Magazines need to make money from other ways besides the upfront cost of the hard copy. This is because most magazines are priced less than £5. There are many ways in which company's do this. E.g.
Circulation and subscription:
When you buy a magazine, the profit from that sale makes money for the magazine. However, this is called a single copy sale and involves very little profit. When all costs are added up such as transport, printing etc, the profit is very irrelevant as the costs are much higher. Magazines make far more money from subscriptions since they cut out at least one of the intermediaries to get their product directly to the consumer. The company will also have your address so this allows them to make a pitch to renew your subscription when it comes due.
Classified advertising:
When you open a magazine and go straight to the back page, there will be a classified section and want ads. In magazines with large circulation, ads are very expensive, even smaller circulated magazines charge high prices. Therefore this is a key part of how magazines make money.
Other advertising:
The single best way that a magazine makes money is by allowing advertisers to use its unused space throughout the magazine, including the covers and inside front and back cover. It is normal for a full-page back cover ad to run several thousand dollars or more in popular magazines with national coverage. Not only does the magazine make money with this type of advertising, it also fills up the pages by placing ads in spaces on pages around story lines. The magazine looks better and its revenue increases.
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