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Magazines Rethink Strategies to Deal With Economy

Like many other American businesses, it’s the worst of times for magazine publishers. The question is: Can they bounce back — and how?

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with contributions from Irin Carmon, Amy Wicks
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Conde Nast Portfolio Cover

Photo By Courtesy Photo


The guides take “core Men’s Health material and put it in a format that’s irresistible to browse,” said David Zinczenko, Rodale senior vice president, editor in chief of Men’s Health and editorial director of Women’s Heath and Best Life. “And it helps with a fundamental dilemma in, how can I choose foods that are good for my health?”

Zinczenko also said the 1.8 million-circulation Men’s Health is looking at other ways to repackage content, including downloadable PDFs. But of any new venture, he said: “We don’t rush into things that can’t turn into a stand-alone business. Books are attractive because we have figured out that you can pull things from the magazine. A great cover line or column could become a book.”

The “Eat This, Not That!” books, published by Rodale, have sold almost a million copies at $20 a pop, a substantial boost to Rodale’s bottom line. “If you’re not paying advances and you’re doing it in-house, you could launch a franchise this way for $150,000 and suddenly the book in a year is throwing off more profit than a typical magazine,” Zinczenko said. “And, like a magazine, books are not easily copied.”

But how will the industry attract more attention from a consumer who spends most of his or her time online, and whose main form of communication is a text message or an e-mail, with discourse barely longer than a sentence? How will magazines survive among Facebook, MySpace and Hulu? In short, the entire magazine industry needs to reinvent itself. The question is, how?

For starters, publishers must spend money. “Magazines must put out amazing content for their readers. That takes money,” said Brenda White, senior vice president/publishing activation director for media agency Starcom USA. “I would hate to see in light of cost cutting that the content suffers. When we see that, consumers won’t follow anymore.”

That includes a magazine’s Web site, which functions as a real-time companion to monthly titles and a source for generating subscriptions. Some media observers were puzzled by the decision to scale back portfolio.com, an offering that helps keep Condé Nast Portfolio’s monthly magazine competitive with financial news leaders Yahoo Finance, CNNMoney and wsj.com. In September, the month where Wall Street’s collapse made daily front-page news, Nielsen Online reported that portfolio.com gathered fewer than 2 million unique visitors a month, compared with Yahoo Finance’s 24 million and cnnmoney.com’s 10 million. David Carey, a Condé Nast’s group president who oversees Portfolio, Wired and the Golf magazines, argued that the company is still investing in portfolio.com, but operating more efficiently under a different business model. Portfolio.com now will operate with fewer full-time staffers, trimming significant overhead costs. The site will have fewer daily updates, but more content from outside sources including other Condé Nast magazines.

Nevertheless, while some have seen sizeable ad sales gains on their Web sites — Sports Illustrated now earns 18 percent of its revenue from online — few publishers have figured out how to make a sizeable business online. At the end of the day, magazines’ Web sites still generate a fraction of the revenues of the September issues of Vogue, In Style or W.

Tapping into sites such as Facebook and MySpace can be used to create interest and buzz, but should be approached strategically.

“It becomes important for publishers to continue to spend time and money to determine what does work on the new digital platforms,” said media consultant Larry Kramer, who has worked with media companies including Condé Nast Publications (parent of WWD) and founded CBS Marketwatch. “What do people want out of your categories on the Internet? The answers will be very different for different types of magazines.

“In the case of fashion, it may be video, enhanced search characteristics for photos and video, so fashionistas can more easily research style and design,” he said. “In sports, it may mean more creative use of data to run fantasy games and more interactivity, rather than more background articles which may be better suited to print. Business or investment publications may need much more personalization on the Web because investors are uberconcerned about the stocks they own, not just the overall market, and print can’t personalize in real time.”
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