this when the magazine Sugar was still being published. Sugar’s readers were more “teens” of a school age and so the texts were sent at lunchtime to ensure their readers were on their lunchbreaks at school and could go and buy it!

· Emails - When users sign up to the Cosmo website they submit their email addresses. Every day / week / month users receive a Cosmo newsletter via email with links to their website and when the magazine is released, users receive a reminder to buy it via email as well.

· Mobile Phone Apps – Hearst has, in the past tried out several different mobile phone apps for the I-Phone for Cosmo, none have which have been very successful and have been systematically closed down. These included a “Sex Position of the Month” app, a “CosmoShop” app for buying Cosmo merchandise and a “Style & Beauty” app with Cosmo related material. There is now only ONE Cosmo UK app available which is a Celebrity Look-A-Like app where users can search for celebrity look-alikes and upload their own photos of lookalikes. These can then be viewed either on the app, or on the website http://www.cosmopolitan.co.uk/lookalikes

· I Pad Apps – Cosmo China and Cosmo Russia have successful I Pad Apps which are essentially a downloadable digital version of the magazine that readers pay for rather than purchasing the printed copy. Perhaps these are successful as people of that age in Russia and China are more likely to own an I-pad. One of Hearst UK’s successful men’s magazines Esquire has a successful I Pad version as well, perhaps because men are more likely to have gadgets like I Pads. Marie Claire (published by IPC) also has a successful I Pad App, perhaps because their readers have slightly more disposable income than readers of Cosmo and are maybe more likely to own an I Pad. Cosmo UK is yet to release an I Pad app or downloadable version of the magazine

· Chat Forums – Cosmo Chat is the chat forum on the Cosmo website. It has over 210,000 users and nearly 2 million individual posts have been made. The chat forum encourages readers to feel like part of a community

· Cross Promotion using Other Magazines / websites – Hearst regularly promotes Cosmo in its other magazines like Company and Men’s Health. This is FREE advertising for Cosmo. Likewise on the Cosmo website, they have a dating section allowing users to find men. These men sign up via the Men’s Health website and the Men’s Health logo is visible everywhere on this part of the Cosmo site offering MH free advertising. http://www.cosmopolitan.co.uk/dating/?cmpid=datingnav

· Horizontal Integration - Release spin off magazines to attract particular readers and encourage them to stay within the “Hearst” umbrella of magazines. For example Cosmo Bride and Cosmo Parenting aim to pick up readers who feel they are too old for the traditional Cosmo magazine. Cosmo On Campus is a free magazine which is distributed on university campuses and aimed specifically at students with articles focusing on student finance and budget friendly fashion.

· Flexible Video Screens – E-Ink / OLED are technologies which have been developed to make it possible for magazine pages to have video clips incorporated into printed paper pages. In 2008 Hearst International published a special edition of Esquire magazine in the US with an E-Ink front cover featuring a moving image to test the market. It was very popular but too expensive to produce on a regular basis

They develop and sell branded merchandise

· Make-Up – Cosmo have branded make up on sale on their website and in chemists such as Boots

· Cosmetic Tools – Cosmo have branded tools such as eyelash curlers, hairbrushes on sale in Boots and other chemists as well as on their website

· Clothes – Cosmo have branded pyjamas and dressing gowns

· Electrical Items – Cosmo have branded hairdryers and straighteners

· Sports Goods – Cosmo have branded exercise equipment

· Books – Cosmo have branded books, mostly relationship and sex guides

· Jewellery – Cosmo have a jewellery range

· All of these items can be purchased either in shops or on their dedicated website

http://www.cosmoshop.co.uk/?cid=shopnav

They sponsor events or hold events (especially for charities) that will guarantee publicity

· Cosmopolitan Blog Awards

· Cosmopolitan Fragrance Awards

· Cosmopolitan Rape Awareness Campaign

· Cosmopolitan Domestic Violence Campaign

· Cosmopolitan Angry Generation Campaign

Other things they do

· Release spin off or similar magazines (Horizontal Integration) to attract particular readers and encourage them to stay within the “Hearst” umbrella of magazines. For example Cosmo Bride and Cosmo Parenting aim to pick up readers who feel they are too old for the traditional Cosmo magazine. Cosmo On Campus is a free magazine which is distributed on university campuses and aimed specifically at students with articles focusing on student finance and budget friendly fashion.

· Shut down failing magazines to plough more money into their more successful brands. For example Hearst UK shut down Cosmo Girl and Sugar magazine as the teenage market was just not buying printed magazines any more. Instead they turned Sugar into an online only magazine (www.sugarscape.com)

· Market Research into their audience helps them know exactly who they are and what they want. Hearst UK co-own a company called COMAG which help them do this (see COMAG page of this booklet)

· Keep an eye on competitors and sometimes copy their decisions. For example Hearst realised how successful the travel sized magazine Glamour was for Conde Nast in 2001 and copied it by releasing a travel sized issue of Cosmo in 2004

· Employ mainly women to work on their women’s magazines as Hearst believe that it takes a woman to know what a woman wants.

· Hearst International specifically set up Hearst UK because they knew if they wanted to target a British audience they would need a British base, with British journalists, writers, designers etc.

· E-Ink / OLED – are technologies which have been developed to make it possible for magazine pages to have video clips incorporated into printed paper pages. In 2008 Hearst published a special edition of Esquire magazine with an E-Ink front cover featuring a moving image to test the market. It was very popular but too expensive to produce on a regular basis http://www.youtube.com/watch?v=9EWb1zHIx38

· Online Magazine only – Some magazine publishers are ONLY offering magazines online and are not bothering with a printed version

Digital Magazines – some people are suggesting that in the future, magazines will just have one hard backed copy with a computer chip inside that you can buy in the shop, and once purchased, if you have a Wifi connection it will update itself every day with new content. This could also be similar to the option of having a downloadable version of the magazine available on PC’s, Kindles, I Pads etc that updates itself each month if you pay the subscription. However market research has suggested that the price would have to come right down from the current £3.40 to make audiences interested in this idea

Why magazines are losing audiences and advertisers

SOCIAL NETWORKING, PARTICULARLY TWITTER - Audiences expectations have changed so that we now expect to receive our information and entertainment instantly rather than waiting a whole month for another issue. Magazines used to thrive by providing audiences with celebrity gossip such as celeb relationships, weddings, break ups and break downs. HOWEVER: With the advent of Twitter, we no longer have to wait a whole month between a celeb event happening, for the magazine to be written and printed, so we can find out about it.. Not only can we hear about it instantly online, but we can hear about it directly from the celeb themselves.

Why read a magazine to try and work out whether Demi Moor and Ashton Kutcher's marriage is on the rocks when on Twitter Ashton Kutcher uploads pics of Demi Moore in her underwear and you can see them immediately? You don’t even need to wait to watch the news to find out that American socialite Casey Johnson (pals with Paris Hilton and Lindsay Lohan) was found dead in her home, when her equally crazy celeb bisexual fiancé Tila Tequila puts her Twitter status as "My beautiful fiancé Casey is with the angels in heaven, miss you wifey!" This was before her death was even officially announced! Celebs are now able to connect directly to the audience without the magazine acting as a middle man and so audiences see magazines as out of date. Sometimes you can read Cosmo and there will be an interview with a celebrity about her and her boyfriend, when in actual fact they split up over 3 weeks ago because of the amount of time it takes to get the magazine onto the shelves (up to 3 months). Magazines can be out of date before they even get bought

TECHNOLOGICAL CONVERGENCE – Massive developments in technology over the last 10 years have meant that many technologies have “merged together” creating “technological convergence” where many gadgets can do multiple things. For example, a mobile phone now allows you to make calls, as well as take videos, upload footage, text people, read the newspaper, surf the net, play games etc. The consequence of this is that audiences now EXPECT to be able to access ANY information or entertainment on their phones rather than buy a newspaper, buy a game etc..Audiences want products (eg magazines) to be accessible on their phones, or on the internet, preferably for free. Here are a few clips to illustrate this change in the way we expect our media.

WEB 2.0 – Web 2.0 is a phrase that refers to internet based technologies that allow audiences to interact and contribute. For example Chat forums, Blogs, You Tube, Comment on articles etc. Audiences now EXPECT a certain level of interactivity that printed magazines just don’t offer

ADVERTISERS – Advertisers are very simply, following the audiences. If their audiences are spending most of their time online, then they prefer to place their ads online now. It is easier online to target your adverts at specific audiences as well, rather than ALL of the readers of Cosmo

Cosmopolitan - Audience and Advertisers

COSMOPOLITAN AUDIENCE

There are two types of audience for Cosmo Magazine (Readers and Advertisers)

Readers

Cosmo’s readers fall into the ABC1 Social Demographic. According to Hearst they are fashionable, fun, confident with key interests in shopping, beauty, and relationships. The main age group is 18-35 although the core readership is 20-25.

Cosmopolitan USED to be the biggest selling women’s monthly magazine available and would regularly sell 450,000 issues a month. However its circulation has been in decline constantly over the last 10 years and in 2011 it is only selling approximately 325,000 copies a month. Its sales fell 9% in 2010 and another 3% so far this year. It is now the 4^th best selling women’s monthly magazine (2^nd in terms of women’s fashion losing out on first place to Glamour).

The current cover price of an issue is £3.40. This means that Hearst UK earns approximately £1,105,000 a month from its readers buying the magazine.

Advertisers

Advertisers are the companies that pay to place adverts both in the printed version of Cosmo, and on the Cosmo website. Advertisers in Cosmo are generally companies that have the same target audience as Cosmo magazine. For example Muller Light Yoghurts, Gillete Venus Razors, Impulse Body Spray etc

Adverts can fall into a variety of categories including full page ads, double page ads, ½ and ¼ page ads, ads that feature free samples or tester strips, ads disguised to look like articles (advertorials) loose insert ads and there is even the opportunity for ads to be differentiated depending on the region of the country the magazine is going to be distributed to.

Costs for advertisers to place adverts vary immensely. The costs for full page ads vary from £18,000 to £25,000 depending on the part of the magazine the ad is placed in. As there are often up to 50 full page ads in an issue, Hearst can earn over £1,000,000 a month from full page ads in Cosmo alone!

According to the Guardian website, magazine advertising has fallen by 22% in the last 2 years alone and so magazine publishers like Hearst are desperate to keep advertisers placing ads with them.