Use this road map following Mequoda’s CAROTME framework to establish an economic strategy for your multiplatform magazine
Single-platform legacy media companies are widely out of favor with buyers and investors. That’s not just because they’re not currently “sexy” but because they tend to have lower rates of growth and profitability, and their future prospects tend to be similarly worse.
Given the economic leverage a fully integrated multiplatform magazine publishing operation brings to any media space, those are the kinds of companies that are drawing buyers, investors, and key talent. It is important to position your company for all your various stakeholders – investors, prospective buyers, and high-octane talent – and communicate your business road map in a way that makes them want to invest their time and money in your media business.
In an increasingly competitive landscape, top-dollar investors and the most sought after talent only want to be involved with companies that have a plan for the future. You should be able to create a brief but powerful business plan deck that allows you to communicate your vision to the stakeholders that your success so greatly depends on.
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And, the proof is in the multiples buyers are paying for media businesses. A legacy media business with moderate growth and profitability might get a valuation of six times earnings, and if those revenues are flat or declining the multiples can plummet to half that, or less — if they can even find a buyer. By contrast, we are aware of integrated, multiplatform publishers with growing revenues and growing profitability who have received valuations of eight, ten, or as high as 22 times earnings, reaching the level of hot software businesses.
If you own a media company, which scenario would you prefer? If you are a talented and ambitious employee, which do you think is going to be able to pay you more and offer better opportunities for growth?
A roadmap for maximizing your multiplatform magazine economics
So, the road map below for creating maximum economic value is the same business planning process we use with the organizations we admit into the Mequoda Business Planning Program.
You should develop your:
You’ll create content once and deploy it many times across both affinity and premium platforms to maximize audience development and revenue as well as cost-efficiency.
Tightly aligned, content marketing-based audience development efforts require detailed plans and schedules in order to execute them with efficiency and discipline.
While the old adage may be true that even the best battle plans don’t withstand the realities of war, a well designed plan and product strategy makes you better positioned when you encounter the realities of the marketplace whether your revenue comes from users, sponsors, or both.
Making sure all of the teams are in place, with the right team members isn’t a nice thing to have, it’s important for any business and essential to maximize the profitability of multiplatform media organizations.
For digital platforms the importance of the right technology, well implemented, is clear but it’s no less important for the legacy media parts of your business to both manage costs and most importantly facilitate data sharing to enable cross-marketing and upselling.
You get what you measure so to maximize your profitability it’s important your plans for what to measure and how to report it are completely (not partially or closely) aligned with goals and tactics of your business plan.
If you’re new to Mequoda, please take a moment to familiarize yourself with Green Gardens Network (GGN), our composite case study, and CEO Rose Harper, the embodiment of all our clients whose “example” we use as a teaching tool without revealing real publishers’ names or data. For now, suffice to say that GGN started as a print gardening magazine generating about 80% of its revenue from subscriptions and 20% from advertising. For Rose Harper, the value of her company rises dramatically as she executes these various strategies, as both her earnings, and the multiples the market will pay, grow. And, while Rose is the fictitious CEO in our composite case study, her story could become your story of multiplatform success.
Want to make this happen for your organization? You have the manual on how to create your road map. And, we’d be happy to talk with you about the Mequoda Business Planning Program and whether it’s a good fit for your organization. Please contact us to set up a free consultation.