Circulation Vs. Advertising Revenue
Circulation is the number of paid subscribers that magazines and newspapers have. Broadcast media -- television and radio -- do not use the term circulation; instead, they measure their audiences in terms of viewers and listeners. Advertising revenue is how much money media earn from selling advertising space or time. This is applicable to all forms of media: print, broadcast and digital, such as Internet and mobile. Small business owners need to pay attention to both numbers to calculate how many people they can reach through public relations and advertising efforts.
Circulation is a revenue source for publications and a gauge as to their ability to generate advertising revenue. As a business person, consider circulation figures when deciding whether to buy advertising in a publication. Typically, the higher the circulation figures, the more advertising costs, but you may decide it’s worth it due to high circulation figures. That’s why circulation figures are audited to ensure credible calculations. The Alliance for Audited Media – formerly the Audit Bureau of Circulations – sets circulation rules and performs audits of print and digital media. This includes online publications that charge each time you access them, known as paywalls.
Don’t confuse circulation with readership, which is a calculation of people who read a publication. Readership is almost always higher than circulation. Readership is measured by the Media Rating Council. It’s important to you as a small business advertiser, because it breaks down readers by demographics. If you want to reach homemakers of a certain age or income level, look at readership levels. Readership also attempts to calculate “pass along” readers; for example, a woman waiting in a pediatrician’s office will read a magazine but she did not pay for it.
Print advertising revenue has declined overall as of 2012, even for magazines where circulation and readership have still been high. Newspaper print circulation and advertising have both been low, as readers and advertisers have moved to online editions. It is mostly large companies who make up print advertising revenue, while smaller businesses have gone to online ads. This is important as you decide to spend limited advertising dollars; with online ads, your customers can “click through” an ad to go directly to your website or product information.
Online advertising revenue has risen as digital media becomes more popular. There are also many websites that aren’t news publishers selling online advertising. As of 2012, television advertising revenues declined; in general, TV advertising is cost-prohibitive for small businesses. Radio or audio advertising revenue is also changing as digital radio advertising, both online and mobile, increases in popularity. As a small business owner looking to advertise, following ad revenue trends to digital media can lead you to a bigger audience and a better value for your advertising budget.