What this summer's slew of high-profile executive changes means for the industry's future
Summer in the magazine business usually means little news, with executives focused on their vacations. Long ones.
Perhaps it’s a product of the funk the industry has been mired in the last few years, but this summer has been different, with an unusual number of high-profile executives changing positions — shuffling the org charts at major publishing houses as companies look to build on the advertising recovery they saw during the first half.
In June, David Carey, Condé Nast group president, left to become the magazine division president at Hearst, replacing Cathie Black, who was kicked upstairs.
Condé Nast, in turn, made a slew of management changes in July, including the promotion of Bob Sauerberg, president of its consumer marketing group, to president of the company, reporting to Chuck Townsend, who had been president and chief executive officer (Townsend retained the CEO title). Lou Cona, EVP of the Condé Nast Media Group and former New Yorker publisher, was named chief marketing officer. John Bellando, Condé’s chief operating officer, was given the chief financial officer title, too.
At Meredith Corp., the second largest magazine publisher in the U.S., president Jack Griffin announced this week he would step down to “pursue another opportunity.” That opportunity appears to be at the world’s largest magazine publisher, Time Inc., where according to the New York Times Griffin is expected to take over for Ann Moore, the company’s first female chief executive and recent Magazine Hall of Fame inductee. An announcement will be made this week. (Griffin will be replaced at Meredith by Tom Harty, its president of consumer magazines.)
(Update Monday a.m.: See accompanying story, "It's Official: Time Inc. Replacing CEO Ann Moore With Jack Griffin.")
Moore’s contract with Time Inc. isn’t up until 2012, but she will be leaving on a rare high note. Time Warner reported that profits at its magazine publishing unit nearly tripled to $203 million during the first half of the year, driven, in part, by the Moore’s deep cost-cutting. (Ad revenue was up 4 percent.) And Moore steered the company through one of its darkest hours, a dramatic restructuring in 2008 during which roughly 600 staffers at the mega-publisher were laid off.
“It’s been a home run,” Moore said in 2009, a few months after the restructuring was executed. “It changed a culture that had been getting in the way. Decisions, efficiency — and innovation — are occurring faster inside Time Inc. than ever before."
Griffin is also leaving on a high note. Meredith, which publishes women’s titles like Better Homes & Gardens, More and Family Circle, last week reported a “marked a return to earnings growth” during its 2010 fiscal year. According to Folio, in terms of magazine industry advertising market share, Meredith’s increased to 12.3 percent — the highest mark in company history.
Carey’s defection also appears to be well-timed. After a tumultuous 2009 — in which the company made a slew of cuts, closings and watched ad pages evaporate — things appear to have stabilized at Condé Nast, at least in terms of advertising. (Through June, ad pages at Vanity and Vogue, two of Condé's jewels, were up 30 percent and 20 percent, respectively, compared to the first half last year.)
But of all the executive suite moves made in the magazine industry this summer, none were more notable than the promotion of Sauerberg [right], whose “primary responsibility,” Townsend said, “will be to move the company to a new business model focused around digital connectivity, technology development, and consumer insight.”
“Magazine publishing is at our core,” Sauerberg told Folio recently. “Print is still a key medium for Condé Nast and will be for a long time to come. However, it is not our only focus. Technology and consumer expectations have changed dramatically, and we think this is the moment to double down on the opportunities before us.”
To underscore the point, perhaps, Sauerberg’s first hire as president was the poaching of Joe Simon, Viacom’s chief technology officer, to become the first CTO in Condé Nast history.
“Technology will be the foundation of much of what our strategy will be long-term,” Sauerberg told Wired.com. Simon’s first assignment, much like Sauerberg’s, will be “to oversee the expansion of Condé Nast’s publications onto new platforms.”
According to Bill Mickey, executive editor of Audience Development magazine, Condé's elevation of Sauerberg “is a very public acknowledgement” that the relationship between publisher, marketer and audience is changing. And with the buzz surrounding new technology — especially the iPad — print advertising is no longer the singular driver, even at a glossy behemoth like Condé Nast.
"Advertising isn't the only game in town and neither is print,” Mickey told TheWrap. “Publishers have known this of course and have been diversifying accordingly. But what's emerging here is an understanding of the importance of cross-platform consumer insights. You can't build a multiplatform brand and launch products into a void, or simply assume your print subscribers will engage with a Web site or an app. You need a unified view of your customer behavior."
"Sauerberg's promotion is triggering more of an organizational change," Mickey added. "One where he'll make sure the marketing, data infrastructure and org charts are aligned to fully leverage the strategies."
Mickey noted that, with Griffin [pictured above, left], Time Inc. is headed in a similar direction. “Griffin might seem like he's a traditional publishing guy, but he's championed the marketing services push Meredith has seen success with,” he said. “He's leaving on a high note and you can't blame him for taking the top position at the country's biggest publisher. Moore has managed to keep Time Inc.'s profits healthy, but through cost cutting. I'm sure they'd rather see more profit generated from new revenue streams."