A NEW AUSTERITY: As magazine companies grapple with a first half that was less than spectacular, Condé Nast is tightening its belt, WWD has learned.
The choppy first and second quarters have put Condé’s top brass on alert, causing the company to reevaluate budgets across titles. While the company has asked publications that are not on track to hit internal projections to start “correcting” their budgets, a source said the tightening up impacts all magazines at the company, regardless of their results. This has translated into a hiring freeze through the summer, unless special circumstances call for the addition of a new hire.
This story first appeared in the June 26, 2014 issue of WWD. Subscribe Today.
Condé Nast declined to comment.
But sources said that the Condé narrative centers around the “mixed retail environment and sluggish U.S. economic recovery.”
With fewer dollars available, advertisers have pulled back on pages, leaving Condé a “couple of points below plan,” according to a Condé insider.
Each magazine’s cost-trimming mandate is different depending on how far off the individual title is from hitting 2014 projections. Although first-half ad-page numbers were not readily available, a source said the smaller, leaner Lucky, for example, would not have to cut as much from its budget as the significantly larger Vanity Fair. The source confirmed that both of those pubs were down for the first half, and said that magazines with negative first-quarter ad sales continued the negative trend into the second quarter.
There were also some publications with positive first-quarter results that suffered ad page declines in the second quarter.
Digging into the first quarter, when Condé reported results in January, it said ad pages were flat, due mainly to a “flagging February.” At the time, the company released a list of its best performers, but omitted the underperformers, which included Allure, GQ, Lucky, Self and Vanity Fair. Teen Vogue’s ad pages dropped in the “double digits.”
That magazine recently experienced a trio of departures of senior staff, which included longtime fashion director Gloria Baume, online editorial director Naomi Nevitt and senior fashion news director Jane Keltner de Valle, who landed at Glamour. Baume and Nevitt are looking to consult for fashion and digital media. The magazine did replace all three openings with editors who overall had less experience than their predecessors. As a result, two of the job titles were slightly different: fashion news director and digital director. The title of fashion director remained, but Baume’s replacement was slightly less seasoned than the 11-year Teen Vogue veteran. Condé adjusts numbers for W, Lucky, Teen Vogue and Details based on those publications’ altered frequencies to 10 issues a year.
Meanwhile, it appears that Vanity Fair, which was in the process of building out its digital team, is holding off on making higher-level hires such as a deputy online editor, among other things.
Although W, Wired, Details and Bon Appétit posted increases in first-quarter ad revenue, sources indicated the magazines all had down second-quarter results. Vogue, which ended the first quarter down 1 percent, had a rough second quarter with pages declining 11 percent, a source with knowledge of the Publishers Information Bureau results said, giving the glossy a 5 percent dip in the first half of the year.
Top performers from the first quarter continued their hot streak in the second quarter. They included Architectural Digest, which saw a first-quarter ad-page jump of 14 percent; Glamour, with a 12 percent rise, and Condé Nast Traveler, with an 11 percent gain. Brides is also expected to report a positive first half.