It’s the publishing industry’s version of a feature film with big stars, big money, big glamour and big drama.
Condé Nast is the company everybody loves to obsess over — and this year, they gave media junkies plenty to ponder. With digital investment, layoffs and magazine closures, Condé is a sort of microcosm of a transforming and traumatized media sector.
This story first appeared in the December 16, 2015 issue of WWD. Subscribe Today.
Company president Bob Sauerberg, who will be named chief executive officer on Jan. 1, has begun to compile his A-team. They include artistic director Anna Wintour; chief digital officer Fred Santarpia; executive vice president of consumer marketing Monica Ray; chief financial officer David Geithner; chief marketing officer and president of Condé Nast Media Group Edward Menicheschi, and Dawn Ostroff, who is president of Condé Nast Entertainment, Sauerberg’s pet project.
With the backing of Condé’s top brass, Wintour, along with Sauerberg, is wielding the keys to the kingdom and her moves to transform editorial are in full swing. But even she has encountered some pushback over the past year from other high-profile editors, such as Vanity Fair’s Graydon Carter, according to buzz from inside the corridors of One World Trade Center, Condé Nast’s new headquarters.
While the genesis of a power struggle may be years in the making, it came to a head over the summer when Vanity Fair put Caitlyn Jenner on its July cover, making that magazine issue the most talked-about of the year. Although it was a big win for Carter and Vanity Fair, which has been rumored to be prime for a shake-up, it evidently didn’t curry any favor with Wintour. Wintour, who oversees all of the covers at Condé and attends the company’s individual print order meetings, reportedly was not looped in by Carter, even though a broad swath of midlevel Vanity Fair staffers knew about the secretive photo shoot that unveiled Bruce Jenner’s transition to Caitlyn.
The artistic director/Vogue editor in chief was “furious over Carter’s lack of transparency,” a source close to both editors said, adding that Wintour viewed Carter’s stealth move as an example of “hubris.”
But power struggles have always been endemic to the Condé culture. Whatever the conflicts of 2015, the company’s execs are charged with accelerating its digital transformation. Although that transition has been in the works for some time, it was kicked into overdrive when Condé said in September that Sauerberg, who was appointed president in 2010, would succeed Chuck Townsend as ceo. The news hardly surprised those at Condé headquarters; Sauerberg had already been front and center as the face of the company — along with Wintour — over the course of the year.
His past work perhaps gave employees a sense of ease, as he often talked about and executed on building the company’s digital reach through acquisitions, such as Pitchfork Media, new business initiatives that included the development of Condé Nast Entertainment, 23Stories, its branded-content unit and the relaunched e-commerce site, Style.com.
The other side of Condé Nast’s transition also entailed and many suggest, still entails, cost-cutting in the face of eroding revenue from print advertising and magazine (newsstand and subscription) sales, as many readers have migrated to digital. That problem is a common one across the industry, and has led to layoffs and closures of various publications.
Sauerberg, who is known as a decisive executive with a penchant for number-crunching, sprung into action on that front, after Condé logged another down year. (Insiders said 2015 marked the third flagging year in a row.)
Last year, Condé had instilled a hiring freeze, trimmed some of the mastheads, slashed more than 50 jobs in its media group, sold Fairchild Fashion Media, owner of WWD, to Penske Media Corp., spun off Lucky to Beachmint and combined Bon Appétit and Epicurious.
Over the summer, the rumor mill began to churn that something was coming. There was speculation that the company might shutter or combine its smaller, struggling titles. Staffers were lulled into a sense of security as Labor Day — the time period of the prior-year layoffs — slipped by without incident.
The changes that would help build the foundation of Sauerberg’s Condé Nast began to take hold before the Thanksgiving holiday. Within two weeks, the company shuttered Details, which amounted to 55 job cuts, on top of cuts at individual titles that ranged from two to upward of 20 staffers. Earlier in the year, Condé had already slimmed down editorial staffs across its magazines as it prepared to move offices from 4 Times Square to 1WTC.
In recent weeks, WWD reported on layoffs at GQ, Allure, Self, Teen Vogue, Condé Nast Traveler, Glamour, which also shuttered Glam Belleza Latina, its quarterly Hispanic glossy. Noteworthy departures included Condé veterans such as founding Allure editor in chief Linda Wells, Teen Vogue publisher Jason Wagenheim, Condé Nast Traveler publisher Bill Wackermann and Self publisher Mary Murcko.
Perhaps the most seemingly inevitable closure was Details, which appeared to be on the chopping block since it relaunched 15 years ago. Despite its vigorous digital growth, Details editor in chief Dan Peres and publisher Drew Schutte were both let go, as were the staffers who worked on the magazine. Details’ 12-person Web team is expected to find jobs at GQStyle, GQ’s biannual magazine that will now print four times a year.
Across the organization, the changes mandated a sort of recombining of roles, true to summertime speculation. Glamour publisher Connie Anne Phillips is now overseeing Self, as the two teams are further merged on the business side. Additionally, Vogue’s Susan Plagemann is now in charge of Teen Vogue’s publishing operations. (The mergers have since called for a recombination of jobs, and thus layoffs to eliminate redundancies.)
To replace longtime publisher Wackermann, Condé brought back Brendan Monaghan, who left the company a year earlier to head up The New York Times’ luxury business and serve as publisher of T: The New York Times Style Magazine.
Michelle Lee, Nylon Media’s former editor in chief and chief marketing officer, was brought in the same day that Wells was let go, to helm Allure. The new editor in chief is charged with bringing Allure into the digital age and extending its reach to Millennial women.
Lee is one of a handful of top editors who have been ushered in by Wintour. Others include Traveler’s Pilar Guzmán, Eva Chen of the now-defunct Lucky and Self’s Joyce Chang.
Alongside Sauerberg, Wintour has played a strategic role in shaping the editorial content of the company to skew digital.
The digital focus has begun to pay off. From December 2014 to November 2015, Condé Nast digital, which includes all its titles plus Reddit, has logged on average 84.6 million unique visitors a month, according to ComScore. This compared with traffic for the same period a year ago of 58.4 million, resulting in a 44.8 percent increase.
Santarpia, who has quickly risen in the company to the new role of president and chief digital officer from executive vice president and chief digital officer of Condé Nast Entertainment in October 2014, is charged with making a slew of digital hires in 2016, insiders said. Cost savings from recent layoffs will go in part to building digital efforts, which includes hiring editorial, video, mobile, social media and sales talent.
Condé’s executive team had already begun to signal a shift in direction earlier this year. Case in point: at Glamour’s annual editorial meeting in August, Wintour and ceo Townsend, who will remain as chairman of Condé, emphasized the importance of digital to the company as print readership wanes and moves to other platforms. The message that print editors would no longer simply focus on the magazine, but would have to become digitally savvy was underscored and punctuated by Gary Vaynerchuk, a kind of social media pooh-bah, who gave a motivational speech.
And in an e-mail to staff, Sauerberg expressed his own optimism for the company: “We are the home of the best pages, screens and experiences, and we will seize this time to grow these core, valuable assets, extend them onto more platforms and places where they can succeed, and strategically develop and acquire businesses that target new audiences and partners.”