March 28, 2024

Media Decoder Blog: Martha Stewart Living Omnimedia to Lay Off Staff and Reduce Magazines

Martha StewartFernando Leon/Getty Images Martha Stewart

Like many New York companies, Martha Stewart Living Omnimedia had a difficult week. The basement of the company’s offices in west Chelsea were flooded by Hurricane Sandy, sending staff members home for the week and forcing the company to twice reschedule its quarterly earnings report, now set for Friday.

On Thursday, there was more bad news when the company announced it was scaling back two of its four magazines and laying off about 70 employees, or 12 percent of the nearly 600-person company.

Everyday Food, the company’s middle-market cooking digest, will be cut from 10 issues a year to five and will no longer be sold as a stand-alone publication. Instead, it will be delivered as a supplement to subscribers of Martha Stewart Living.

Whole Living Magazine, which the company purchased in 2004, is on the market. The magazine, with a circulation of 760,606, has suffered a 24 percent decline in advertising pages in the last year. While company executives say they are already in discussions to sell the magazine, they plan to stop printing it by year-end and fold its content into Martha Stewart Living if a sale is not concluded.

“It’s a significant event in the history of the company,” said David Bank, an analyst with RBC Capital Markets, about the publishing cuts. Unlike bigger publishing companies with dozens of magazines, Martha Stewart is now heavily dependent on only two titles, Martha Stewart Living and Martha Stewart Weddings.

“There’s really one flagship title carrying the operations. The magazine industry no doubt is headed for structural transformation,” Mr. Bank said. “But the bigger you are, the longer you can put it off for. These guys, they’re just subscale.”

The announcement follows a steady stream of bad news from the company, including declining income in all three of its divisions: publishing, merchandising and broadcasting. Last year, the company hired Blackstone Advisory Partners to explore what was considered a sale of the company and ultimately formed a merchandising deal with J. C. Penney. Earlier this year, the company cut $12.5 million in broadcasting costs by not renewing its daily programming deal with the Hallmark Channel, breaking its lease on its television production studio and ending its live audience for “The Martha Stewart Show.” In April, it was announced that a new weekly show, “Martha Stewart’s Cooking School,” would be distributed on public television.

The cuts announced Thursday go to the heart of Martha Stewart’s publishing business, the foundation of her company, which still provides 64 percent of total revenue, according to the latest public filings.

Lisa Gersh, the company’s president and chief executive, said, “We’re taking it really from four separate magazines down to two.” She added that the decision was driven by declines in magazine advertising and newsstand sales and the potential for greater profits in video. The company’s magazine titles have also attracted more digital subscribers than their competitors.

“In light of the clear trends we are seeing across the media industry, and following a careful evaluation of our own publishing segment, we are taking decisive action to drive the company’s return to sustainable profitability,” Ms. Gersh said.

The announcement will not change the relationship of Ms. Stewart herself with the company that bears her name. Last year, Ms. Stewart, who was convicted in 2004 and sent to prison for lying to federal investigators about a stock sale, was allowed to resume an official role in the company. In July, the company agreed to extend her current contract to June 2017.

The company’s publishing fortunes now rest heavily on magazines with very mixed results. Martha Stewart Living’s advertising pages declined by 30 percent in the first half of the year, according to data tracked by the Publishers Information Bureau. While its overall circulation has grown slightly, its newsstand sales dropped in the last year to 163,571 copies in June from 198,700 copies the same time the year before, according to the Audit Bureau of Circulations.

Martha Stewart Weddings has had more success with its advertising pages, which in the last year grew by 49 percent. Ms. Gersh said the magazine’s December issue was expected to be the biggest issue in terms of advertising revenue. But even brides have been buying fewer copies of Martha Stewart Weddings. Its newsstand sales declined to 155,406 copies in the first half of the year from 200,159 copies the same time the year before.

Even with these problems, analysts seemed pleased that Martha Stewart’s executives had finally made a move to cut its publishing costs. Michael Kupinski, director of research for Noble Financial Capital Markets, noted that so far this year the company’s publishing division generated a $12 million loss, while its merchandising division brought in $38 million in net income for the company. Last year, merchandising generated $30 million in net income, while publishing generated a loss of $6.5 million.

“All of the cash flow at the company is driven by merchandising,” Mr. Kupinski said. “It’s been a really tough environment for magazines.”

In a statement, company executives estimated that the latest publishing cuts would save $33 million to $35 million a year on staff, circulation and distribution.

These recent cuts may also put Martha Stewart in better shape for a sale. Mr. Kupinski noted that last year the company hired Ms. Gersh, who was involved in founding and making Oxygen Media profitable and then selling it to NBC Universal. It also brought on Kenneth West, former chief financial officer of Marvel Entertainment, who was involved with selling that company.

“There was a point it was for sale. But Martha wasn’t getting the price that she wanted,” Mr. Kupinski said. “If this management team comes in and at breakneck speed, they’re cleaning up this business, I wouldn’t be surprised at one point that it’s on the block.”

A version of this article appeared in print on 11/02/2012, on page B1 of the NewYork edition with the headline: Martha Stewart Living Will Scale Back Magazines and Reduce Its Staff.

Article source: http://mediadecoder.blogs.nytimes.com/2012/11/01/martha-stewart-living-to-lay-off-staff-and-reduce-magazines/?partner=rss&emc=rss

Media Decoder Blog: Baton Rouge Newspaper Sees an Opportunity in New Orleans

It’s a Hail Mary pass for New Orleans newspaper lovers dreading the day that the city no longer has a daily paper. Starting on Monday, the first day that The Times-Picayune no longer prints every day, The Advocate from Baton Rouge will offer home delivery of a New Orleans edition.

Many of the bylines in the paper will be familiar to readers there. The Advocate hired seven people who had left The Times-Picayune to staff its New Orleans bureau. The publisher, David Manship, whose family has owned the paper since 1909, said that The Advocate had not had a reporter in New Orleans since its correspondent moved back to Baton Rouge, some 80 miles to the northwest, during Hurricane Katrina.

In May, The Times-Picayune announced that it would scale back print production to three days a week and shift its emphasis to its free Web site, Nola.com. Widespread layoffs followed, and some longtime Times-Picayune employees left voluntarily.

Mr. Manship said the new edition would feature coverage of basic news beats like city government. He will wait to see how it is received before deciding whether to expand into areas like arts coverage.

“If this thing goes like we hope it would, then we would add some additional staff,” he said.

But The Times-Picayune is not taking this expansion into its turf lightly. Ricky Mathews, the president of the NOLA Media Group who on Monday will take over as publisher of The Times-Picayune, said that the company had been planning for six months to build its presence in Baton Rouge. He said the paper already had three reporters there but would now add 16 staff members to its Baton Rouge bureau — 12 on the editorial side and four on the sales side.

He said he welcomed the competition.

“We believe that competition is good and what we’ve got to do is serve this region really well no matter who it is,” Mr. Mathews said.

In New Orleans, the newspaper war has already begun. Starting on Monday, The Advocate has handed out 11,000 to 18,000 free copies throughout the city each day. Mr. Manship said more than 6,000 households had signed up for home delivery.

Both papers hope the changes will help with their declining circulation. According to data tracked by the Audit Bureau of Circulations, The Times-Picayune’s circulation from Monday through Friday declined to 134,639 in March, from 142,700 the same time the year before. The Advocate’s circulation from Monday through Friday declined to 76,263 in March, compared with 82,695 the same time the year before.

Mr. Manship said that the success of the New Orleans edition depended heavily on advertisers in that city.

“If the advertising community in New Orleans doesn’t support it, then I would have to rethink the whole thing,” he said. “If I don’t make money on it, as nice a guy as I am, I can’t afford to throw money into a hole.”

Article source: http://mediadecoder.blogs.nytimes.com/2012/09/28/baton-rouge-newspaper-sees-an-opportunity-in-new-orleans/?partner=rss&emc=rss

Start-Up Chronicle: Taking the Bait: Permits, Reservations, Drinking on the Job

Can't a restaurant owner drink at his own bar?Selin SemaanCan’t a restaurant owner drink at his own bar?

Start-Up Chronicle

Getting a restaurant off the ground.

Time to take stock. As always, many of the comments are more entertaining and insightful than the posts. Herein, we respond to the responders of the last month on scuffling for permits, canceling reservations, and drinking on the job.

Having owned my own establishment for 9 years, this question was always on the front of my mind. The sight of an owner who is over indulging at his own bar will cause irreversable PR damage. That being said, customers love to drink with the owner. — bobmartinelli, West Greenwich, RI

mr. martinelli,
This conundrum could drive one to drink.

Yes, smoozing is much easier after a glass or two of decent wine, but wouldn’t this apply to the staff also? Don’t the difficult customers, heat, chaos, etc. that your staff must deal with also seem a little easier with a glass or two? — SirWired, Raleigh, NC

SirWired,
The staff members do not schmooze. They follow 21 steps of service and deliver hot food and work on computers and tabulate money. In an air-conditioned space devoid of chaos. Not well played, Sir.

I have the feeling that your desire to be that guy (drink! chat! and get paid for it!) is the real reason you got in to the restaurant business in the first place. Which is, of course, why us restaurant lifers have given you such a hard time online. — J, Ga.

Dear J,Ga,
Your feelings are just that. I have never had the desire to be that guy. I am not getting paid. And that is not why I opened a restaurant. Lifers will have to find other reasons for the hard time.

The boss has to be clear headed when around, would you want your banker to be impaired during working hours. — jkl, NYC

jkl,
Could bankers do worse? You should visit Wall Street some day and witness the power lunches. God knows what they imbibe at night.

Emergencies happen at restaurants all the time, and even the chance of slightly delayed response time due to having a drink is simply not worth the risk. Your liability insurer would love to know this information, btw… — Karl, Melrose

Karl,
Having recently been cross-examined by a phalanx of insurance investigators, I can tell you that the one question no one asked was about my drinking habits. They were more concerned with the habits of the architect and the general contractor.

Comment 15, a wordy defense of drinking on the job that runs counter to the prevailing opinion of commenters and yet was mysteriously highlighted, sounds like it was written by Bruce. Who decides which comments to highlight? — Amy, Nevada

Amy,
You think I write wordy defenses of my own wordy blog posts? And then highlight them? You are oh for two. Hope you don’t gamble there in Nevada. (Highlights are chosen by the blog’s editor.)

Enforcing a strict rule for your staff while publicly violating it yourself in front of them is a perfect way to earn their dislike. — CDM, Richmond, CA

CDM,
I have found innumerable ways to earn dislike, but this one can be remedied. No more drinking for me — unless there is a very good reason.

Give those that make reservations and keep them a gift like an extra side or a special dessert creation. — jkl, NYC

JKL, NYC
OMG. Now we are giving away gustatory door prizes for people who actually keep their reservations? Next thing, free drinks for anyone who washes his hands.

Your story reminds of a quote from Randal in the movie Clerks: “This job would be great if it weren’t for all the customers”…It sounds like the only real problem is that it makes the evening more stressful/uncertain than necessary. — anonimitie, Jacksonville, FL

Anonimitie,
What nationality is that name? What? Oh. You’re not saying? One hundred last-minute cancellations affect everybody — the waitlisted who were not contacted, the guests who actually showed up, the kitchen, the bottom line, the whole kit and kaboodle.

It seems like this situation would be a great time to use social media–put out on twitter, facebook, etc when you have a cancellation. good luck! –
Josie, St. Pete/NYC

Josie St. Pete,
Thanks. Might give it a go.

Do you think it’s possible that this blog contributes to some of the reluctance people have to help you (mainly the inspector)? — Lizbeth, NY

Lizbeth,
Good question. For an equally good answer, I refer you to a fellow commenter, Brianvan, NY,NY, who writes:

Lizbeth: The buildings department in Southampton has a duty to provide permits to legal, qualified projects — and not to react to a permit seeker’s maturely-expressed opinions in a newspaper in the process of providing permits. Unless, of course, our small towns are run by immature, petulant, narcissistic adults who only perform their duties when the emotions of the situation suit them.

During the fire drill, were you able to sneak in and cut to the front of the line? — Michael, Washington, DC

Michael,
That was a fantasy. Never happened. Sorry I didn’t make it clear. Getting caught inside town hall during a fire drill may be punishable by burning at the stake.

Placing the blame for Bruce’s permit problems in Southampton and resultant loss of 50 jobs on pro-regulation liberals would be like placing the blame for a global financial crisis and resultant deep recession on anti-regulation conservatives…oh, wait… — MrB, Chicago

MrB,
I’ll take care of the sarcasm around here. May I have my name back, now?

From 400 miles away, this smells so much like an atmosphere that ripe with graft. A building inspector that points out that a wall that was already approved is suddenly illegal? Plans that suddenly appear that didn’t exist? General attitude of a Catch-22 runaround? — MikeSlade, Rochester, NY

Slade,
Joseph Heller lived in East Hampton. I wish he were around to consult.

I was amazed during our store’s construction process the difference that an expediter made. I didn’t want to pay it – seemed like an unnecessary cost, but man, was I wrong about that. — Rebecca, Brooklyn, NY

Rebecca,
Welcome to the party. In many communities, a good and fairly priced expediter is as essential as hammer and nails.

Hopefully what Bruce has shared will help other business owners to talk with someone who has done it before, and hire the right people to expedite or complete tasks and manage relationships with third parties … — Chris, Elizabeth NJ

Chris,
From your keyboard to business owners’ eyes.

It’s naive to think the majority of our local, state, or federal governments will act entrepreneurially because they aren’t entrepreneurs. — chapman

Chapman,
Act entrepreneurially? How about logically or efficiently?

Plan an off season event for locals that some of the beauracrats might attend and enjoy. I’m a resident of a resort area year around and locals can spot locals, and locals get better treatment. — Dan, Washington State

Dear Dan,
I have 33 years that say I’m a local. When a planning board member recently ate at the restaurant, she said, “Had I had known this place would be this nice, I would have been less intransigent.”

Bruce Buschel owns Southfork Kitchen, a restaurant in Bridgehampton, N.Y.

Article source: http://feeds.nytimes.com/click.phdo?i=5453aae04fdd1ee67c23cdf200d88f92

Economix: Answering Questions on Leadership

Adam Bryant, who conducts interviews with chief executives and other leaders for Corner Office, a weekly feature in the Sunday Business section and on nytimes.com, answered questions posed online today on Quora, a site devoted to curating knowledge collaboratively. Mr. Bryant is a deputy national editor whose previous assignments included coverage of the auto and airline industries. It was the last of three weekly sessions on Quora featuring Times staff members. Read more

Article source: http://feeds.nytimes.com/click.phdo?i=14be9e71af6a1c0c94feaee572639927

After a Rocky Five Years, Talk of Couric Parting With CBS

Regular appearances on “60 Minutes” were written into her $15 million-a-year contract with CBS, but once she arrived at the network, she found a chilly reception from some of the staff members at the venerable program. Some of Ms. Couric’s associates said that the chilliness seemed to stem from the top, the show’s executive producer, Jeff Fager. That view was disputed by people close to Mr. Fager, who said that Ms. Couric has praised his stewardship of her “60 Minutes” pieces.

Still, her appearances on the show have been fewer than she hoped for — averaging not even five a year. Even after the show won an Emmy for her interview with the airline pilot Chesley B. Sullenberger III, Ms. Couric’s visibility on the program never increased.

“They never let her learn the secret handshake there,” said one former NBC colleague.

In February, when Mr. Fager was named chairman of CBS News, his tepid response to the hugely public question of whether she might continue as anchor (Mr. Fager said he hadn’t thought about it yet) sent an additional signal to Ms. Couric and her representatives: it was time to move on.

Ms. Couric and CBS are now negotiating how and when to end her five-year run as anchor, one marked by early criticism, later journalistic successes and disappointing ratings over all.

Ms. Couric is pursuing the idea of her own syndicated talk show, possibly with her former “Today” show co-host, Matt Lauer.

Any such move would be intensely complicated. Mr. Lauer’s contract extends to the end of 2012, while the new show would be expected to start in September. And NBC can be counted on to make perhaps the biggest offer in television news history to keep him at “Today.”

But some people close to the participants conceded the notion had been “thrown around” between the former hosts — and is under serious consideration.

The linchpin in any new show pairing Ms. Couric and Mr. Lauer is Jeff Zucker, who before he was NBC’s chief executive put the two hosts together as executive producer of “Today.” Mr. Zucker had already been expected to be the main creative force behind a talk show with Ms. Couric.

“I think the three of them think it would be awesome to get together again,” one person close to the negotiations said. “It still seems more likely NBC will keep Matt. But it’s not out of the question.”

Even if a reunion with Mr. Lauer does not happen, Ms. Couric is all but certain to commit to the syndicated talk show and leave CBS News.

Almost none of the participants in the discussions about Ms. Couric’s future were willing to be interviewed about her tenure at the anchor desk while talks were continuing. But interviews with producers, network executives and friends of Ms. Couric (most of whom would not speak for the record because they did not want to alienate either the network or Ms. Couric) show that her celebrated hiring was part of a much larger experiment to lift the newscast out of the ratings basement in which it had languished for more than a decade.

For years, network news managers have tried to poach viewers from competitors by adding incremental features. Looking at the steady decline in the evening news audience — down more than 50 percent in the last 30 years — CBS believed its best, maybe only, hope was to throw out the traditional format and attract new viewers with a more interactive and accessible half-hour built around Ms. Couric.

“What we tried to do was change the game,” said Rome Hartman, the first executive producer on Ms. Couric’s newscast. “We tried to grow the whole pie.”

In an interview in the current issue of The New York Times Magazine, Ms. Couric acknowledged being “overly ambitious” and said that in retrospect she would have “given people what they were used to, a traditional newscast” before experimenting with new concepts.

Article source: http://feeds.nytimes.com/click.phdo?i=01cc1cde900bb1ec4dba1162ba5f453c