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Magazines 24/7 Coverage: Raising the Digital Bar in a Down Economy

Panelists share digital revenue percentages and thoughts on how they might increase revenues in the coming months and years

For The Knot, digital has always been their center. It represents 80% of their total revenue and 50% of that is ads (30% national and 20% local).

“We’ve always been in start-up mode and have always learned how to make the best product at the lowest price tag,” said Carley Roney, Co-Found & Editor-in-Chief, The Knot, Inc.

Weddings are recession-proof and luckily, readers still require services from advertisers, especially on the local side.

The other 30% of their digital revenue comes from ecommerce. “We sell $13 million of supplies to our audience,” said Roney. They use a lot of real estate on their site for ecommerce, as a site can only have so many advertisements. Products are a great way to go.

Roney advised, “Let’s keep our eyes on the prize. Keep completely focused on delighting the audience and all will be fine.”

Another key to success for The Knot has been in making sure they have great talent on their editorial staff, and paying them really well.

Hearst reports 8-10% of US revenues in 08 came from online

John Loughlin, EVP & General Manager, Hearst Magazines reported that they have had huge success in 2008 selling more than 2.2 million net paid subscriptions. Compare that with the 600K they sold in 2006, which is when they took ownership of their brands online. They’ve also managed to move their net profit per sub from $6 in 2006 to $9 in 2008.

“We’re experiencing different shades of ugly,” said Loughlin. Hearst’s digital business will have 30% growth in the first quarter, which is less than they budgeted.

He reinforced that it’s time to get creative, in their case by offshoring and outsourcing, in order to maximize revenue any way possible. “We’ve become much more aggressive about outsourcing and offshoring. We’re doing some QA in Vietnam, we’re doing open source programming in Poland. We haven’t used it to take people out, but we are upscaling the jobs here and outsourcing the lower level stuff.”

“Hope is not a strategy, it’s the future,” said Loughlin. 

BusinessWeek reports 20% of total revenue coming from digital

BusinessWeek started its digital efforts in 1995 and it now accounts for 20% of overall revenue. Roger Neal, SVP & General Manager, BusinessWeek.com said that this nasty economy provides a “tremendous opportunity on digital side.”

There has been an acceleration of trends and advertisers are looking for more performance. “There’s a sea change in how users consume content,” said Neal. BusinessWeek recently built out the Business Exchange, a Digg-like user-driven news site that allows users to create business topics, collaboratively aggregate content from the entire Web and connect with other business focused users around these topics. Neal admitted “it’s ugly from the advertising side but it’s looking up from the user side.”

 

More Magazines 24/7 Coverage:

Are Paid Membership Websites the New Black?
Executives from ESPN, Rodale and Harvard Business Review discuss the challenges and benefits of charging users for online content 

Rethinking Decision-Making in a 2.0 World
Google’s Analytics Evangelist, Avinash Kaushik, tells magazine publishers why some of their sites “suck” and what kind of thinking is required to fix them

Print Vs. Web – The Editorial Challenge

Editors gather for a candid discussion about what’s working online and what isn’t

Posted in Multiplatform Publishing Strategy

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