Hello, folks! Fran here. 👋🏿

As we transition into the final months of the year, it's the perfect time to sharpen our focus on something crucial yet often overlooked: a solid pricing strategy for advertising clients. In this edition of The Boost, let’s dive into the world of pricing models, exploring the factors that shape them and celebrating a success story that strikes the perfect balance.

Here's the lowdown: Generally, there are two main pricing models in our arsenal - CPM (that’s “cost per mille”… aka cost per thousand impressions) and flat rate. The question is: which one should you use and when? A few considerations:

• Willingness to pay: Does your product align with your client's budget and needs? This varies widely across different regions and industries, of course.

• Competitive market value: How does your offering compare to others in the field? If clients are too comfortable with your rates, maybe it's time to reach a bit higher.

• Product currency: Keep your offerings fresh and appealing. Engage your clients and customers continuously and make your product both indispensable and accessible.

Agility is crucial in rate setting. While research provides a strong foundation, true agility is born from experimentation. Begin with industry benchmarks — perhaps $30 CPM or a weekly flat rate of $1,000 for digital display ads, tiered event packages, and a baseline of $500 for newsletter sponsorships. Then, be bold in adapting these rates based on market response.

Fort Worth Report, a participant in a Blue Engine-run GNI Sponsorship Lab, is a stellar example. They tweaked their offerings during the program and saw sales revenue leap from a pre-Lab average of $10,183 to a post-Lab average of $23,467 monthly. They learned to say no to misaligned opportunities, focusing on fewer, higher-margin sales.

To fine-tune your pricing strategy, here’s a quick guide to the math:

And if your effective CPM or flat rates are being met with nods all around, without a hint of client hesitation, it might be time to experiment with a rate increase.

Want to crunch the numbers further? Drop us a line (hello@blueenginecollaborative.com) to get a copy of our pricing calculator worksheet. It can help you estimate your eCPM, plus price out newsletter sponsorship, site display advertising and event sponsorship.

Until next time, keep testing, keep learning, and keep growing!

Thanks,

— Fran and the Blue Engine Team

Your Metric Moment

This month, focus on 'Average Revenue Per User' (ARPU), which illuminates the average monetary contribution each user attributes to your revenue. Here’s how to calculate it:

Total Revenue / Total Number of Users = ARPU 

This calculation lets you gauge whether your pricing fits user engagement and your organization’s sustainability. 

About Coach

Fran Scarlett is an experienced Blue Engine coach and advisor known for her leadership, nonprofit growth, and change management expertise. She has contributed to multiple GNI Sponsorship Labs, the Racial Equity In Journalism Digital Audience Growth Challenge, the Digital Transformation Project, and Media Transformation Challenge at Poynter Institute, among others. Fran’s background includes stops as the Chief Knowledge Officer at The Institute for Nonprofit News (INN) and as an entrepreneurship and organizational behavior faculty member at the Cameron School of Business at UNC-Wilmington.   

Beyond These Walls

Over at The New York Times, Joy Robins is shaking things up as ad chief, putting attention metrics front and center when it comes to selecting new clients and shaping their campaigns, according to a Digiday podcast interview.

And talk about a plot twist — turns out those programmatic ads in the NYT app aren't the nuisance they were made out to be, according to their audiences. So they're back in action. 

A moment of gratitude

We'd be remiss if we didn't thank our friends Melia Albrecht, Robbie Brown, and the many folks at the Google News Initiative for their support of our just-wrapped Advertising and Sponsorship Labs in North America and Brazil. 

A round of applause to the organizations who doubled down on their ad strategies – and more than doubled (literally) their average monthly advertising and sponsorship revenue. We’re buzzing with excitement for what’s ahead of them.