Last fall, Meredith doubled down on print by buying Time Inc. from Time Warner. The move firmly established Meredith as the largest magazine publisher in the U.S.
It did something else too. It opened the door to break through the digital ad duopoly that has been hamstringing publishers and their digital ad revenue dreams.
“With Time Inc.’s digital properties on board, Meredith generates 170 million unique monthly visitors in the U.S., more than 10 billion annual video views and nearly $700 million in digital advertising revenue, according to the company,” writes Jeffrey A. Trachtenberg in the Wall Street Journal. “That scale, says [Meredith executive chairman Stephen] Lacy, will enable Meredith to better compete with Facebook and Google, which together command the lion’s share of new digital ad dollars.”
Lacy sees a future for Meredith that includes paid content (their 60 million subscribers form their second largest revenue stream) and the kind of robust advertising platform that ad partners are clamoring for.
“In all conversations with our major advertisers and marketers, they’ve said they want to do larger cross-platform deals with fewer players,” Lacy told Trachtenberg. “The ability to have a consumer audience that moves across all major adult life phases creates so many more opportunities. We now reach 200 million unduplicated consumers with 60 million unduplicated subscribers.”
Lacy, formerly the CFO for Meredith, is in the business to make money. Throughout the recent chaos in the industry, he’s been a stalwart believer in the power of print. Buying print magazines is, in his eyes, a smart business move.
“I have a lot of confidence in our longtime consumer connection. Then we built a digital business on top of that and never cannibalized our print business with the digital,” Lacy notes, reaffirming their “print proud, digital smart” mantra.
The brand also owns several TV stations, and that side of the business is growing well – but it comes with a downside.
“It’s a high cash-flow margin business,” he explains. “But you never own the brand. You have the pleasure of renewing your affiliation with the network every five years, and they take their bite from that apple.
“That’s not the case with People and Real Simple and Better Homes & Gardens,” he continues. “Those are owned-and-operated brands,” he explains.
The phrase “owned and operated” keeps coming up lately. We were just talking about this last week, as more magazine publishers look to a paid content strategy to atone for the original sin of giving away their biggest assets. For Meredith, creating a high-value ad platform for their partners – rather than Facebook or Google – makes good business sense.
Is it the end of the Facebook/Google duopoly? No, but it’s a start. Publishers are regaining their footing, reclaiming their space and getting down to what matters – high-quality content that their readers and the engaged audience that advertisers need.