Chemistry Journalism
by mitch on May 12 2009 (3160 Views)
Recently, Chemical and Engineering News had to cut 16% of their staff due to decreasing ad revenue.[CS] Advertisers have been trending towards less spending, but this is often attributed to a lower subscription base. The number of C&EN's subscribers do not fluctuate enough to account for this type of lost revenue, so what is causing the decrease?
After the layoffs there are now 48 C&EN's staffers. If I assume the average salary is ~$5,000 per month, I have no clue if this is valid but it seems like a lower limit dollar value, then C&EN needs to make $240,000 per month to just cover payroll. Our dues pay for their paper, printing, and distribution costs. So let's compare C&EN's revenue model to Chemistry Blog. First we need to define some terms.
- Uniques, defined as the number of unique people that read a website/magazine in a given week.
- Revenue per unique per month. Average amount of revenue generated per unique reader in a month
With a weekly subscription volume of ~140,000, C&EN has a monthly unique volume of 560,000. Which means C&EN needs to make a minimum revenue per unique of $0.43 per month to cover my lower estimate of their payroll costs. On the other end of the spectrum, Chemistry Blog generated $15.00 in April from 20,000 uniques, this translates to ~$0.0008 of revenue per unique per month. The gist of this story is uniques are cheap online.
We at Chemistry Blog fully admit that C&EN is a better news source, better journalism, and a better target audience for advertisers. But from a purely marketing angle, Chemistry Blog is cheap at a cost of one fifth of one percent for what C&EN sells their uniques. I would guesstimate $0.10-$0.20 of revenue per unique per month is a more sustainable model that a huge niche journalism outlet like C&EN will be force to aim for in 10-20 years. Unfortunately, this means many more painful cuts in C&EN's future.
Below are my suggestions to shore up C&EN balance sheets.
- Expand to non-ACS web advertising: C&EN already has a relationship with advertisers, if they initiated an affiliate program where independent chemical websites get a share of what advertisers are willing to pay for adspace. This expands the audience they can tell advertisers will see their ads.
- Many journalism outlets are scuttling their science sections. C&EN could sell their stories to these papers at a marked discount for what it costs to staff science journalists.
- Participate more strongly in ACS membership drives, more members equals more subscriptions which will hopefully be proportional to more ad revenue.
- Get a larger chunk of the budget subsidized from ACS.
None of these ideas are going to be the savior of chemical journalism, but it might ease the coming pain.
Mitch
Or you could just have Merck take over the whole thing. Apparently, they want to get into the publishing business. Here's their chance.
Or, you could go to and put your stories there. It is a free way to get published and get exposure to your stuff. Very neat!
Mitch: Appreciate your concern about C&EN’s future and your comments about our cost structure. Your analysis has some merit, but I’d like to make a couple of points about your numbers. I’m not going to comment about salaries, but there’s quite a bit more to C&EN’s journalism than just the salaries of its reporting, editing, and production staff. C&EN reporters travel to cover stories. We’ve got computers, telephones, IT infrastructure (this is a pretty big place). So the baseline that has to be covered by advertising revenue is quite a big larger—and our problem correspondingly greater—than your analysis suggests.
Your calculation of “uniques” doesn’t take into account pass along readership, which in C&EN’s case is fairly substantial, if hard to quantify. Easier to quantify, and at least as important, is the more than one million hits C&EN Online receives each month. If you’re going to count Chemistry Blog’s uniques, I think you have to count C&EN Online’s, too.
None of this gets us out of the woods you describe. We’re actively considering or pursuing three of the four ideas you floated in your post. I hadn’t considered the first one, but it’s intriguing. We’re also looking into several other potential new sources of advertising/sponsorship revenue.
I don’t know about the next 10 to 20 years—that’s outside my time horizon. I do want to say that I think C&EN’s going to be OK at least for the next several years after the actions we took last month and other cost cutting actions we’ve taken since the beginning of this year.
Rudy, I wonder if the future of CEN is more customized publishing... so every member gets a targeted magazine with articles that are specific to the ACS member's field (and ads that are appropriate for that member as well).... Have you heard of MagCloud? http://magcloud.com
Not sure what the price per page for CEN (or other journals) is... but targeted content might save on printing (since you only need to print what the reader wants to read) and offer higher ad revenue per printed ad.
Just a thought.
Awesome post, Mitch. CE&N should try driving more traffic to their website via social media. I'm in favor of syndicating their stories , but newspapers might not be able to afford them, and they would need to be a bit less technical. Perhaps they could build their brand by selling stories at a cut rate, and reap the benefits later.