Building Muscle
POSING FOR a portrait in his company’s lavish Woodland Hills, CA lobby, Michael Carr, president and CEO of muscle-mag publisher Weider Publications, briefly experienced an awkward moment.
Carr stood before Weider’s two-story indoor waterfall, attempting a casual arms-across-the-chest stance. An observer suggests he flex his biceps, bodybuilder-style. Carr, who expresses his confident personal style in gold rings and Italian loafers, for a moment looked distressed. “I’m more of a ‘before’ type,” he joked.
In a direct marketing sense, the same might be said of his company. Long known as a heavyweight on the newsstands, Weider Publications-publisher of Shape, Flex and Muscle & Fitness-has been equally known as featherweight in subscription circulation, ancillary product marketing, database development and other staples of DM. Until 1990, in fact, the company didn’t even send out a single direct mail piece to solicit subs.
Now, according to Carr, the company is at last starting to flex a little direct muscle. True, the current emphasis is still on “little”: In the past year, Weider’s major DM thrust has been in refining list selections and direct-mail offers for the company’s more mainstream titles-Shape, Men’s Fitness and teen book Jump.
Nevertheless, Weider executives have begun speaking boldly of newsletters, books, spinoff titles, Internet ventures and other direct marketing initiatives. To bring them to life, moreover, Carr 10 months ago hired Bobbi Gutman, a well-regarded circulation veteran of Playboy and Marvel Comics.
What’s taken the 48-year-old company so long to get here? The short answer is this: For the most part, says Carr, Weider simply hasn’t needed direct marketing in order to make money. When it comes to profits, nobody’s been kicking sand in Weider’s face, largely because two-thirds of the company’s readers, overall, pay full cover price for their favorite Weider titles at the newsstand. ((According to Carr, Weider Publishing has about $112 million in revenues, with a net income of about 8%.)
“Our priority,” says Carr, “was, let’s have a solid base of magazines first, with loyal readers. We’ve been focused on solidifying our readership base. Now it’s time to expand.”
>From one perspective, however, a direct marketing move seems long overdue.
Consider, for instance, that the company’s eight titles-which also include Senior Golfer, Natural Health and Fit Pregnancy-all share a common readership of fitness enthusiasts. Now consider that Weider Publications is owned by the same holding company (Weider Health & Fitness) that is also majority shareholder in the $218 million supplement-products company, Weider Nutrition.
The cross-marketing possibilities would seem endless. Here are some four to five million exercise buffs, weaned on the Weider brand, and ripe for a series of Weider books, newsletters, infomercials, supplement samples, coupons, product catalogs and activewear.
There’s just one problem with that DM nirvana: none of those products exist. Yet.
One reason is that, currently, Weider knows little about its readers and supplement buyers. Nearly all the Weider supplements, for instance, are distributed to retail stores, gyms and health-food outlets, where they’re then sold over the counter. Result: no customer data.
Weider Publications also lacks impressive subscriber data. Its active buyer database contains only about 1.5 million names, about one-third of its total customer base. Moreover, that database includes everyone from 60-year-old golfers to 16-year-old girls to young men with arms like canned hams. (By contrast, most magazines, industry-wide, sell more than 80% of their copies via subs.)
For the sake of “credibility,” Carr says, Weider has also taken care to separate its supplement business from its magazine business. Even if they had it, says Carr, the two companies would not trade buyer information.
Right now, cross-promotion between the two Weider companies largely consists of sweetheart ad deals, editorial product endorsements by Weider-paid bodybuilders, and occasional subscription cards tucked into supplement product packs.
Circulation-wise, the company has proven almost phobic about direct mail.
Recently, for instance, Weider suspended two titles, xx-year old Living Fit and xx-year-old Prime Health and Fitness. Both magazines had been geared to aging boomers seeking fitness; neither magazine, according to Carr, proved economically viable. “The fact is,” he says, “there is yet to be a [magazine] specifically targeting baby boomers that’s been successful.”
Some observers, however, say Weider simply didn’t promote the titles, particularly through the mail. “They didn’t do diddley-squat,” says a former staffer for the company. And interestingly, Carr doesn’t deny it.
Both magazines, he notes, relied on the newsstand for about half their circulation’s (Living Fit sold about 300,000 total copies per month; Prime, about xxx,000).
The way this company has seen it, direct mail’s cost has far outweighed its gains. When it comes to revenues, most of Weider’s titles have been circulation-driven, not ad-driven. Therefore, the company’s goal has been to make money on every reader, something that’s hard to achieve with discounted sub offers.
“Until 1990, the only way to get a subscription was through a tip-in card, cash with order,” Carr says. Since then, Weider has kept the subscription prices high-12 issues of Flex, for instance, cost $30-and the direct mail effort low, preferring to attract those full-price single-copy readers.
“We don’t launch magazines with huge subscription campaigns because you don’t know how well they’ll do,” Carr says. “We’re not a company that blows $25 million to find out if there’s a good idea there.” As opposed to pricey direct mail drops, he points out, newsstand sales offer “limited exposure and maximum credibility.”
To be sure, however, Weider now appears ready to rethink some of its policies. For one thing, today’s crowded newsstands are no longer the comfort zones they used to be. Muscle & Fitness, for instance, now sells 60% of its copies on the newsstand; in 1993, it had sold 75%. Shape, likewise, has declined from 62% single-copy sales to 55% over the same period.
“[Weider] has always had nice newsstand sales numbers,” says Dan Capell, TITLE, Grupo, Levy, Capell, “but, like everyone else in the industry, they’ve been heavily impacted.”
In addition, Weider has needed to build up its presence in the mainstream fitness world, one inhabited by powerhouse competitors like Rodale’s Men’s Health and Conde Nast’s Self. Generally speaking, those competing titles carry the consistent, subscription-driven reader numbers that advertisers prefer for maximum reach.
Weider also has needed direct mail expertise for Jump, its xx-year-old teen publication that’s already cost the company $10 million-plus in launch costs. At only 350,000 circulation, Jump is still a long way from the leagues of Teen, YM and Seventeen, all of which boast well over a million paying readers.
Weider’s first change in strategy, then, was in hiring Gutman, who’d spent x years at Playboy building up the subscription and licensed product division. “She’s very highly thought of, very experienced,” says Capell.
Adds Cindy Rakowitz, Playboy’s vice president of public relations, “She’s one of the smartest women I know in business.” Given Weider’s relative DM inexperience-and the fact that Gutman had worked with Carr at Playboy, where he was advertising director-“It’s a good match,” Rakowitz says.
Gutman would agree. “Having been at a number of big magazines,” she says, “you rarely come to one that hasn’t been tapped out on the direct marketing side.”
Since her hiring, Gutman has spent much of her time closing the gaps in Weider’s marketing strategies. Prior to her arrival, for instance, Weider had uncharacteristically sunk $1 million into a TV subscription campaign for Jump. Gutman noticed that well over half the respondents had signed up for a two-year-offer. That might bode well for, say, The New Yorker, but it seemed suspicious behavior for teen-age girls. “I suspected they were really sampling the offer, and that that would lead to high bad debt,” Gutman says. She decided to pull the campaign. “Sure enough,” she says, “that’s what we’ve experienced.”
Meanwhile, Gutman has been working to “leverage the subscription side” for Shape, Men’s Fitness and Jump. Without giving details, she notes the company is testing offers, packages and creative, in addition to trying new name sources. Clearly, there’s a two-fold benefit to that: Not only would subscriptions boost the magazines’ circulation numbers, they would also boost the still-fledging customer database.
That brings up a second task: ancillary product development. In that regard, “There’s a tremendous opportunity on the print side,” Gutman says.
Because of Weider’s franchise in health and fitness, she notes, magazines, newsletters and books would prove a natural fit. Later on, the company might explore other kinds of brand-expanding opportunities, much the way Playboy put its name on T-shirts and lingerie. “There are hundreds of ideas we have,” she says, “but Weider brings credibility as an information provider, as opposed to a provider of athletic wear.”
That credibility, the company hopes, should also prove a good fit on the Internet. Weider’s current site, Fitness Online, earns about five million page views per month, and gathers some reader data through contests and product sales. The bigger payoff, though, should come from the company’s recent joint venture WHEN with XXXX to sell supplements and vitamins directly over the Web. Given Weider’s brand name and wealth of nutrition data, the intent, says Carr, is to become “the preeminent retailer of nutrition over the Web??”
Sounds good so far, but compared to publishing companies like Petersen and Rodale, Weider is still in direct marketing basic training. At thispoint, cross-marketing, couponing, loyalty programs and ancillary products are still more in the talking stages than the action stages. “I always wondered why they didn’t do more,” says a former staffer.
It’s possible that Carr’s own philosophy explains the dilemma best. Weider Publications, he says, is set up to do two things: “Make money, and do it while providing a good experience for consumers.” Given that Weider never lost money on with its old habits, it’s no wonder the direct marketing habit has taken a while catch on.
