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Having ridden the wave of the luxury boom, or hoped to get a piece of it, many magazines now are finding themselves squeezed by shrinking advertising revenue, in addition to the afflictions that have already beset the newspaper industry, including high production costs and competition for attention spans from the cash-draining Internet.
The belief that the high-end customer would be recession-proof had kept many magazines decently equipped with ad pages even when the overall economic picture dimmed. But with the tremendous wealth of the financial sector drying up, retail sales stagnating, aspirational consumers slamming their wallets shut and many major brands trimming ad budgets — or holding off on committing any spending — publishers seem to be preparing for the worst.
The luxury-oriented titles join the rest of media, traditional and digital alike, in worrying about the future. According to the Publishers’ Information Bureau, magazine advertising revenue declined 5 percent in the first three quarters of the year, to $18.4 billion, and the third quarter itself saw a decline of 8.8 percent. The biggest drop was in automotive, a long-troubled category, but there were also single-digit drops in page numbers from apparel and accessories and from retail.
On Thursday, Condé Nast Publications Inc., which has so far been relatively insulated by its private ownership and stable of affluent-aimed titles (and which also owns WWD), said it would absorb Men’s Vogue into parent magazine Vogue, retaining only editor in chief Jay Fielden (and reportedly his assistant) to edit a biannual supplement.
Portfolio, the ambitious business magazine the company launched in 2006, laid off nearly all of its Web staff as well as several magazine editors and writers, and reduced the magazine’s frequency to 10 times a year. Managing editor Jacob Lewis was said to be going from office to office at the title on Thursday to inform those editors and writers who were being let go, with at least nine being laid off as of Thursday afternoon.
The company is also expected to make budget cuts of 5 percent across its titles, which could include reductions by attrition or layoffs. Advertising Age reported Condé Nast will suspend its Fashion Rocks and Movies Rock concerts and supplements next year.
Publishing director David Carey said Portfolio’s moves were responding to an economic picture decidedly different from the one in 2006, when the magazine launched. The goal, he said, is “a realistic infrastructure, and to not just carry forward all of our 2006 plans as if the world never changed.”
That was also the year that 02138, Radar and Culture & Travel launched, with their own respective fanfares and bids for the wealthy reader. All three of those titles were closed this week.
Every publisher is dissecting its cost structure and stable of titles, from Hearst Magazines to Hachette Filipacchi Media and Time Inc. to Rodale. And in recent days, American Express Publishing, whose titles include Food & Wine, Travel + Leisure and Departures, said it would cut 22 jobs, or 5 percent of its workforce. Hearst quietly began going “floor by floor” to cut costs, notably at the upscale Harper’s Bazaar and Town & Country.