Mequoda Magazine Study PDF

Nicholas, Mateus
2016 MEQUODA
AMERICAN MAGAZINE
READER STUDY &
HANDBOOK
Multiplatform Magazine
Reader Habits and
Digital Publishing
Best Practices
Copyright 2016 Mequoda Group LLC
Report Authors:
Don Nicholas
Kim Mateus
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Table of Contents
Introduction & Key Findings from Digital Magazine Market Study..4

More than 40% of US Adults Read Digital Magazines ........5
More than 2/3 of US Adults Actively Read Print Magazines...6
Americans Have Increased Digital Magazine Spending by 52.7%......................7
Digital Magazine Readers Demand Readable, Scrollable Text......8
59% of Magazine Readers Say Digital Edition is Most Important...9
Multiplatform Consumers Older and More Affluent than Digital Only.10
Multiplatform Consumers Spend More..11
Men More Likely to Prefer Digital and Multiplatform, Women Print.12
Digital Only Consumers Getting Older and Wealthier...13
Multiplatform Consumers Up 32%..................................................................................14
Respondents Demographic Data....15

Introduction to Digital Magazine Best Practices.....16
Magazine Archetypes & Definitions............17
What Is a Digital Replica? ......22
What Is a Replica Plus? ......26
What Is a Reflow Plus? ......29
What is Vertical Reflow? ........32
Launching a Digital Magazine.....34
Designing Your Digital Magazine........40
Pricing Your Digital Magazine....45
Calculating Digital Magazine Costs.....51
Publishing Your Digital Magazine.......55
Selling Digital Magazine Subscriptions........59
Conclusion........62
Mequoda Executive Team Bios....63

Introduction to Study & Key Findings
In 2014, Mequoda ran its first ever digital magazine market study, polling US adults with
Internet access. At the time, the biggest finding was that 20% of our sample size of 1,136
people reported currently reading or subscribing to digital magazines on their tablets.
In 2015, we conducted another study and more than tripled our sample size from 1,136 to
3,642 US adults with Internet access. We asked the digital magazine usage question a little
differently and learned that 1/3 of US adults reporting having read a digital magazine issue in
the last 30 days.
For our third consecutive magazine study in 2016 we polled a total of 3,241 US adults with
Internet access. We asked many of the same questions we did in 2015, plus a few new ones
and in particular, we set out to further analyze the multiplatform consumer, those who
report reading both digital magazines and print magazines in the last 30 days.
As the industry evolves each year, so does our study. We set out to learn as much as we can
about digital magazine consumers each year, to discover how consumption, preferences and
spending habits are growing and evolving.
Our Methodology and Key Findings from 2016
41.46% of the 3,241 surveyed reported having read an average of 2.59 digital
magazine issues in the last 30 days. Compared to 2015, this represents a:
7.68% increase in issues read
12.69% increase in penetration
1.01% increase in adults with Internet access
13.83% increase in adults reading digital magazines
We also inquired about their print magazine consumption. We found that:
69.76% of US adults reported having read an average of 2.84 print magazine

issues in the last 30 days. This represents a 2% drop in print magazine issues
read.
United States Census Bureau QuickFacts, http://quickfacts.census.gov/qfd/states/00000.html - 245,201,076

persons 18+ in 2014.
Pew Research Center Internet Science & Tech, http://www.pewinternet.org/2015/06/26/americans-internet-
access-2000-2015/ - as of January 2015, 84% of American adults use the Internet.
More than 40% of US Adults
Read Digital Magazines
In thinking about the last 30 days,
how many DIGITAL magazine issues have you read?
Digital magazine consumption grew in 2016. In 2015 36.79% of US adults reporting reading
an average of 2.74 digital issues and in 2016, that number went to 41.46% of US adults
reading an average of 2.59 digital issues.
This represents a 7.68% increase in issues read, a 12.69% increase in penetration, a 1.01%
increase in adults with Internet access and a 13.83% increase in adults reading digital
magazines.

More than 2/3 of US Adults Actively
Read Print Magazines
In thinking about the last 30 days, how many

PRINT magazine issues have you read?
In addition to quantifying the readership of digital magazines, we wanted to understand what

percent of the American adult population with Internet access reads print magazines and
how that compared to last year. We also wanted to learn how many print magazines, on
average, they are consuming in a 30-day period.
While the percent of people reading print in 2015 and 2016 remained flat at 69.73% in 2015
and 69.76% in 2016, the number of average issues read in 30 days fell from 2.94 issues to
2.84 issues. This represents a 2% drop in issues read.

Americans Have Increased Digital
Magazine Spending by 52.7%
During the last 12 months, how much have you SPENT
on digital magazine subscriptions and single copies?
The next thing we wanted to discover was how digital magazine spending had evolved in the
last year.
In 2015 15.10% of US adults reported spending a total of $1.27 billion per year on digital
magazine subscriptions and single copies. In 2016, that number grew to 23.51% and $1.94
billion.
This is a 52.7% increase in digital magazine spending year over year.

Digital Magazine Readers Demand
Readable, Scrollable Text
In thinking about digital magazine FUNCTIONALITY,
how important are each of the following to you?
For the last two years, digital magazine consumers have shown a dramatic preference for
text that is readable and scrollable, two features inherent in native editions and responsive
web editions, and scant or unavailable in antiquated digital magazine versions like digital
replicas or PDF style editions.

59% of Magazine Readers Say Their
Digital Edition is Most Important
Of the following 6 magazine EDITIONS, which do you find most IMPORTANT to you?
The data above shows that a shift has happened, where more than 50% of US adults believe
their digital edition is the most important. The web edition alone is slightly below the print
edition, but digital editions in total consume 59.28% of the total when it comes to
importance.

Multiplatform Consumers Older and
More Affluent than Digital Only
Consumers
$90,000 60
2016 Demographics
$80,000
50
$70,000
$60,000 40
$50,000
avg Income
30
avg Age
$40,000
$30,000 20
$20,000
10
$10,000
$0 0
Multiplatform Consumers Digital Only Consumers Print Only Consumers Non-Readers
In 2016 we set out to understand how the demographics of a multiplatform consumer (one
who reported consuming both print and digital magazines) differed from digital only readers
and print only readers.
We learned that multiplatform consumers had a higher household income than their print
only and digital only counterparts, while non-readers had the lowest household income.
Multiplatform consumers were also older than their digital only peers.

Multiplatform Consumers Spend
More
80%
Digital Mag Spending
70%
60% 2016 Multiplatform

Consumers
50%
2015 Multiplatform
Consumers
40%
2016 Digital Only
30% Consumers
2015 Digital Only
20%
Consumers
10%
0%
$0 $1-30 $31-60 $61-100 $101-200 $200+
We found that multiplatform consumers are 1.67 times more likely to spend $100 per year
on digital magazines than digital only consumers.
Multiplatform consumers are also 1.64 times more likely to spend at least $1 per year on
digital magazines than digital only consumers.

Men More Likely to Prefer Digital and
Multiplatform, Women More Likely to
Prefer Print
70%
female
60% male
No Response
50%
40%
30%
20%
10%
0%
2016 2016 Digital Only 2016 Print Only 2016 Non-
Multiplatform Consumers Consumers Readers
Consumers
In 2016, multiplatform and digital-only consumers were 1.09 times more likely to be male,
while print only consumers were 1.76 times more likely to be female

Digital Only Consumers Getting
Older and Wealthier
The average age of the digital-only consumer increased from 34 years old in 2015 to 41 years
old in 2016, representing a 20% increase in age.
Average household income for digital-only consumers increased from $68K in 2015 to $79K
in 2016, a 15% increase in income.

Multiplatform Consumers Up 32%
Multiplatform consumers increased from 60M in 2015 to 79.3M in 2016, a 32% increase.

U.S. Respondent Demographic Data
Gender
Male 46%
Female 54%
Age
< 18 0%
18-29 22%
30-44 27%
45-60 25%
> 60 26%
Household Income
$0 - $24,999 16%
$25,000 - $49,999 16%
$50,000 - $99,999 28%
$100,000 - $149,999 16%
$150,000+ - 24%
Device Type
iOS Device 21%

Android Device 17%
Other Device 0%
Windows Desktop 51%
MacOS Desktop/Laptop 9%
Other 2%

Introduction to
Digital Magazine Best Practices
It is our hope that the digital magazine
stats revealed in our study this year shed
light on the habits and preferences of
American magazine readers. In the pages
to come, youll find a collection of best
practice articles and tips to put you on a
path to creating a multiplatform
magazine strategy that enlightens your
readers and helps your publishing
company grow and profit.
Well define the various digital edition

types that exist, along with their pros and
cons and will provide niche and mass
media examples for you to analyze. Well
also provide tips for creating the most
coveted digital magazine editions and will give you a step-by-step process for launching a
digital magazine, including a Strategic Planning Framework.
Finally well get into some dos and donts on designing, pricing, producing and selling your
digital magazines.

Magazine Archetypes and Definitions
Every Publisher Should Know
Do you run a magazine publishing company or work for a magazine publisher?
Most Mequoda publishers, and those who read the Mequoda Daily blog, would consider
themselves to be in the magazine publishing industry.
But do you think of yourself as running a native magazine, or a digital magazine, or a digital
magazine app, a print magazine or a magazine website?
You might have said yes to two or three of those, or you might think they mean similar
things. To us, they have different meanings and different business models. Lets define each.
Print Magazine
This magazine archetype goes without much explanation its the traditional magazine
business model. It will share many of the same features as other types of magazines, but this
one is made of paper. You can flip the pages with your fingers and youll breathe in that
freshly printed ink smell as you read it. Although non-print magazines have grown in
popularity, when we ask people why they prefer one platform to the other, the ones that
choose print say its because they like holding a magazine in their hands, and many even
mention the smell. Magazines are certainly nostalgic.
Digital Magazine App

Although a digital magazine could rightly refer to any magazine read digitally, most would
agree that a digital magazine is a digital edition. In other words, this is the magazine that you
read on your iPad, Kindle or other tablet-like device. It can still be held in your hands, but it
cant be paged through in the traditional sense. The digital in digital magazine also refers
to the type of content offered. For example, ads may link to webpages (a great advantage to
advertisers), and articles may include videos. We break the digital magazine app down further
into three platforms:
Apple edition
Kindle edition
Google edition
The most popular digital magazines, in order of least interactive to most interactive
are: digital replica, replica-plus and reflow-plus. A digital replica is typically a PDF of your
magazine that has been formatted for a tablet reader, whereas a replica-plus offers much
more interactivity (the videos and ads previously mentioned.) Magazine publishers who
create a reflow-plus tend to add new functionality to the magazine that makes it act uniquely
from any other digital magazine, and more like an app. More on these variations later.
Digital-Only Magazine App
A subset of the digital magazine app is the business model that does not include a print
version at all. This is what some struggling publishers have started exploring, most notably
Newsweek although there are many others, both B2C and B2B. Of course, this model is also
what may have lead to Newsweek being able to afford getting back into print, two years later.
Golf Digest is another that went digital-only. Chairman Jerry Tarde explained, Its a response
to the times and peoples reading habits, and the changing nature of the 24-hour news cycle.
The notion of a print magazine that lands a week after the action the perspective is really
good, but its much better if it can be delivered immediately. Thats what our readers
expectations are.
Native Web Magazine
Native web editions are read online, via a browser. They arent formatted for a tablet and
they cant be bought in an app store. They are available through a magazine subscription
website, where the user can view an issue of a magazineone that is linear and periodic, has
pages and a regular frequency, and can be viewed in HTML on any desktop or mobile device
at any time. Theres nothing to download. Publishers of native magazines usually generate
their revenue through subscribers and may also take ads.

Web Archive or Library
Typically, when youve digitized your magazine into a native magazine, this makes it
remarkably simple to create a native magazine archive or library. This is available through
your magazine subscription website just like the original web magazine. Users have access to
old articles up until whatever date you choose. The web magazine archive is an added value
to your magazine subscription and users can access the archived content by issue date or by
topic and can be viewed on any device.
More Definitions Youll Encounter in this Book
In addition to the magazine archetypes above, there are a few industry terms youll run into
in this book. Terminology is changing constantly, as it always does with new technology and
new products, but for now we should at least attempt to clarify a few things. Some of these
definitions come from outside Mequoda, but others are our own preferred definitions that
serve to clarify some of the confusion in the industry. Your mileage may vary!
Digital magazine
The Alliance for Audited Media (formerly ABC) defines a digital edition as distribution of a
magazines content via electronic means. The digital edition must maintain the same identity
of the host publication by maintaining the same brand characteristics. Mequoda agrees with
this definition.
Replica
At Mequoda, we consider a replica edition to be one thats fairly simple, with print content
digitized on pages exactly as the print edition does it. The user swipes right to left in order to
read left to right, and the pages are exactly as they appear in the print version, only
downsized to fit on a tablet screen. More on this coming up.
Replica-plus
We cant find anyone using this term on the Internet the way we use it. For us, a replica-plus
magazine is a simple replica, with the pages squeezed into the tablet screen, but with
additional content, such as hyperlinks, videos, tappable photo galleries and other technology
not available to a print publication. Its also sometimes called a non-
replica or interactive edition. More on this coming up.

Reflow
A Mequoda Best Practice, reflowing your magazine so that the pages and type arent
downsized and unreadable makes your magazine much more reader-friendly. In this version,
the page is redesigned to fit the screen without shrinking the type. Additionally, it can be
designed so that the page fits horizontally, but not vertically. The user swipes up to scroll
through what is essentially one very long page.
Reflow-plus
This is the most advanced version of a digital magazine currently available. Now the
publisher is adding the interactive bells and whistles to a nicely reflowed magazine. This
gives you everything that readers are looking for in digital magazines. More on this coming up.
Magazine app
For the publishing industry, Mequoda considers a magazine app or just app to be the
program that allows users to access their digital editions on a mobile device. Readers
download the app from a digital newsstand.
More creative apps, such as those of New York and Forbes, offer free content of some kind
thats updated every day, in order to keep readers coming back for more. Others at least
include a free issue or free sample content, in addition to selling subscriptions.
Gadget app
At Mequoda we use this term to distinguish certain kinds of apps from the ones that most
publishers are familiar with the app that sells the magazine and to avoid confusion. A
gadget app doesnt sell the magazine, but it provides some other function thats related to
the magazines content. For instance, Farm Progress has an app called Growing Degree
Days for use on smartphones, which measures the maturity of your crop by viewing
current and past growing degree days data for your farms location.
Another example would be Martha Stewarts Marthas Everyday Food: Fresh & Easy
Recipes.

Tablet
When writers refer to tablets, theyre often talking about mobile computers such as iPads
and all competitors such as the Kindle Fire, products from Microsoft and Samsung, and the
Google Nexus. Others only consider tablets to be the iPad and similar larger devices that
have multiple functions, while the smaller Kindle and Nook devices are referred to as e-
readers, being largely limited to reading functions.
Magazine website
A magazine subscription website archetype is set up to build subscriptions for a related print
or digital magazine and to provide access to issues of the magazine online, often in an
HTML format. It requires registration for full access to the site; content is offered online;
and is organized by issue and by topic.
A magazine website is only a magazine website if the user can view or download an issue of
a native magazine, can be viewed in HTML, downloaded as a PDF or downloaded to a
mobile device.
Many people refer to any website that carries a legacy magazine brand and magazine content
as a magazine subscription website; however, if the content is not organized in a magazine
format and issues cannot be viewed or downloaded, it doesnt meet our basic criteria of
being a magazine subscription website. It is, instead, a periodical subscription website.

What is a Digital Replica?
A replica edition is fairly simple, with print content digitized on pages exactly as the print
edition does it. Usually this means simply uploading PDFs of your pages into software of
some kind, or having someone else do it for you. The layout, advertising and content are
exactly the same as the print version, no more or less, and each page, accessed by swiping
horizontally, is identical to the print original.
(Note: If you currently create your magazine pages as PNGs, please resist the temptation to
upload those. The iPads technology makes those pages look fuzzy and pixelated. And thats
definitely a no-no.)
Producing a digital replica is a fairly simple process now, with dozens of providers offering
software and even hosting, marketing and analytics services.
And if youre concerned that youll look like a publishing dinosaur by putting out a simple
replica, the answer is it depends on your audience. These days, many perfectly respectable
publishers are opting for the replica because of the lower price points for design (none) and
production. Publishers in the business-to-business arena, or consumer publishers with older
subscribers may even prefer this version of a digital magazine, bells and whistles free.
Digital replica: The cons
Obviously the biggest downside to creating a digital replica of your magazine is that its an
entirely new expense, requiring more manpower and technology that you never needed
before the iPad came along. More on the actual costs later.

In addition, many publishers find their sales team has trouble selling advertising now that its
so much more complicated in the digital world. The metrics are complex and not
standardized, and explaining the benefits to a new advertiser may take more knowledge than
your print ad salespeople have.
From the consumer point of view, one of the biggest complaints we hear about replicas is
the page, being simply minimized to fit into a tablet screen, delivers type thats too small for
many people to read. Enlarging the view then expands the page beyond the confines of the
tablet screen, so the reader has to move the page around with a finger to read all of it.
In the study you just read, digital magazine readers cited readable text as one of the most
important features, one that a digital replica does not provide.
Another problem no one seems to be measuring is that a replica edition, if done sloppily,
can generate animosity and drive consumers away from your brand even long-time readers.
In Apples app store, we see dozens of complaints about the technology of every app.
An example from a large news publication, which should have the money to do these things
right:
(1 star)
No longer interested
I have not been able to download the last three issues, even though they
appear on the library shelf, and I have downloaded the upgrade. This is a
waste of time, and I am going to write my subscription off.
We guess that subscriber wont be renewing any time soon.
Digital replica: The pros
So why should you trust your brand to a digital replica? Most importantly, because
consumers expect and even demand a mobile version of your magazine. The longer
publishers wait to jump on the bandwagon, the more they risk losing their audience to rivals
who already have a mobile version.
On top of that, consumers are starting to actually prefer digital magazines to print, partly
because of the convenience and, especially in the case of millennials, partly because of the

green factor. Last year, a full 52% of respondents to our study said digital medias lighter
environmental impact was the main reason they subscribe to digital magazines.
And while our consumer research is showing that the small type on a replica can be a pain
for readers, there is an alternative to the basic replica that we call the vertical swipe reflow,
(more on that later) which allows a larger font size as each article is then reflowed into a long
single page thats accessed by swiping vertically.
This is something most publishers could choose at a minimal expense Mequoda, for
instance, charges clients $50 per page to redesign a magazine to reflow to overcome the
replica con of small type.
Besides, consumers are increasingly willing to spend serious cash on mobile media, unlike
expectations of website content back in the early Internet days when everyone demanded
that all content be free.
You certainly want to be getting in on that action, even with a plain replica!
So is it worth your time and expense to publish a replica?
While youre weighing the above pros and cons, youll also need to consider cost.
The best thing about the replica is that uploading PDFs is pretty much all there is to it: No
need to redesign around fancy options like interactive ads, videos, or interactive content. If
you want to move beyond the simple replica, most providers will happily do it for you, but
lets consider the basics of producing a plain replica.
When it comes to providers in this space, Adobes Digital Publishing Suite (DPS) is the
granddaddy of them all. However, getting into DPS Enterprise requires an upfront cost of
more than $50,000, and a significant cost per download. This makes DPS best suited for
large, multi-title publishers.
The provider we recommend for niche publishers is Mag+. For Mag+, youre going to pay a
fraction of the cost per month to publish to all devices, and just a few pennies per download.
(And unlike Adobe, Mag+ allows publishers to host their digital magazines themselves,
eliminating the download cost.) This package is much friendlier to smaller publishers.
How much should you charge?

Pricing for digital magazines is as chaotic right now as your average Macys sale. No two
pricing policies are alike! However, weve determined that the average single-copy price is
$4.97, while the average 1-year subscription rate is $19.97. Some folks bundle their digital
subscriptions with print for an extra $5-$10. Others maintain completely separate
subscription options.
If youre feeling bold you can bundle your digital subscription with your print subscription,
and take that opportunity to raise your print price. Of course, the real question in pricing is
how youre going to break even and make money after investing in your digital edition.
But heres the bottom line based on Mequodas research so far:
To launch a simple replica, you may pay about $8400 per year for Mag+, plus another
$2000-$3000 in labor.
If you have a $30 subscription, with the average 70% remit, youll need to sell 550
subscriptions to break even. And even the smallest of publishers weve heard from are selling that
number, even as many as 10,000 or more in their first year. If thats not enough to get you on the
digital bandwagon, we dont know what is.

Whats a Replica-Plus
Digital Magazine?
A replica-plus is a replica with some extra bells and whistles added. And normally youd
think that adding things such as video, audio, HTML links and other technology-rich
features would be an improvement to the simple replica. Were not so sure that its a good
enough upgrade, and heres why.
The problem with adding bells and whistles to a simple replica to create a replica-plus lies in
one of the disadvantages of the replica that weve just discussed. But first, lets look at the
pros and cons of the replica plus.
Replica-plus digital magazine: Pros
The advantages of the replica-plus are similar to the replica, in that consumers increasingly
expect digital versions of their favorite magazines, either because of convenience or because
of the green factor. Whats more, consumers are also becoming more willing than ever to
pay for digital content, though there is still some hesitation about prices that are higher than
print.
Also like the replica, a replica-plus edition is easier and cheaper to produce than fancier
versions. This makes it a good starting point for any publishers who are late getting to the
digital party because of a lack of resources.

Finally, replica-plus editions create an even more audience-engaging environment for
advertisers than the simple replica, with all those interactive features. Finally, renewal rates
are gradually showing themselves to be higher for mobile editions.
Replica-plus digital magazine: Cons
You may recall that the major drawback with a replica-plus is the small type necessary to
shrink a print page down to tablet size. You can pinch out to enlarge the type, but then the
page no longer fits in a tablet screen.
This is more than just an inconvenience; its a major source of complaint for many
consumers weve talked to. And it makes your app magazine largely inaccessible to anyone
over the age of 40.
So heres why we believe the replica-plus is not enough of an improvement over a basic
replica: It doesnt solve the type size problem. It just increases the users frustration by
creating more things he or she cant see. And when youre in enlarged mode with part of
each page missing, you probably overlook the links and tappable buttons that lead to the
videos, audio and other fancy features anyway.
In short, the replica-plus is akin to adding fancy whipped cream, chocolate syrup and
cherries to a bowl of sand. It may look nice but it costs more to create and does little to
make the sand more appealing.
A visual difference
In one replica-plus digital edition we know, theres a sharing function called streaming,
which is just a fancy name for social media sharing. You can tap an article title in the TOC
(but not on the cover) to go directly to that article. You tap and hold to find all the available
links on a page. Oh, and theres a smooth interface that takes you to the website from
which we never did figure out how to escape. Rather maddening, that. And above all you
still have to squint to see the replica content.
This is what we could call an eye exam.
If you want to improve your basic digital replica, we do not advise going with the next step
that so many publishers seem to believe is logical, the replica plus.

Instead, invest your money in a reflow. Your lovely, user-friendly mobile magazine is going
to increase revenues, after all, and it wont be long before you can afford to add the bells and
whistles you long for. More on that next.

Whats a Reflow-Plus
Digital Magazine?
Instead of dressing up a plain replica with whipped cream, for most magazines Mequoda
advocates for something we call a reflow version (coming up next). The reflow allows the
type to resize and reflow around ads and images in order to fit on a tablet screen while still
being readable. Nothing shrinks. Your 40-something readers are happy.
You might wonder how we skipped from replica plus to reflow plus, without considering the
reflow by itself. Thats because we havent found anyone doing just a reflowed version of a
magazine. Everyone whos invested the time and money into reflowing their publication
seems to have also added the bells and whistles that make their magazines pluses.
A reflowed magazine has been designed so the text and images are enlarged but still fit onto
a mobile device screen horizontally, instead of forcing a magazine page-full of content onto
the smaller screen by shrinking everything, as the replica does. Content that doesnt fit on
one page is simply flowed onto the next.
This means the reflowed version is vastly superior to a simple replica where a magazine
page-full of content is shrunk down enough to fit as one page on a mobile device screen,
especially to folks whose eyes arent quite what they used to be.
And there are two ways to reflow your content: Keep it flowing horizontally so the reader
simply reads your entire magazine horizontally from newly flowed page to newly flowed
page as she would a print magazine.

Then theres the vertical reflow, also known as vertical swipe. In this version, the content in
each article, if it doesnt fit on one page, flows downward, and is accessed by swiping up.
The reader swipes horizontally to navigate from article to article, and vertically to read
articles longer than one tablet-sized page. Note that when you reach the bottom of a
vertically swiped page, you dont have to scroll back to the top to swipe horizontally to the
next article. That can be done from anywhere within the long vertical page. Magic!
Reflow-plus: Pros
As weve been saying all along, having an app version of your magazine is a basic advantage,
given the light-speed adoption of mobile devices by the reading public. And the reflow-plus
is superior to both a simple replica and to the replica-plus. The most obvious benefit is, of
course, readability. Increasing access to your content is always a good idea.
And were definitely not fans of the replica-plus. Why spend your money on extras when
readers have to squint to see them?
A reflow is an excellent use of the technology digital natives seems to want in digital
products. Users accustomed to digital media become impatient with low-tech PDF replicas.
Finally, the plus part of Mequodas name for this version tells you that the magazine uses
technology to enhance the reading experience with video, additional popup content, audio
and more. That means more engaged readers, happier advertisers and a more profitable
magazine.
Reflow-plus: Cons
Yes, a reflow-plus costs more than a simple replica. We cant share provider prices with you
because theyre usually negotiated with a sales rep, but Mequoda partner Mag+ says that on
average it takes about 10 minutes per page to reflow the content five minutes for a short
piece such as a letter from the editor, and a few hours for an eight-page feature.
And Mag+ tells us many of their customers who start out with the simple replica move to
custom design, including reflow, after only a few issues.
The only other disadvantage we can come up with for the reflow is potential confusion for
readers of vertical reflow magazines but thats easily remedied by explaining how it works
in your users guide (which of course you have, because its a Mequoda Best Practice) and by

including visual cues or icons, such as arrows, in vertical articles to tell readers how to find
the rest of the content.
Its not hard to see why the reflow and reflow-plus is Mequodas Best Practice. We certainly
believe its worth the extra cost if you can swing it, and certainly a better way to spend your
money than tacking fancy features onto a simple replica.

Whats a Vertical Reflow?
Isnt it fascinating to consider how the old journalism phrase above the fold has evolved?
Once it literally meant above the fold of a traditional broadsheet newspaper. Editors,
writers and designers battled over what, and who, would win a coveted spot above that fold,
where the most reader eyeballs would land.
Now, even as those broadsheets themselves are in decline, heading for dinosaur status, the
phrase still lives in tablet and web publishing.
Of course tablets have no fold. But they do have a single screen, and for magazines
employing the Mequoda Best Practice of vertical reflow, above the fold that is, the first
screen has become once again a layout consideration.
Vertical reflow, also known as vertical swipe to describe how the user accesses the content,
means a layout where instead of squeezing a magazine page into the smaller tablet screen,
the content is resized and reflowed on a bottomless tablet page. Users swipe up to bring up
this long page as they read. The reader can swipe horizontally at any point on this page to go
to the next article.
Mequoda prefers this layout because its reader-friendly; even young folks can have trouble
reading content thats squeezed down from magazine size to tablet size if you dont reflow
your content.
And the growing popularity of this layout has led to new design considerations what
should you put on that first screen, above the fold?

Designing above the fold for a tablet
When you employ vertical reflow, you dont have to worry about responsive design, because
the contents already laid out to be easily viewed on that tablet screen.
And just as in the newspaper days when editors chose content to go above the fold that
would keep their readers engaged and coming back every day, tabley content designers have
to consider how to do the same. You dont want your subscribers or single-issue buyers
yawning and scrolling straight through your magazine.
Those readers wont be renewing, or buying a subscription, if theyre not captivated by your
content in the first few seconds on each page. And its certainly a waste of resources if youre
spending time and money to reflow your content without taking reader engagement into
consideration.

Launching a Digital Magazine
At Mequoda, we urge our clients to begin the process of launching a digital publication
yesterday, because we firmly believe that the future of our industry lies in mobile publishing.
Over the next several chapters, were going to walk through everything you need to know in
order to launch a digital magazine. To begin, well outline these five steps here, and as you
read on, well explain more about the finer details of each.
Step One: Decide on a format
The very first thing a budding digital publisher must do is decide on the format of the
magazine. Will the magazine be a simple replica? A replica-plus? You might also choose to
reflow your print content for maximum readability. That means redesigning each page in a
vertical format, so that long articles flow into bottomless pages and the reader swipes
vertically to access the content.
Youll also include as many live hyperlinks as possible for additional resources both the
links included in your print product and new ones that youve added just for the digital
product. Consumers tell us that theyre all about extra information and content that they
cant get in the print product. If you just upload PDFs of your print pages, youre not taking
advantage of the technology why bother?

Step Two: Add interactive elements
Adding interactive elements to your digital magazine is essential. And the thing consumers
love most about tablets is video. This may sound daunting, but dont assume this is out of
your reach. Existing DVD or downloadable video content can be repurposed. You can start
producing video content of your own, or at least dip your toes in the water by reaching out
to bloggers and others in your niche who might have videos theyd be willing to share with
you.
One of our clients began just that way, and soon found that demand outpaced the supply of
existing video content. That gave them the motivation and confidence in the market to start
creating their own videos.
In addition to video, you could at least deliver photo galleries of images that didnt make it
into the print product, or behind-the-scenes shots or similar material.
Finally, you should be prepared to have at least one bonus article, with interactive elements,
in every digital issue to enhance value.
Step Three: Create a subscription website
Two words: Subscription website. If you dont have one, create one. Mequoda clients use
our comprehensive subscription management program called Haven Gate to launch a
premium subscription website as part of their product lineup.
There are a number of advantages to having a subscription website related to your print and
digital magazines. First, it helps you develop a relationship with your readers and keeps them
engaged with your brand. And since you have other products to sell (you do, dont you?) it
gives you the perfect platform to do just that.
Having a magazine subscription website associated with your print or digital products also
allows you to sell subscriptions and back issues yourself, instead of relying on Apple and
other newsstands which in turn means you get to keep the cut youd have to give those
third parties.
You also control your subscription offers, including copy, price and incentive testing, not to
mention offer tracking and data harvesting.

Above all, having that premium subscription website means you can bundle your products
website, digital and print in a way that drives the average sale price from $20 closer to $30.
And who among us would sneeze at an increase of 30-40% in per-customer revenue?
Whats more, because the average customer stays with you for about three years, youll be
getting $90 from that customer instead of $60 over that lifetime.
We write about the advantages of operating a premium subscription website all the time, so
lets revisit our Biblical Archaeology Society (BAS) case study in Step Four.
Step Four: Develop a pricing strategy
Choose your pricing strategy. Take this example from BAS to heart:
Biblical Archaeology Review digital at $19.95

BAS digital library on the premium subscription website at $29.95
BAR digital + BAS library at $34.95
More than half of BAS sales are for the highest priced product $15 more than the lowest
priced product. The second highest sale price point is the middle price. Few consumers
bother with the cheapest product!
Step Five: Integrate your marketing
Determine your marketing strategy. This means establishing a schedule to integrate digital
magazine promotions into daily, weekend and spotlight emails that you send out to email
subscribers from your website portal.
You should plan to promote your digital product once every six weeks or so. We have plenty
of advice for using email to market your products, in case youre unsure.
That wasnt so bad, was it? Mequoda has already worked out the process, so you dont have
to start from scratch.
The Mequoda Multiplatform Magazine Strategic Planning Framework (SPF)
In planning to launch a digital magazine or a digital edition of your magazine, there are many
factors to consider. Thats why weve created a strategic planning framework (SPF) as a tool
to help you develop and communicate your business plan within your multiplatform
publishing organization.
You may find there are additional factors specific to your publication or operation, but these
will provide a basic data set for your planning and modeling.
Strategic Planning Framework:

Multiplatform Magazines
Frequency
How many issues per year? #
Editions
Print
Web (HTML)
App
o Apple
o Amazon
o Google
o Other
App Editions
Software licensing cost $

App set up and submission management cost $
Asset creation cost $
# Issues uploaded at launch
Production Price/Page $
Cost per Issue Download $
Print Issue Map
Copies printed #
Editorial pages #
Ad pages #
Index pages #
Other #
Digital Issue Map
Editorial pages #
Ad pages #
Index pages #
Other #
Advertising
Available inventory (pages) / year

Fill rate %
Rate Base #
Average Yield / thousand subscribers $
Yield per page $
Pricing
Edition Pricing % of Distribution

App(s)
Print
Web
Combo
Weighted average price
Library of back issues content structure
By back issue Yes No

By topic Yes No
Email
# of email subs
# of emails sent
Orders per 1,000 emails sent
Website
Web page views

Orders per 1,000 page views
App Order Index
% of App Orders Remit Rates

Apple
Amazon
Google
Other
- Must total 100%
Continuity revenues (typical rates)
Conversions (45%)
o App
o Print
o Web
o Combo
Renewals (65%)
o App
o Print
o Web
o Combo

Designing Your Digital Magazine
Now that were all clear what digital magazines are, lets take a look at some of Mequodas
favorite features in the magazine apps and digital magazines themselves that weve noticed.
Given how rapidly the industry is changing, some of these may eventually evolve into
something else or disappear completely, but its still worth considering these features when
youre creating or rebuilding your own apps and magazines.
Best Practice #1: Updated daily content in your app
Besides the fact that many users dislike free magazine apps that deliver nothing more than
the opportunity to buy the magazine, an app with no there there gives users no reason to
remember it, or the magazine, unless they want to buy a new single copy.
Magazines like New York deliver a full-scale daily news product inside their app where the
magazine is also easily accessible that any user would love to check every day. Publishers
have been delivering free content on their websites for years now, giving them daily
opportunities to make new sales, so why not put some in your app?
Even if you dont have a vast news staff like New Yorks, you could post your daily blog or
other content youre already producing into your app, and include lots of ways for users to
subscribe or buy single copies. Its an opportunity for publishers to reach out to users who
wouldnt dream of sitting at their desk to read content on a website.

Best Practice #2: Let em save their favorites
Print readers are accustomed to the ability to save something they really like by cutting it out.
So they tend to miss that ability in digital editions, at least according to reviewers weve
noticed in various magazine apps at the newsstand. So its a nice touch when you can add a
feature such as Forbes clipping tool and The Atlantics folder feature. If you can get your
readers to save and, better yet, share your content, youve opened up an entirely new
marketing channel.
Best Practice #3: Add value for advertisers
There are many ways you can make yourself a must-have for your advertisers, some of the
more obvious being to allow links to the advertisers website directly from ads, or from
products featured in articles. Black Belt magazine has one you dont see everywhere,
though: An interactive directory of ads, including a search function.
Imagine telling your potential advertisers that readers will always be able to return directly to
an ad that they first noticed while reading your magazine or look for a product they
already knew they wanted and find it easily.
What would that be worth to advertisers who think that digital advertising is only for game
apps?
Best Practice #4: PDFs, not PNGs
Its hard to believe in this advanced digital era, but some publications are still delivering
blurry text and grainy images. Thats because theyre still exporting their magazine pages as
PNG images, which look highly pixelated when viewed with the latest iPads display
technology. Your magazine may take longer to load, but nothing will turn off your readers
faster than a grainy-looking product, even when grainy Instagram photos are in vogue. Get
with the 21st century, pronto.
Best Practice #5: Two orientations
Again, this one should be a no-brainer. Readers consistently say they want the option to view
magazines in both landscape and portrait mode. It costs more to design, but if you can
manage it, it will probably pay off in the long run.
Best Practice #6: Zoom zoom

This is yet another feature that seems like a no-brainer, but is not always available. Please let
your readers increase the size of your wonderful content and images! Not everyone is 20
years old with perfect vision, and you certainly dont want to risk readers never returning to
your magazine because you went 20th century on them.
What About Free Digital Magazine Apps?
As the first wave of digital magazine apps has passed, weve discovered one thing: People
hate apps with nothing in them.
And yet, the vast majority of digital magazine apps available today are nothing more than a
retail outlet for single copies and subscriptions.
They are labeled as free, but have nothing to offer unless a purchase is made within the app.
This practice is the reason why so many magazine apps have low ratings, as can be witnessed
by reading the reviews.
While we have opinions on magazine pricing (coming up), and the dire need to raise them, at
the same time, magazine readers are like many other digital consumers in
expecting something free on their tablets. And disappointing them right out of the gate when
they first download your app is not exactly a marketing best practice.
In case you hadnt noticed, your competition and peers are starting to solve this problem. So
it behooves publishers to rethink their app strategy immediately, if not sooner! But fear not,
we have some solutions to the app customer service nightmare, courtesy of some very savvy
publishers.
The magalog
Cond Nast, as weve mentioned before, is on the leading edge in digital magazine
publishing. So its no surprise that they developed an app for SELF (Motto: Tap into your best
self!) that combines free content enhanced with videos and extra tappable content, with
sell copy urging you to subscribe now.
If that sounds vaguely familiar, its because its a lot like the magalog of old a carefully
crafted blend of free content and marketing messages. SELF does it with a back issue from
2011. On a page titled Lets Get Physical, featuring two exercises that are illustrated with video,
SELF proclaims, Buy it now! Get the new issue of SELF and let us be your personal
trainer!
There are variations of this message on every page, from beauty to fashion to healthy eating.
One quibble: You cant get to the Subscribe page by tapping on these messages. You have
to know enough about apps to tap on the Home icon. One of them includes instructions, at
least; Go to the home screen of this app to buy the newest issue! Youll find tons of easy
ways to eat better today.
All in all, a clever approach that combines the best of free content with marketing. Watching
someone actually do an exercise is roughly 2,376 times more useful than looking at a static
image, and that tempted even an old marketing hand like me to hurry up and subscribe.
The free issue
Interestingly, the publisher who perfected the magalog in the olden days, Consumer
Reports, doesnt do an app magalog. Instead, it delivers free issues. This is the most
common style of content-rich apps, and you can choose to offer either a free back issue, or a
special issue youve put together for this purpose.
Many publishers dont include a date on the free issues. So in Consumer Reportss free issue,
reader has no idea which model year is being reviewed, and that goes for the tablet reviews,
the washer and dryer reviews, and everything else in the free issue.
As marketers, we love it. You get the full flavor of Consumer Reports rich content, yet
nothing is really being given away who would choose a car based on data that could be
years old, and then decide they already got what they wanted and exit the app without
subscribing?
Whats more, at the end of every article is a full-page ad featuring an image of an iPad with a
cover related to the content of that article the Best Tablets, Cameras, TV, Phones, E-
readers and More issue after the tablet review, the annual auto issue after the car review,
and so on. The text is the same on every ad: Enjoying your free preview issue? Subscribe today and
save up to 59% off the single-issue price.
Updated free content
Instead of just offering a free issue, you can really step up your game like New
York magazine. This is the most entertaining, awesome digital magazine app out there. We
kid you not.

New York has broken new ground. With this free app, you get daily content including news,
features and columns. Pages and pages of free, new content. You could easily spend an hour
or more reading it.
Then, when youre done, and youre thoroughly dazzled, you simply tap on the magazine
link at the bottom left, and you get the table of contents and the opportunity to buy.
If youre already a subscriber, you still enjoy the free content, and when youre ready to read
your issue, its only a seamless swipe away. Finally, for the pice de resistance, theres a link on
the Latest News page the home page for the free content to the website.
New Yorks free news content and paid magazine content are both easily accessible at all
times with their unique window shade feature just pull the handle with a finger. And
then theres the thumbnail menu of the magazines pages at the bottom when youre in that
part of the app. There are just so many ways to love this app, we cant list them all.
Everything New York magazine does is readily available, free or for a price, seamlessly
connected, and easy to navigate. Clearly you need a fairly large staff of journalists to make
this kind of daily content happen for free, but the app is a home run.

Pricing Your Digital Magazine
Magazine pricing strategy has certainly evolved over the past couple of years. As recently as
2013, we still believed that universal pricing was the best way to handle print, website and
tablet products. Today, weve evolved our own thinking and our new Best Practice is decoy
pricing or contrast pricing, which requires different prices for different products.
Universal pricing: Universal Digital Access, as a policy, creates an environment where

subscribers can safely sample different platforms without fear of being left behind. From the
publishers point of view, a subscriber is a horrible thing to waste, and anyone who
subscribes to content on any platform, in any edition, is given premium access to their
subscription website.
Contrast/decoy pricing: Contrast pricing takes advantage of the psychological

phenomenon in which human beings, when asked to make a choice, tend to rely on the
relative value of things compared and contrasted to other similar things. Bundle that digital
magazine with at least one other product, and make sure you have three offers to drive more
buyers to the highest price point.
Interestingly, an article in PCWorld published just weeks before the iPads debut in 2010
speculated that publishers would continue their traditional pricing models of $10 to $20 per
year and I hope thats the model iPad magazines go with, added the writer. Of course
you would. Youve been getting thick, glossy, content-rich magazines for pennies since the
beginning of time. Why would you want to pay more?

One of our biggest pet peeves is the decades-long policy that magazine publishers pursued
to maintain rate base pricing their publications dirt-cheap. $9.99 was indeed a common
price for 12 full issues of a consumer magazine.
That policy trained generations of consumers to believe that magazines are cheap,
throwaway products. This seems to have been restricted to the U.S. When we taught our
Digital Publishing Course in London to global publishers several years ago, eyebrows in the
room rose collectively to the ceiling when we mentioned the prices of some well-known
American magazines. They were astonished that any industry would shoot itself in the foot
in that way.
Our angst over this issue made us practically float out of our chairs with happiness at the
MPA Swipe 2.0 conference where Hearst Executive Vice President John Loughlin declared
war on cheap magazine pricing now that digital editions or as we call them at Mequoda,
app editions are so popular.
What did Loughlin think is a fair price? 19.99 is the start of fair value, he said, adding that
nearly 900,000 Hearst subscribers have already agreed with him. Loughlin isnt shy about his
position: He also sounded this theme when talking to the Wall Street Journal. I hope that this
is the demise of $6 and $7 and $8 and $9 print subscriptions, he said at the time.
It was a great sound bite, but Hearst still charges $8-10 for most of its print products, and
$12 for most of its tablet editions sold, for reasons were unaware of but which we hope
they tested in six-month increments of $6. The company has also recently entered the
ranks of decoy pricing publishers, and again, we hope they test this! Subscribers can get both
print and tablet editions in an annual bundle for $13, just $1 more than the app edition.
Thus Cosmopolitan, for example, offers these packages in a decoy pricing arrangement:
Print: $12
Tablet: $12
Print + tablet: $13
Yes, our models tell us that theyll probably drive more sales for the $13 option and will also
generate more sales overall. But the increase in revenue is minimal, compared to other
bundle prices.
The $1 increase from print or tablet to the combo package certainly delivers what we call the
no-choice choice, which is a polite way of saying no brainer. But our research shows
that a $5 increase delivers the same impact, and you get more money!
As the model shows, our testing says you can still get more orders and more buyers for the
highest-priced offer, even when its $5 more than the next price. But as always, test your own
offers to find out what works best for your audience.
Meanwhile, as we pointed out above our client, the Biblical Archaeology Society, happily
allows us to use their data to point out the benefits of Mequodas Best Practice bundle
pricing:
$19.95: Biblical Archaeology Review app magazine

$29.95: The Biblical Archaeology Society digital library (BAR archives plus 20 years
worth of Bible Review and eight years of Archaeology Odyssey)
$34.95: BAR app edition + BAS library
When BAR launched this pricing structure in 2013, BAS earned $97,000 from the combo
offer, the most expensive option. Everything else combined totaled $58,678: $38,322 less
than sales from the combo offer all by itself.
As well see in a moment, that kind of success is not pursued by larger publishers.
Meanwhile, another trend showing up among those big players is illustrated by The New
Yorker: the three-month offer. The theory behind this strategy is that it lowers resistance to
buying by making the commitment smaller. And in the digital era, the costs to renew four
times a year rather than once are minimal, so its worth testing.

App magazine publishing as camouflage
As the WSJ noted, Hearst was joined in this campaign by publishers such as Bonnier, owner
of Popular Science and Field & Stream, and by Cond Nast, publisher of Vogue and The New
Yorker. In fact, The New Yorker has not only raised its prices, it did so in a somewhat
surreptitious way by simply attaching a $20 higher price to the magazine, print or app, when
it launched its app edition in 2011.
Thus the old $39.99 price for print rose to $59.99, and the tablet edition was priced at
$69.99. Nowhere did The New Yorker actually announce a price increase, thus completely
camouflaging that extra $20 behind the dazzling debut of its app.
However, The New Yorker has stepped backward with its current offer, which is one price for
all three offers print, app, or the combo package. In essence, this is still universal pricing.
Not only that, but those $59.99 and $69.99 prices are gone at $12 for 12 weeks, as we
noted above, the new annual price is $48.
The Economist also joined in this sleight-of-hand. When they abandoned universal pricing in
2012, they took the opportunity to bump the price from $127 to $160 for the bundle, while
leaving the $127 price in place for app-only or print-only. Those prices are still in place
today.
What makes app magazine publishing worth more?
Higher prices for both print and app magazines are being accepted by the consumer, and its
encouraging that consumers are willing to pay more for an app product that, from the
outside, looks much less expensive than print to produce. But are app magazines really
worth more than the old print magazines? At Mequoda, we really do believe that higher
prices for app subscriptions are about more than just correcting decades of underpricing.
App magazines, as Hearsts Loughlin points out, offer extra value, including instant delivery,
enhanced and extra content, and interactivity, not to mention being easily archive-able and
searchable without taking up space.
It also appears to be important that app magazines are green.
Then theres the data starting to trickle in showing that tablet owners hit two of marketings
most desirable demographics: Theyre young, and theyre affluent. Its not often you can get
both of those demographics in one product. This two-fer means that the target audience for

app subscriptions is more willing to spend money because they have more to spend and on
top of that, they havent been trained to think that print magazines are birdcage liners.
How often do you get a win-win situation like that? Oh by the way Cond Nast has data
showing that its tablet subscribers are renewing their subscriptions at a higher rate than
print-only subscribers and theyre also paying higher prices for their renewal subscriptions.
By my count, were now up to a win-win-win.
Walking the walk
So if Hearst isnt following its own advice, Cond Nast has lowered its app price, and The
Economist is at least holding its price ground, whats really going on around the industry?
Weve done some price studies and the bottom line was that magazine pricing is as varied as
snowflakes, even inside one publishing company.
Some publishers charge more for print than tablets, and some do the opposite. Most dont
offer bundles, but at least the three who do make an effort to maximize their pricing policy.
Two of them, National Geographic and Maxim, offer a $5 no-choice choice leap to the
bundle.
Rare is Loughlins fair value price of $19.99. Meredith is stubbornly sticking to its rock-
bottom print price of $5.99. Perhaps thats one of the unspoken reasons for the death of
Ladies Home Journal, which ceased publication.
The only bundle was National Geographic. Hearst, despite its bundle offered for Cosmopolitan,
offers no bundle for its two largest magazines, and is only slightly more ambitious with its
largest magazines than Meredith is, with a print price of $7.99.
Bonniers Working Mother costs the same for print and tablet, as does Maxim.
GQ, inexplicably, doesnt offer a separate tablet subscription at all. Their app is available only
as a bundle with print.
Some of these publishers have actually begun raising their prices, which observers believe is
part of a trend in the industry. Well all get to see if thats true the next time we update this
study!
Finally, we went to the magazines which presumably are doing everything right, because
theyre the top 10 in tablet circulation improvement. But theres no magic answer here for
those of us studying the best pricing practices prices are once again all over the place, and
wed guess that the reason these publications are doing so well with tablet circulation is
because of the on-the-go nature of their readers, not because theyve carefully thought out
their pricing policies.
The top nine offered no bundles. Some at least have healthy prices for print no $5.99
prices here. Most price print higher than tablets, but Rider and Natural Health price their two
editions the same. And Outside goes with universal pricing.
It would appear that theres no one answer for optimal pricing policies among these
successful publishers. But at Mequoda were still sticking with our belief in fair value of print
magazines and in our Best Practice of decoy or contrast pricing.
These practices succeed for our niche publishing clients like the Biblical Archaeology
Society. Theyre content to drive ever-higher revenues for themselves and quietly succeed
inside their specific niches with Mequodas pricing policies.

Calculating Digital Magazine Costs
Theres no doubt that publishing your digital magazine on a tablet, so that it can be
downloaded in some of the worlds largest newsstands, is a good idea. 20% of your
subscriptions will come directly from this huge marketplace.
It benefits your content too. Many people read from back to front in print magazines. But in
a digital magazine, 95% will read front to back. Theyll see more pages (and ads for that
matter). Or, theyll pick an article are start there. With a native magazine the reading
dynamics are similar but different. Its a fascinating thing to master if youre a magazine
editor in the 21st century. The native magazine is significantly different, and both are very
different from the print magazine.
Newsstand remit rate costs
Just a few short years ago, magazine publishers were thrilled down to their toes to keep 18-
40% of sales from news agencies.
When Don ran an online newsstand, 18% was the average new remit order for the 1,400
titles there. And some publishers earned absolutely nothing from sales from the agencies
they dealt with.
But all these years later, the same publishers complain bitterly about earning 70% of sales
from Apple.
Some people just dont know when theyve got it good. The cost of digital newsstand
publishing (or app store, in the case of Apple) is pretty fair.
If you plan to launch a reflow-plus digital magazinethe type of edition we suggest because its most
desired and readableyoure going to incur more costs than if you launch a digital replica. Of
course, the cost of using the top digital newsstands is technically free. Apple, Amazon and
Google dont charge you to publish your magazines.
The cost is incurred on those platforms are 30% to Apple on the app store, 35% to Amazon
and 40% to Google on their newsstands whenever you sell a copy or subscription. Amazon
and Googles rates are negotiable.
A lot of folks in the industry consider Apple to be taking a 30% commission, and that number
is the focus of their ire. Yet, as weve noted, Apple is actually sending publishers 70% of
every sale. No publisher pays any newsstand or app store a 30% commission. So we prefer
to call it a 70% remit rate to describe the action that occurs when Apple sends your cut to
you.
Which digital newsstand or app store should you use? Two of the ones below will negotiate
their remit rates. For these, were reporting on the best remit rates weve seen around the
industry.
Apple App Store
Remit rate: 70%

Negotiable: No
Device: iPad
Notes: Apple allows publishers to sell subscriptions on their own websites, even if Apple is
also selling those subscriptions, and takes no cut as long as the website contains content,
and isnt a rival commercial website.
Amazon Newsstand
Remit rate: 65%

Negotiable: Yes
Device: Kindle
Google Play Newsstand
Remit rate: 60%

Negotiable: Yes

Device: Android smartphones & tablets, Google TV
Zinio
Remit rate: 85%/35%

Negotiable: Yes
Device: All major ones
Notes: Zinio, the oldest digital newsstand operation, handles all conversions to digital format
for publishers. It also has the most complicated arrangements, and will even handle
fulfillment for publishers who want to sell their digital magazines from their own website. It
has the best remit rate if you sell your magazine through your own site (85%) but drops to
35% when sold through their platform.
Zinio also launched its Netflix-style program, Z-Pass, which costs $5 per month for six
magazines, which the user can swap out as desired.
Design and publication costs
Of course, there are other costs involved, including design and publication. In terms of
design, you may need:
A new hire - If you decide to hire a new designer specifically for your digital issues.
Magazine software - If your existing designers are ready and willing (more on that
below).
A partner - You may choose to outsource everything to a company (like Mequoda)
that does it all for you, usually for a per-page rate.
Software costs
One thing most publishers will need, if they intend to publish on the big platforms, is digital
magazine publishing software. When perusing digital publishing software rates, you may
come across these fees:
Initial software fee the charge to use their software

Startup fees typically from companies who help you set up / design your digital
magazine
Per download fee the flat rate or percent you pay per sale
Per published magazine the flat rate or percent you pay every time a new issue
comes out
Monthly fees a flat rate you pay monthly to use the software / service
Hosting fees the cost to host your files
The next chapter will focus on several different software options you can choose.
We dont normally advise publishing a digital replica, however many publishers with smaller
budgets, or those who havent decided to invest in their digital magazine yet, choose to start
with a digital replica.
In this case, the production costs above would be less, because youre not truly digitizing the
content. A temporary thing, we hope.

Publishing Your Digital Magazine
Publishers have been trying digital magazine publishing software during the last few years in
hopes of creating the best digital products for their audiences. And like everything else in
digital magazine land, digital magazine software has evolved at light speed. And so has its
pricing.
Major digital magazine publishing software options
Adobe Digital Publishing Suite: The Adobe Publishing Suite is one digital magazine
publishing software option that offers a complete digital publishing solution. It allows users
to publish for print, web, and tablets seamlessly. As the company notes, the tools for
creating your app are free to use if you already have InDesign CS6 or later, and you only sign
a license with them when youre ready to actually publish.
However, DPS is aimed at multi-title publishers. A Professional license allows the very
smallest publishers to publish one title only. If you want additional platforms, the license
cost goes up to $6,000 a year. Theres also a fee of $.35 per download.
This is a switch from earlier pricing which allowed multiple titles in the Pro option.
Adobe now encourages publishers with three or more titles to move up to its pricey
Enterprise option, which is priced individually for each customer. We look at the overall
organization, how much they might be saving in print costs, and other business
considerations before we can tell you what the costs will be, a senior Adobe rep told
OmniStudio. While once you could actually get an Enterprise license for a mere $50,000 up
front, Enterprise prices can now be in five figures per month. And few niche publishers can
afford that for digital magazine publishing software.
And since at Mequoda, were all about the little guy, we have a partnership with
Mag+: A spinout company derived from Bonnier Corp.s very early Popular Science app,
Mag+ is our go-to provider. We generally direct our niche clients their way.
We find that Mag+s digital magazine publishing software feature set and functionality are
similar to Adobe, and also support our best practices such as content reflow and including
HTML links and other interactive features. But Mag+ is simply more affordable for small
publishers, both the base price and the entitlement price for downloading issues to clients
subscribers.
The cost is $8,388 per year ($699 per month) for enterprise features most publishers need,
including adding a login to your app to gate your content. It allows you to publish one title
to all devices, (multiple issues), similar to the DPS price, but with Mag+ you get 1 terabyte of
downloads per month included, more than enough data for 99% of apps.
Unlike Adobe, who charges a fixed fee per download and files must be hosted with Adobe,
Mag+ allows publishers including our clients who use Haven Gate, our comprehensive
premium subscription management module to host their digital magazines themselves. So
you dont even have to pay that entitlement cost.
This also allows you to eliminate the app store and newsstand middleman and keep the cut
youd normally owe them for each issue sold. Another benefit: You also control your own
subscription offers, including copy, price and incentive testing, not to mention offer tracking
and data harvesting.
Another benefit of Mag+, in our experience, is that the culture there is more compatible
with ours as champions of the independent publisher. Their executive team is open and
honest, and very willing to answer questions and work with small publishers. At Adobe, not
surprisingly, youll find a closed culture where youre routed to resellers who often know less
than you do about digital magazine publishing, and little if any support comes from Adobe
itself.
Frankly, we still expect that Mag+ will eventually pass Adobe and take over the #1 slot,
because there are simply more independent small titles than there are companies like Hearst,
Meredith and Time Inc.

Other digital magazine software options to consider
ZinioPro: Youre probably very familiar with Zinio, and although theyve historically part of
a somewhat closed magazine ecosystem, weve included them because they have a new
offering called ZinioPro, which extracts XML from print issues and allows the content to be
reused in responsive apps, on the web, and in social channels. Zinio is also working hard at
increasing their arsenal of distribution partners, making magazines available from online
retailers and in some app stores and newsstands.
YUDU: This company offers digital magazine publishing software in a full range. You can
start with simple PDF uploads and turn them into browser-based editions and apps. YUDU
has a vast range of impressive names on its client list, so it must be doing something right.
The first thing we noticed, though, was that its the only digital magazine publishing software
company we checked out that follows our own Best Practice of offering a free white paper
in exchange for an email address. Well done!
YUDU offers an option for a web-based magazine with excellent performance on all
devices via PageTiler technology. This is a browser-based newsstand, allowing consumers
to flip through pages of a magazine without installing an app.
GTxcel: Texterity and Godengo merged to create this digital magazine publishing software
company which provides not just app publishing, but websites as well. With the Unified
Publishing Platform, you create the content and Godengo translates it for every platform
you need. Clearly this is more costly than just paying a company for the tools to publish an
app, but its one-and-done approach might be a good fit if you havent gone digital yet
because youre reluctant to hire a staff to do it.
BlueToad: Similar to GTxcels offerings, BlueToad provides digital magazine publishing

software for digital editions and mobile apps. BlueToad takes PDFs and turns them into
viewable formats online. We have some clients small niche publishers, naturally who
jumped into digital publishing before Mag+ arrived and found BlueToad fit their needs
satisfactorily. Another of their customers says,
They have been essential in developing our digital audience, by allowing us to focus strictly
on content, while they focus on delivering our content platform independently. Since we
first began using digital editions and apps with BlueToad - reader page views have grown
ten-fold. Ten-fold is a very good thing!

PressPad: The pricing model on PressPad is tempting; its free to publish enhanced versions
of your PDF magazine, and PressPad keeps the first $299 your app earns each month. They
claim to have produced 3% of all the magazines in the newsstand. One feature of particular
note: PressPad automatically generates a free sample issue of your magazine when you
upload an issue (or you can choose to create your own). A free sample issue is one of
Mequodas app magazine best practices, but far too many publishers ignore it.
Issuu: You can test the digital waters for free with this company. Issuu provides a digital
reader to embed on your website that allows readers to access a simple version of your
magazine. Issuu makes its money by selling advertising on the readers, or from the small fee
($312-$420 a year, depending on extra features you want) you can opt to pay to get an ad-
free reader. All magazines on Issuu are free, but some publishers have found a work-around
that allows them to sell subscriptions.
Mequoda has its own solution, too, partnering with Mag+. Weve already helped several
Gold Members develop what we believe are the first-ever responsive native magazines,
delivering a full, page-by-page, rich-media experience in a web browser, making it accessible
on any device.
As the magazine and newsletter industries continue down the path of digital evolution, new
product solutions will continue to reach the market.

Selling Digital Magazine
Subscriptions
Its amazing to look back to when digital magazines were still something of a novelty. Today,
its a given that print publishers will soon create a digital version of their product if they
havent already.
In fact, publishing entrepreneurs who have launched from scratch with print, digital and
website simultaneously, and even established websites with no magazine at all are beginning
to create their own magazines multiplatform publishing run backward, so to speak.
But even as they become part of the norm, everyone is still trying to figure out how to sell
digital magazines in this brave new world of ours. Sometimes the newest and hottest ideas
are just that ideas. Were focused on strategies that have actually been executed and
demonstrated to work.
So here are 8 strategies weve compiled for selling digital magazines.
1. Track device users: If youre making even the smallest effort at online audience
development, youre getting a sizable number of unique visitors to your website. You should
always identify those visitors who arrive on a mobile device, and deliver a floater with a
digital subscription offer they cant refuse.
2. Keep the whole pie: At Mequoda we always build a subscription website as a companion
to our clients magazines. Beside the obvious benefits of audience development, subscription
websites are vital in selling digital magazines, because you can sell directly from your website.

Take the money yourself, send them to Apple for fulfillment, and you dont owe Apple a
dime. Why? Because Apples primary interest is selling iPads, and as long as your
subscription website isnt a competitor retail site, the company is happy. Bonus: You get to
gather the customers data, which Apple doesnt willingly share and is a sore point for many
publishers.
3. Leverage your back issues: Theres gold in them thar archives! One of the product
bundles offered by Scientific American includes print, digital and the incredible archive
that SA fully digitized a whopping 150,000 articles, dating back to the magazines first
issue in August 1845 and including contributors such as Albert Einstein and Thomas
Edison.
And while few publishers have an archive as old and rich as SAs, most legacy publishers
have older content that their subscribers would love to access.
4. Sell on Apple: Having discussed selling digital magazines on your own subscription
website, we certainly dont mean to imply that you should bypass Apple altogether. Its by
far the best deal youll ever get in an app store or agency, brick-and-mortar or virtual: Every
sale Apple makes for you means 70% of that price in your pocket.
Remember, in the old days, the average remit from a newsstand for your print sales was 18-
40%. And this is beside the fact that Apple is one of the most beloved brands of all time,
resides on the best-selling tablet of all, and has far more magazines available, making it the
most widely-shopped digital newsstand available to you.
5. Get noticed: While its unclear anymore how much influence smaller niche publishers can
have on getting themselves featured on mighty Apple, theres still hope for standing out on
other newsstands. Google Play, for instance, enhances its customer experience by providing
free content supplied by publishers.
It might not be Apple in scale, and for that reason you might make this lower priority, but
Google Play continues to grow, perhaps because of the lower cost of Android devices. Its
revenue growth, though below Apples, is tracking similarly to Apple up.
6. Sample issue: Some publishers give away sample issues in their app to entice customers
to buy something. Self offers an actual archive issue; Consumer Reports offers what looks like
an old issue, but could be an issue compiled specifically for the purpose. A case study noted
that for Popular Science, when they tested a specifically designed sample issue against a free
trial, the sample issue, showing off the best of the digital edition, easily bested the free trial
offer. (Dont hesitate to run your own similar test, though. Free trials are classic marketing
techniques for a reason!)
7. Low-tech paper: Theres no excuse not to market to your existing print subscribers.
Include a special offer for them when you have to send a renewal or billing notice anyway,
and the cost is minimal.
8. Promote them: This may seem like a no-brainer, but its shocking to us how many
publishers (and were talking big players) have elaborate websites hosting subscription pages
to build print circulation but their digital products go unmentioned. On the platform
where theyre most likely to find their tech-savvy readers! For heck sake, sell your digital
magazine on your website! Dont hide your digital editions under a barrel!

Conclusion
While things continue to evolve, the overall trend is clear. Multiplatform publishing,
including native tablet editions and responsive web editions, is the future of magazine
publishing. Whether your revenue comes primarily from selling subscriptions to premium
content or selling advertising and sponsorships, there are substantial and growing revenue
streams to be developed. And one thing you can be certain of, if you dont offer a
compelling multiplatform media experience for your markets, your competitors will.

Executive Team Bios
Don Nicholas, Founder, Chairman & Strategy Group Leader
Don Nicholas is Founder & Chairman of Mequoda Systems. As our Chief Systems Advisor,
he supervises the planning, development and optimization of all Mequoda Multiplatform
Media Management Systems. Don serves as an executive coach for Mequodas Service
Teams and the high octane management teams at our Gold Member Client organizations.
Over the past two decades, Don and his teams have guided the transformation of hundreds
of legacy media brands into highly successful multiplatform media brands. Don has authored
numerous books on media and technology including Multiplatform Publishing Strategy. Don
is the lead instructor for Mequoda Events, and a frequent moderator and speaker at media
industry events. He is also the founder of Blue Dolphin Direct, MagazineWeek and
Lighthouse Publishing Services. He is a graduate of the Naval Nuclear Power Training
Command, Sacramento State University and Capella University where he studied
engineering, journalism and management. Don is an avid sailor, historian and novelist who
loves to travel with family and friends.
Kim Mateus, EVP & Planning Group Leader
Kim Mateus is Mequodas Executive Vice President & Planning Group Leader. In 2016, she
will guide a select group of legacy media organizations through our Business Transformation
Planning Program. She leads our planning, research, and communications teams and
manages Mequodas events and workshops. Shes a frequent speaker at industry events and
proudly serves on the board of the Specialized Information Publishers Association. She
earned her degree in journalism at Roger Williams University and enjoys travel, cooking and
time spent with family and friends.
Bill Dugan, Senior Vice President & Chief Strategy Advisor
Bill Dugan is Mequodas Senior Vice President and Chief Strategy Advisor for Belvoir Media
Group, Cabot Heritage Corporation, The Dark Intelligence Group, Forester Media
Network, GiANT Impact, Investing News Network, Metro Parent Publishing Group,
National Association of Plan Advisors, Prime Publishing, Sovereign Media, The Successful
Investor, and Vida y Salud Media Group. Bill partners with the executive management teams
of these organizations to develop strategic multiplatform publishing plans, oversee
implementation of publishing business plans, and help clients grow revenue, profits, and
influence. Bill has served as Publisher and Group Publisher for twelve B2B paid-circulation
newsletters at Georgetown Publishing House, Briefings Publishing Group, and The Pohly
Company. And as Director of Marketing for Nutrition Action Healthletter, Bill helped grow
that consumer publication into the largest paid-circulation health newsletter in the world. Bill
is an active member of the Specialized Information Publishers Association (SIPA) and serves
on the board of directors of SIPAs Foundation. Bill is also an avid baseball fan and enjoys
American history, family history and genealogy, and cooking.
Luis Hernandez, Senior Vice President & Chief Strategy Advisor
Luis Hernandez is Mequodas Senior Vice President and Chief Strategy Advisor for B the
Change Media, Biblical Archaeology Society, Center for Science in the Public Interest,
Countryside Publications, Ebner Publishing International, Loss Prevention Magazine,
Natural Health Advisory Institute, Program on Negotiation at Harvard Law School and
Yankee Publishing. He guides the CEOs of these organizations and their respective
management teams through the process of growing and monetizing their multiplatform
audience. As the Director of Publishing at Thompson Publishing Group, Luis started as a
reporter and went on to direct and oversee the editorial, marketing and production efforts
for the $15 million publishing company. Luis teaches courses in content strategy,
sponsorship development and organizational management at Mequoda Events. Previously,
he was the Executive Director of the Specialized Information Publishers Association. Luis
holds a BA in Journalism from St. Marys University in San Antonio, Texas where he was
born and raised and has an MA in English from Georgetown University. Luis resides in
Washington, DC with his wife and two daughters.
Aimee Graeber, Executive Vice President & Technology Group Leader
Aimee Graeber is Mequodas EVP & Technology Group Leader. She is the architect of the
Haven Nexus System and manages all system consulting, design, development, maintenance,
training and support for clients. She sets and oversees the implementation of Mequoda Best
Practices for all hosted systems. Aimee and her team also work with Mequoda Gold Member
Clients to set and oversee the implementation of Mequoda System Best Practices for all
systems hosted in the Haven Nexus Data Center. Aimee also works with clients who build
and manage their own systems, advising them in how to maximize their existing
environments.
Laura Pittman, President & Analytics Group Leader
Laura Pittman, Mequodas President and Analytics Group Leader is responsible for
modeling, budgeting, reporting and analyzing data for Gold Member Clients. She works
directly with Gold Members to help them understand the impact of the Mequoda System on
their media businesses. This year, Laura and her team will create and deliver more than 20
in-depth proxy metric models for Mequodas Strategic Planning Services clients. Laura is
formally trained as an accountant, and is an expert in computer modeling, reporting and
business analysis. She is a specialist in project management, fulfillment system reporting and
direct marketing.

For more free white papers and handbooks on
multiplatform publishing, digital magazines, audience
development, and subscription websites, visit:
http://www.MequodaFree.com


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American Magazine Reader Study & Handbook Page 2 of 65

Introduction & Key Findings from Digital Magazine Market Study..4

Respondents Demographic Data....15

American Magazine Reader Study & Handbook Page 3 of 65

Our Methodology and Key Findings from 2016

We also inquired about their print magazine consumption. We found that:

69.76% of US adults reported having read an average of 2.84 print magazine

United States Census Bureau QuickFacts, http://quickfacts.census.gov/qfd/states/00000.html - 245,201,076

American Magazine Reader Study & Handbook Page 5 of 65

In thinking about the last 30 days, how many

In addition to quantifying the readership of digital magazines, we wanted to understand what

American Magazine Reader Study & Handbook Page 6 of 65

This is a 52.7% increase in digital magazine spending year over year.

American Magazine Reader Study & Handbook Page 7 of 65

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American Magazine Reader Study & Handbook Page 9 of 65

American Magazine Reader Study & Handbook Page 10 of 65

60% 2016 Multiplatform

American Magazine Reader Study & Handbook Page 11 of 65

American Magazine Reader Study & Handbook Page 12 of 65

American Magazine Reader Study & Handbook Page 13 of 65

American Magazine Reader Study & Handbook Page 14 of 65

iOS Device 21%

American Magazine Reader Study & Handbook Page 15 of 65

Well define the various digital edition

American Magazine Reader Study & Handbook Page 16 of 65

Do you run a magazine publishing company or work for a magazine publisher?

Digital Magazine App

American Magazine Reader Study & Handbook Page 17 of 65

Digital-Only Magazine App

Native Web Magazine

American Magazine Reader Study & Handbook Page 18 of 65

More Definitions Youll Encounter in this Book

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American Magazine Reader Study & Handbook Page 21 of 65

Digital replica: The cons

American Magazine Reader Study & Handbook Page 22 of 65

We guess that subscriber wont be renewing any time soon.

Digital replica: The pros

American Magazine Reader Study & Handbook Page 23 of 65

So is it worth your time and expense to publish a replica?

How much should you charge?

American Magazine Reader Study & Handbook Page 24 of 65

But heres the bottom line based on Mequodas research so far:

American Magazine Reader Study & Handbook Page 25 of 65

Replica-plus digital magazine: Pros

American Magazine Reader Study & Handbook Page 26 of 65

Replica-plus digital magazine: Cons

This is what we could call an eye exam.

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American Magazine Reader Study & Handbook Page 33 of 65

Step One: Decide on a format

American Magazine Reader Study & Handbook Page 34 of 65

Step Three: Create a subscription website