• by Ari Rosenberg , Op-Ed Contributor, March 25, 2005

Newsweek magazine's rate card lists an open rate of $231,000 for a page four-color bleed. Based on their rate base of 3,100,000 the cost per thousand readers reached (CPM) is $74.52. The published rate card for Newsweek.com however, does not list any rates.

Sports Illustrated publishes an open rate of $279,450 and a rate base of 3,150,000. This equates to a CPM of $88.71. The published rate card for SI.com does not list any rates.

People magazine reports an open rate of $216,200 for a page four-color bleed. At a rate base of 3,350,000, the magazine delivers a CPM of $64.54. The rate card for People.com however, fails to deliver any rates.

Three of the most well known magazines in the media industry are keeping their rates to advertise online a secret. That is because the big secret in online advertising is that there are no rates. By no rates, I mean there is no official cost per entry to run advertising online with these world wide established content brands.

I have presented this argument to those in the online space and they have collectively refuted this point by pointing to the CPM charged for online impressions as the rate (while politely holding off adding, "you idiot").

So for example, if Newsweek.com is selling their inventory at a $20 CPM, an advertiser can buy 1,000 impressions in exchange for one Andrew Jackson. Does that mean the cost to advertise on Newsweek.com is $20 bucks?

According to Webster, a CPM fulfills the requirements to be defined as a rate (whoops). Even if a CPM is technically a rate, why are they not listed on the published rate cards mentioned earlier?

An even more alarming question for content publishers is why are they selling their online impressions at CPM's significantly lower than the CPM derived from print advertising costs for the same content brand?

The CPM charged per thousand impressions online for a well-established content brand will range on average from $10 to $25 depending on the placement on the site and the quarter sold (inventory gets sold at higher prices in quarter four for most online publishers). These sites however, will also sell off their remnant inventory all year at well less than a $2 CPM, so the blended net average for impressions sold comes in closer to a range of $5 to $10.

The same content brand in print, even after a negotiated discount of 50 percent, delivers a CPM for reaching their paid readership of close to $40.

So why is the CPM for the same content brand in print as much as 400 percent higher than what's charged online?

Those in print will claim the intimacy of the medium (being able to hold the product in your hands) and the fact that their reader pays for content while the Internet is free, sustains this higher value.

The first point is eloquent sales positioning, while the second point is simply not true. The majority of online readers pay monthly fees to view online content. Internet services providers and not the content providers themselves collect these fees however.

The reasons premium content brands suffer diminished value online is threefold: one, there is more supply of available online inventory. Secondly, the clutter in which the majority of online ad exposures are presented decreases the perceived value and finally, there is less respect for the value of a content brand online because there is more focus on the performance of the campaign.

CPM's are rates, but they also reflect value. The irony is that online ad impressions should be valued higher than print ad exposures and here is why:

The CPM calculated for print is based on the delivery of the publication to its rate base of readers. Yet, we have all seen magazines go unopened or uncollected from mailboxes. Syndicated research will also tell us that even the most passionate readers of the best magazines do not read four of four issues or always read the issue all the way through.

A magazine CPM is calculated on the opportunity for an advertiser's message to be seen. The CPM calculated online however, is based on the guaranteed delivery of an advertiser's message in front of the reader.

This disparity in how print and online CPM's are derived should catapult the latter past the level of its print brethren. However, if content publishers continue to sell their brand short online, the opposite will ring true and the overall value of the brand will decline. How can it not?