RE: AMA"s MA again loses $$$

RE: AMA"s MA again loses $$$
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RE: AMA"s MA again loses $$$ - 5/22/2007 4:00:38 PM

JUGFLIER

Posts: 951
Joined: 1/29/2007
From: Muscle Shoals, AL, USA
Status: offline

Let me make it clear, i think the magazine should be more self supportive. OTOH, it does not matter what you pick for a format, either way there is a cost to the AMA member. Now it is six bucks. If you went to an online magazine with any type of articles you still need people to write stories, format it, print the articles, post them in the magazine and upload it to an internet websight. All this costs money. Lets say 500k a year(conservatively, very conservatively). Divided by 160k members, at the bottom end of a gestimation you are still talking about 3 bucks cost each member.

I don't think an online format is the answer at all. Even as you posted, the magazine is still advertising even for AMA. I still believe in a plan possibly to incrementally raise rates over a 4 or 5 year period.

(in reply to STLPilot)

Post #: 51

RE: AMA"s MA again loses $$$ - 5/22/2007 4:58:09 PM

rollo

Posts: 191
Joined: 5/24/2006
From: Sammamish, WA, USA
Status: offline

If I may jump in here and make a few points about some simple business practices that are being missed.

This talk about not raising rate to maintain a profit is a falisy--- Everyone HAS to raise rates heck even the post office raises rates to remain above margin. To stay in business you have to keep in pace with inflation, a simple lession from any economics class, if you don't the business will deminish.

Printed matterial is going by the way side to the internet is another falisy --- If that were true then why does Time magazine, National Geographic, and the host of others still print their mags. Yes they added an online group too, which meets the needs of some of their customers; however, the articles online are not of the same quality as the printed material. The complete move to an online magainze will result in failure and an even further loss.

Let's go back to a Marketing 101 class. Businesses make money by providing the right product to their customer. Marketers need to attract more customers to the business. Well last time I looked around my club meeting I was the youngest guy in there and I'm 35! What's the common age of most of the pilots at you're club flying the pricier models? If I would have to guess most are in their later '50s. They are all AMA members and customer that definelty have more buying power then I have to purchase advertisers more expensive products. Their demegraphics also prefer printed material over online because that's the world they grew up in. Oh and last time I check my Social Security issues the largest population is currently at the verge of reaching their '60s. Most are not internet savvy or will have the desire to get online, deal with the technical gizmo's once they retire, and will undoubtibly resort to their more simplistic ways.

If advertisers don't understand that then someone needs to be putting those numbers in front of them.

The real issues is the membership numbers. This is where the focus of the AMA and all of use as members should be residing. If you increase the demand or in this case the membership then you will decrease overall cost. This will make advertising more attractive to other business owners and help them increase their profits. This also increases the ability of the club to take action and assist in keeping fields and the hobby alive. If you want to keep the rights to field and open spaces that will need to be played in the political realm and nothing says keep it there then a lot of voting citizens. This entire conversation about the magazine should be switched to how to increase membership. Then maybe you can affort to add an online magazine in addition to the printed mag. Meet the need of the younger customers and the older members. The future of the AMA resides in all of those voices getting people to sign up and become members. If the sport is to stay alive we are all salesmen to bring in more members.

Regardless, if the company is a for profit or non-profit it's important to change with the business climate otherwise you become stagnant and failure is just around the corner.

< Message edited by rollo -- 5/22/2007 4:59:04 PM >

(in reply to JUGFLIER)

Post #: 52

RE: AMA"s MA again loses $$$ - 5/22/2007 5:06:33 PM

JUGFLIER

Posts: 951
Joined: 1/29/2007
From: Muscle Shoals, AL, USA
Status: offline

Good post. Many of my points. I have pointed out that IMHO, the electric parkflyers is now the entry level in this hobby, and the need to bring them into the fold.

(in reply to rollo)

Post #: 53

RE: AMA"s MA again loses $$$ - 5/22/2007 5:31:52 PM

STLPilot

Posts: 9218
Joined: 3/12/2003
From: Manhattan, NY, USA
Status: offline

quote:

This talk about not raising rate to maintain a profit is a falisy--- Everyone HAS to raise rates heck even the post office raises rates to remain above margin. To stay in business you have to keep in pace with inflation, a simple lession from any economics class, if you don't the business will deminish.

Since when do you simply raise rates to maintain your company profit? It's a bit more complex then that. Yes you made a good analogy by using the post office, a gov't based corporation that has a true monopoly. But lets compare the airline industry or just about any other corporation. Do they simply rates their rates to meet costs or do they adjust the costs of their operations to maintain profitability? Ummm, I'd take number 2. Supply and demand tells you that you can only price your products within the market demand, not what it takes to maintain your profit. Anyone that thinks that way in business will be out of business real quick. If you don't have what it takes to maintain profit, within your market demand, cash in your chips as fast as you can.

Also I don't recall seeing anyone saying that print is being lost to the Internet. But what IS happening is that Internet ad rate sheets are clobbering print rate sheets. The ones that are ahead of the game are the ones that offer web/print combos like you mentioned. They use bait and switch by giving you just enough information on their websites just so you'll subscribe to their magazine.

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Post #: 54

RE: AMA"s MA again loses $$$ - 5/22/2007 6:24:49 PM

LeeL

Posts: 326
Joined: 10/26/2002
From: Austin, TX, USA
Status: offline

STL your arguments just dont hold any validity companies raise rates every day to maintain their profit margin just look at the price of gas, or insurance, or how about grocieries do you pay the same price today that you did a year ago for anything? probably not and I seriously doubt that you pay less. MA can raise it's rates for their ad space based souly on some thing you yourself said, the mag has a guarintied subscription base of 160k verses other mags that average 70k or so. (we are talking r/c specific here so dont try to throw in something like national geographic) which makes the advertising dollar go much further. buisiness's know that they must advertise to survive and would grudgingly pay the increase for the guarintied circulation and that is truly economics 101.
Also just for your info the post office is not a monopoly, they are loosing money hand over fist because more people choose to use e-mail instead.
There are certian cost in buisiness that you can not control raw matls. is one utilities another but when you are the big dog of your niche as MA is based on # of subscriptions you can pretty much do as you wish.

< Message edited by LeeL -- 5/22/2007 6:38:24 PM >

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(in reply to STLPilot)

Post #: 55

RE: AMA"s MA again loses $$$ - 5/22/2007 6:53:18 PM

STLPilot

Posts: 9218
Joined: 3/12/2003
From: Manhattan, NY, USA
Status: offline

quote:

ORIGINAL: LeeL

STL your arguments just dont hold any validity companies raise rates every day to maintain their profit margin just look at the price of gas, or insurance, or how about grocieries do you pay the same price today that you did a year ago for anything? probably not and I seriously doubt that you pay less. MA can raise it's rates for their ad space based souly on some thing you yourself said, the mag has a guarintied subscription base of 160k verses other mags that average 70k or so. (we are talking r/c specific here so dont try to throw in something like national geographic) which makes the advertising dollar go much further. buisiness's know that they must advertise to survive and would grudgingly pay the increase for the guarintied circulation and that is truly economics 101.
Also just for your info the post office is not a monopoly, they are loosing money hand over fist because more people choose to use e-mail instead.
There are certian cost in buisiness that you can not control raw matls. is one utilities another but when you are the big dog of your niche as MA is based on # of subscriptions you can pretty much do as you wish.

Sorry but the US mail is a monopoly. Email and mail are 2 different products. One goes by mail and one goes by email. There is only 1 carrier of letter deliveries in the USA and its protected under a very old monopoly law. Do you know it's illegal for any other competitor to put anything inside your mailbox at your home? Do you know that USPS can regulate what their competitors must charge? Try mailing a post card from any other carrier and see how far it goes. Ummm this is a monopoly.

But it is funny that you mention they are getting killed by email, an Internet based channel which is relatively cheap. Jee wonder if magazines and print ads are feeling that wrath as those low cost advertising routes, they sure are! USPS continues to raise rates, WHICH ONLY PUTS THEM DEEPER INTO THE RED, what did that just tell you? It means USPS must adjust to deal with the times and the Internet not bury itself by simply raising rates. You just proved my point.

If AMA could charge more, they would. The question of the day is... why would they intentionally charge less then they can get? Who has an answer to that question?

< Message edited by STLPilot -- 5/22/2007 7:04:51 PM >

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Post #: 56

RE: AMA"s MA again loses $$$ - 5/22/2007 7:17:13 PM

Hossfly

Posts: 3850
Joined: 12/3/2001
From: New Caney, TX, USA
Status: offline

quote:

ORIGINAL: JUGFLIER

//snip//
Hoss, all this discussion has me to thinkin. Based on the financials posted here AMA took in roughly 900k in advertising while spending almost 2 mill. The difference in loss of the magazine cost each member 6 bucks.

Nothing better than when good men get to doing objective thinking, JUGFLIER. If all could throw the darts at the target, then someone will hit the bull's eye. Much better that throwing darts at each other.

quote:

So with that in mind, if you eliminate the printed magazine and go to an electronic format, you lose the advertising income, or at least some. Now what would be the cost per year to publish an electronic or online magazine, and what do you think the overall cost per member whould be? Any ideas? This is not a trick question, just something that occured to me.

Now here you maneuver me into dicussing my real objectives of all this cost issue. I have hit on these issues at some time, however three main items really apply.

1.) IMO. AMA should keep their advertising rates at the highest levels of model media advertising for two main reasons:
.....A. To NOT use their conscripted subscribers as unfair competition against free market modeling media. This should entice those media to better support AMA outreach programs in other media's magazines which do go beyond AMA's membership.
.....B. To assure that the AMA member is not subjected to advertising for "Trial" marketing and shoddy merchandise along with a high rate of unpaid ads. It happens! (AMA does not need to be a welfare system for garage shop operators)

2.) The AMA Officers and Staff need to be coerced into admitting to the membership that the cost-expense of the magazine far exceeds the cost of the member liability insurance which is historically used as the requirement for dues increases.

For example, the last dues increase was $10. The first issue to arrive after that dues increase became evffective, showed the member subscription price jumped from $12 to $18, a full 60% of the increase amount, while the Executive Council screamed, "Insurance Increase", and the membership never looked at the fine print, which is repeartd in the first paragraph of the light gray box, right bottom corner, page 199, May 2007, issue.

3.) The membership needs to know exactly how much the magazine does cost them. Given that the additional staff costs at least another half million in salaries and 'bennies', accounted for in AMA Staff expense, then the mag. is some $9 per person, (less than the quoted $18) still a fair price for a decent magazine, yet IMO, the member should be allowed to know that.

All this information can be verified if one cares to pick apart the auditor's reports in the Members Only sections of AMA's Web site.

If I were AMA President, not only would I fight to bring MA up to these standards, I would have a website that would inform all the membership of what was actually happening. I will tell it like it is, and I will identify the helpers, the stumbling blocks, and the bystanders. NO STINKING SECRETS -- NONE -- AND BEST OF ALL -- NO PERFUMED SECRETS

I have also proposed that AMA be divided into two units, the NFP AMA to serve the membership, and the AMA qualified to lobby such as EAA is so divided. Then there could be two magazines, one for the political folks and one for the strict modelers. You could have both at extra cost. There could also be a newstand version to go outside the choir and recruit those e fliers. AMA has so many options it actually boggles my mind.

AMA simply needs someone to put a stop to this idea that AMA is a rest home for certain GOBs. IMO there is in place an Executive Director that is already well aware of this as I observe some changes already made. With an EC that says "Da_n the Torpedoes, Full Steam Ahead," I firmly believe Aeromodeling could have a secure and bright future. Wanna' go for a great Ride. Welcome Aboard. It's really up to you!

_____________________________

Horrace Cain.
AMA Life L-93, Leader and CD for 45 years
Official Candidate: AMA Ex. Vice Pres. Vote H. Cain. Help move AMA into 21st Century
The only source of knowledge is experience. Albert Einstein

(in reply to JUGFLIER)

Post #: 57

RE: AMA"s MA again loses $$$ - 5/22/2007 8:37:07 PM

rollo

Posts: 191
Joined: 5/24/2006
From: Sammamish, WA, USA
Status: offline

quote:

ORIGINAL: STLPilot

quote:

This talk about not raising rate to maintain a profit is a falisy--- Everyone HAS to raise rates heck even the post office raises rates to remain above margin. To stay in business you have to keep in pace with inflation, a simple lession from any economics class, if you don't the business will deminish.
Since when do you simply raise rates to maintain your company profit? It's a bit more complex then that. Yes you made a good analogy by using the post office, a gov't based corporation that has a true monopoly. But lets compare the airline industry or just about any other corporation. Do they simply rates their rates to meet costs or do they adjust the costs of their operations to maintain profitability? Ummm, I'd take number 2. Supply and demand tells you that you can only price your products within the market demand, not what it takes to maintain your profit. Anyone that thinks that way in business will be out of business real quick. If you don't have what it takes to maintain profit, within your market demand, cash in your chips as fast as you can.

Also I don't recall seeing anyone saying that print is being lost to the Internet. But what IS happening is that Internet ad rate sheets are clobbering print rate sheets. The ones that are ahead of the game are the ones that offer web/print combos like you mentioned. They use bait and switch by giving you just enough information on their websites just so you'll subscribe to their magazine.

Let's compare the airline industry. Yes they raise their rates to meet cost of course! Let's see the price of gas goes up and so does the price of your ticket! The weather gets cold and the price of your ticket goes up. They also are creative in the ways the bring in money by charging you for food, drinks, etc... I remember getting that stuff for free on all flights. So yes even the airline industry raises their rates and they do it to meet their costs. A company can only cut so much into the operational cost before they become unprofitable and this is in an industry that has a consistant demand too. Businesses need to fly to stay in business and meet with clients, customers, and work on the global plateform.

The comments about supply and demand are basic there are other factors that affect supply and demand.

If you took a class you would also understand that there is a third factor in creating a demand and that's emotion. Let's talk gourmet coffee and water, these are two industries where companies make billions of dollars off of a product on of which a person can get for free and the other where you can go to the grocery store and buy a jar for much less. They have created their demand. These companies raise their rates in order to meet the demand of their customers, guess what, they have to raise their rates to maintain operational cost. To make more a company has to use more which then brings in the price they pay for cost of goods. Just like gas which the airline industry uses. The AMA needs to purchase paper. I am sure that probably cost more so they have to raise rates to meet the cost of supplies. Let's talk about any product. If companies didn't raise their rates then you would still be paying a nickle for a soda and gas would still cost a few cents. Inflation my friend causes rates to increase and is why operational cost increase.

My post did offered a solution and that was to increase the demand by communicating to advertisers that there is a market that they can sell the whares too. By showing these advertisers the demand potential they will be more then willing to pay more for advertising.

Oh and by the way the US mail is not a monopoly. There is Fed EX, DHL, UPS, Oh yea and the big free competitor the internet. Hmmm and I am pretty much guarenteed my message will get there rain, shine, and even on holidays.

(in reply to STLPilot)

Post #: 58

RE: AMA"s MA again loses $$$ - 5/22/2007 9:01:19 PM

Jim Thomerson

Posts: 2825
Joined: 10/9/2002
From: Austin, TX, USA
Status: online

As I see it all ads are a service (one hopes) to the membership. Of particular service are the cottage industry ads of folks (all AMA members?) They are providing needed goods and services for micro niche markets in the model aviation community. Basically hobby vendors who are not making a living, or trying to. Just providing a service, hopefully not going broke, and having fun. I have no problem with subsidizing these folks a little bit.

(in reply to rollo)

Post #: 59

RE: AMA"s MA again loses $$$ - 5/22/2007 9:40:55 PM

ptulmer

Posts: 4770
Joined: 4/28/2003
From: Brunswick, GA, USA
Status: offline

Jim, excellent point! I think STL might be trying to make that point, also. You just gotta filter out the rest of his "argument" to get to it. Definitely a valid enough point to back up and rethink my position. I still think that the ad cost is a real point of contention between the AMA and other magazines.

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Post #: 60

RE: AMA"s MA again loses $$$ - 5/22/2007 10:32:40 PM

STLPilot

Posts: 9218
Joined: 3/12/2003
From: Manhattan, NY, USA
Status: offline

quote:

ORIGINAL: STLPilot
Let's compare the airline industry. Yes they raise their rates to meet cost of course! Let's see the price of gas goes up and so does the price of your ticket! The weather gets cold and the price of your ticket goes up. They also are creative in the ways the bring in money by charging you for food, drinks, etc... I remember getting that stuff for free on all flights. So yes even the airline industry raises their rates and they do it to meet their costs. A company can only cut so much into the operational cost before they become unprofitable and this is in an industry that has a consistant demand too. Businesses need to fly to stay in business and meet with clients, customers, and work on the global plateform.

The comments about supply and demand are basic there are other factors that affect supply and demand.

If you took a class you would also understand that there is a third factor in creating a demand and that's emotion. Let's talk gourmet coffee and water, these are two industries where companies make billions of dollars off of a product on of which a person can get for free and the other where you can go to the grocery store and buy a jar for much less. They have created their demand. These companies raise their rates in order to meet the demand of their customers, guess what, they have to raise their rates to maintain operational cost. To make more a company has to use more which then brings in the price they pay for cost of goods. Just like gas which the airline industry uses. The AMA needs to purchase paper. I am sure that probably cost more so they have to raise rates to meet the cost of supplies. Let's talk about any product. If companies didn't raise their rates then you would still be paying a nickle for a soda and gas would still cost a few cents. Inflation my friend causes rates to increase and is why operational cost increase.

My post did offered a solution and that was to increase the demand by communicating to advertisers that there is a market that they can sell the whares too. By showing these advertisers the demand potential they will be more then willing to pay more for advertising.

Oh and by the way the US mail is not a monopoly. There is Fed EX, DHL, UPS, Oh yea and the big free competitor the internet. Hmmm and I am pretty much guarenteed my message will get there rain, shine, and even on holidays.

While I disagree with this entire post is neither here nor there. Regardless I still can't understand a couple of things. One, why on earth the AMA would charge less then you and the rest of you think they could get. The other thing is that if everyone thought that MA was so cheap, why don't all the advertisers run full page ads. And as far as educating manufacturers in selling their products via ads in MA, there is only 2 things you have to tell them, 160,000 subs and mostly aeromodelers, what else do they have to know? MA is not the powerhouse it used to be, it has a lot more competition then 10 years ago, you're looking at their #1 competition right here at RCU.

quote:

Inflation my friend causes rates to increase and is why operational cost increase.

Just booked a ticket to RT to Chicago/NYLI for $79, thanks to one innovative company that has turned the airline industry upside down, Southwest. That's a lower price then you could get in the early 70's and what did you say gas prices were right now? Every airport to destination which SWA entered caused their competion to reduce their rates by an average of 40% reduction, inflation?? Emotion?? Inflation has had no effect on that industry, but competiton sure has. And the only people who get stuck with gas problems are the airlines and that's why the gov't has been digging them out of the red because of all the new competition from the "smarter" airline companies. Just like your membership dues dig out the deficit for MA, competition. But hey, it's only $6 per member for a pretty cool magazine.

Why the AMA would put their rates below market value, let's here one good reason why they would do something like that.

< Message edited by STLPilot -- 5/23/2007 3:14:54 AM >

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Post #: 61

RE: AMA"s MA again loses $$$ - 10/12/2007 5:34:41 PM

littlecrankshaf