The top performer on London’s main market this year has risen a whopping 200 percent year to date. If you had to guess what sector it’s in, you might say information technology, real estate, or health care, all booming sectors.
Actually, it’s in publishing – niche magazines, to be specific.
“The best performer on London’s main market this year is the publisher of Practical Caravan magazine. Shares in Future Plc — whose portfolio also includes Classic Rock, Retro Gamer and Airgun Shooter — have risen more than 200 percent in the year to date, giving it a market value close to £1.3bn,” writes Bryce Elder in Financial Times. “The stock’s latest high followed the announcement this week that it will buy peer TI Media for £140m. The deal will add to Future’s stable of titles including Country Life, TV Times and Horse & Hound.”
This wasn’t an overnight success, by any means. As Elder explains, the directors have been creating a name in niche publishing since 1985. But dropping subscription rates forced a change in the business model after a record low stock price in 2014. The turnaround came when the company began seriously leveraging its online real estate to make money.
“The unit is home to a hive of websites that are prime real estate for online advertising,” Elder continues. “Future also deploys proprietary software, called Hawk, that scatters live retail prices and ‘buy it now’ links throughout its online stories. Whenever the reader clicks through to make a purchase, the company takes a cut.”
Will the boom times continue? Elder remains noncommittal.
“Future may be the London market’s definitive boom-and-bust story,” he continues. “The stock has rallied more than 1,500 percent from its 2014 record low yet remains about 80 percent below its 2000 record high. Its latest rally is founded on a hope that the internet will at last deliver some of what publishers were promised two decades ago. Because this time it is different, right?”
Maybe they have cracked the code to successfully using their own platform and first-party data to drive revenue. As niche titles continue to grow in popularity, the audience base should be there too. Where Future has an edge is the fact that magazine brands offer a trusted platform where ads are a welcome part of the experience. If they can continue to provide quality editorial and relevant advertising to complement, they could give the digital duopoly a run for its money the same way Meredith is challenging the status quo.