This time around the discussion is advertising in comic books, not for or about them, which is a topic for another time. And be forewarned, as I got toward the end if this I realized I hadn’t really reached any conclusions and I didn’t really have much of a point. I’m pretty much just rambling, so read at your own risk.
If you managed to make your way through my first Economics of Comics post then you may have read commenter John’s suggestion regarding, “selling more ads in comics to help subsidize the cost…I'd be willing to flip through a bunch of ads if it meant paying less.” If you did, you may have thought, “Yep, me too.” Or, “No effen way do I want more ads in my comics.” And what if more ads equaled a lower cover price by say a fifty cents or a dollar or more?
I’m going out on a limb and say the vast majority of us would happily put up with more ads if it meant a cheaper book. But how much is too much and what are the tradeoffs?
Right now your mainstream, 22 page comic from Marvel or DC will carry anywhere from seven to 13 pages of advertising, not counting covers ads for other books or in-house promotions. In-house advertising -- which is likely charged against the advertising department and counted as advertising revenue on the books -- doesn’t qualify as net income in my analysis, although I’m sure I’d get an argument from someone on that. Cross-promotional efforts are surely validated by increased sales on the promoted books (although why GREEN LANTERN would need to promote JUSTICE is a bit beyond me) but in the end you’re not going to lower the cost of a book by inserting more of these, so they get removed from the equation.
Obviously the number of advertising pages is directly tied to the expected distribution of the book; advertisers are looking for maximum exposure and publishers have to deliver a certain number of eyeballs to support their ad rates. So DC could max out the number of paid ad pages in their more popular books fairly easily (one assumes) while Dark Horse or Image might struggle a bit to sell all the available pages in their better titles. This is not just because any one book is so successful but because DC can leverage advertising across a large number of long-established books while Dark Horse really can’t.
Relatively large distribution doesn’t mean that the Big Two are going to automatically jack up the ad pages. After the success of the first issue of ALL STAR BATMAN & ROBIN, DC could probably double the advertising pages (11) in subsequent issues but it seems likely they won’t. Issue two had the same number -- not much time to adjust for that one, admittedly -- and I expect most of the run to hover around 11-13 ad pages. My suspicion is that when a book has this level of success rather than increase the advertising page count, the publisher jacks up the existing page rate. So we may even see a page or two fewer ads in later issues of ASB&R as DC will be able to charge a premium and then use the freed up space for bolstering sales of other titles. (This presumes it stays at the top of the charts - if issue two was a sample of things to come, it won't.) The short of this is there’s clearly a cap in how many pages a publisher is willing to introduce into a comic -- even a successful one -- and that’s most likely tied into some established formulas taking into account ad dilution, marketing agreements, aesthetic appeal, etc. Setting aside any of these complicating issues, how many more ad pages would you be willing to suffer through to garner a 20 percent price savings? How about 30 percent? Personally, I think the ad count could double without alienating most readers, but I’ve worked in the technology sector for a long time and can remember when industry mags were 500 pages thick, with about a 5-1 ad to content ratio. I’m not sure everyone else would be as tolerant. But a 1-1 or 1.5 to 1 would most probably be acceptable to most of us under the conditions of lower cover price.
Of course if Marvel and DC decided to go this route, some of the previous mentioned variables would have to be considered. Firstly, dilution. How many more movie and video game ads can there be before advertisers begin questioning if their message is making it through the increased noise? Page rates would probably come down some to offset this but, hey, make it up in volume, right? Secondly, and this is a big one, will the potential increase in ad revenue provide the proper offset to the loss in revenue brought on by the lower comic prices? It seems unlikely that any sane amount of ads would allow the price to drop to much below $2 per book unless the circulation numbers dramatically improved as well. And I mean dramatically, like double. How likely is that? Not very. Consider: COUNTDOWN TO INFINITE CRISIS was the number one selling book in March of 2005 with an estimated sell of 199,500. The book was a pivotal intro to DC’s major story line for the next year and retailed for a mere $1.00. Three months later HOUSE OF M #1 sold an estimated 233,700 copies, a 17% increase, at $2.99. (For a net financial difference of nearly half a million dollars, which had to have someone at DC scratching their head.) There may be a lot of reasons why it didn’t happen, but at a buck a book you’d expect at least 250,000 units sold – I’d expect closer to 300,000. This could become case study number one for not lowering comic book prices.
I guess if there is a point to be made it’s that simply increasing advertising may not provide the savings that make for lower per unit costs and as a corollary, lower per unit costs may not result in greater total unit sales. (It may be that the Big Two could increase their ad page count without lowering prices or losing readership, but that’s not what we’re all about here today.) Bottom line: if lowering prices aren’t going to increase readership then there’s very little incentive for the publisher to do so. What if doubling the ad count would only afford a 10% savings in the cover price? Would you be happy with 22 pages of ads in a 22 page story for thirty cents less? I wouldn’t.
Truth is, when it comes to the Big Two advertising is one area where I think they have things pretty well wired. In particular DC, as part of Time Warner’s publishing division, has nearly unparalleled access to experience and resources in this arena. It’s doubtful they’re leaving much on the table in terms of advertising revenue. Both companies have probably run through many different scenarios to arrive at the current formulas; they know who their advertising to, what products appeal to them, what mix of ads provide their sponsors the proper exposure, what books will maximize that exposure and where the prime real estate within the book is. Am I giving them too much credit? I doubt it.
So this whole post is a big what if because there’s very little chance of DC or Marvel increasing their advertising and lowering their cover prices. Even if they were making significantly more profit it’s doubtful they’d lower prices. I think you’d get further lobbying for more pages than for lower prices.
So next I’ll look at advertising for small press, who’s issues are clearly different than those of the big guys. And I’ll lay out my thoughts on how they could improve their advertising revenue.
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