AMI Buys 13 Celeb, Teen Titles from Bauer; Bauer to Focus on First for Women, Women's World
Forbes: American Media Inc. (AMI), publisher of National Enquirer, Men's Journal and Us Weekly, "announced today that it has acquired 13 brands from Bauer Media USA, including the celebrity titles In Touch, Closer and Life & Style, and nine brands from the Bauer Teen Group. Not included in the deal are the two best-selling magazines on the U.S. newsstand, Bauer's First for Women and Women's World, although In Touch was the seventh-most popular newsstand title in the second half of last year, according to data from the Alliance for Audited Media. With the acquisition, AMI nearly corners the market on the celebrity-magazine category. In addition to Us Weekly, and now In Touch, Life & Style and Closer, it owns Star and OK. Meredith's People remains the category's behemoth. AMI said in a statement that it secured bridge financing from existing investors to fund the acquisition, which would close around the first of July. After that, the statement said, it will refinance its existing debt. The Bauer titles--including the Bauer Teen Group, including J-14 and Girls World--will become part of the AMI Entertainment Group. Combined, the statement said, the new AMI Entertainment Group will reach 38M readers and deliver the youngest median age in the category. Newsstand sales will average 1M copies weekly with less than 25% reader duplication. 'Today’s announcement underscores AMI investor confidence in our business strategy as we continue to build and grow our Entertainment Group,' said AMI CEO David J. Pecker. 'Despite newsstand sales declining 20% annually, both Bauer and AMI have continued to invest in the marketplace and we believe there is still a terrific opportunity to grow newsstand revenue.' AMI has been on a buying spree, acquiring Us Weekly for $100M and Men's Journal, both in 2017." Folio: "A joint statement from the companies says that Bauer will focus its U.S. efforts on its women’s titles, First for Women and Woman’s World, among others, an area in which Bauer says it maintains a 'lead position.' Regardless, the move represents a significant step back in the U.S. for the German-based company, in a year that’s already seen the mergers of Hearst Magazines and Men’s Health publisher Rodale; Time Inc. and Meredith Corp.; and the effective dissolution of the aforementioned Wenner Media... 'Under AMI’s leadership, we believe the celebrity and teenage and kids titles will continue to succeed at delighting their audiences,' said Steven Kotok, CEO of Bauer Media USA, in a statement. 'With this deal, Bauer USA will focus entirely on building on our leadership position in women’s service.'"
MBR Conference: ‘Leveraging Everything’ Initiative Gathers Momentum, Part 2
Tim Humanik, SVP at national distributor CMG, reported that publishers and their distribution channel partners have already been incorporating elements from MBR's “What If We Leveraged Everything Magazines and Books Have to Offer?” presentation template — as well as real examples of innovative retail magazine and book partnerships that have been implemented — in actual recent presentations to retailers. (See "Part 1," from yesterday's MBR Daily News, for an explanation of the template and its purpose.)
Meredith's Strategy for Upping Revenue from Time Inc. Assets
Digiday: "Now that it’s bought Time Inc., Meredith is focusing on wringing more revenue out of Time Inc. titles. This week at the Food & Wine Classic in Aspen, Colorado, a team of seven writers, producers and videographers has been holed up in a house paid for by San Pellegrino, churning out branded content for advertisers from Patrón Tequila to Microsoft.The Classic has always been sold as one of the crown jewels of Time Inc.’s events, but this is the first year that Food & Wine’s editors used it to generate content for brands or editorial use. That capability brought in dollars from new and existing advertisers, including KitchenAid. '[The Classic] is a gold mine,' said Hunter Lewis, Food & Wine’s editor-in-chief. 'The strategy is about maximizing the value of what we’re doing.' Other titles are working with advertisers in new ways. Next week, Real Simple will launch a cooking school video series on Facebook Watch that brands can pay to place products in. This summer, Real Simple will launch a new shopping section on its site featuring Real Simple-branded products and others picked by its editors. In the fall, it’s launching an apartment in Brooklyn called Real Simple Home, which will be used to model design ideas, throw events and generate editorial content. The goal is to grow the titles’ overall revenue, but especially digital, through new and existing ad programs. Titles like Real Simple still get fully 70% of revenue from print advertising. Real Simple publisher Daren Mazzucca would like it to be closer to 60%, while still growing overall revenue.“Our whole mission here is pretty simple: Outperform the market,' said Doug Olson, president of Meredith magazines. 'Everybody is an integrated seller now. It just matters to what degree.' Meredith assigned dedicated publishers to Time Inc. titles, reversing Time Inc.’s maligned category-specific sales strategy. Olson said the move to dedicated sellers, which was finalized in March, will help the company monetize the magazines and their big events like the Classic.The new ownership’s focus on delivering return on investment for clients is getting noticed. Ashley Bahlmann, svp of group media at Cramer-Krasselt, said that since Meredith acquired Time Inc., the RFPs she sends to clients have come back with more details on how a proposed campaign would meet the client’s business goals."
Trusted Media Brands Names Jason Sinclair V Marketing
Trusted Media Brands announced that Jason Sinclair to the new position of VP, marketing for the company effective June 19, 2018. He will be based in the company’s offices on Third Avenue in New York City, reporting to Zach Friedman, chief revenue officer. Sinclair most recently served as executive director, digital marketing for Meredith Corp., where he was a strategic marketing leader for the Foundry, the company’s state-of-the art digital lab and custom content studio within its digital advertising group.
Opinion: Amazon's Duopoly Challenge Will Benefit Online Publishers
In MediaPost, Ivan Ivanov, COO of PubGalaxy, writes in part: "Amazon is fast becoming a sizable advertising force; just last year, per eMarketer, its U.S. digital ad profit more than doubled, reaching $2B. It is expected to reach $3.19B by 2019. Moreover, WPP--the world’s largest advertising company – channeled $200M in client ad spend to Amazon in 2017. It is due to increase that share to $300M this year. Tellingly, Amazon has also, per Bloomberg, stopped buying ads on Google and started enhancing its own international resources. It's clear Amazon is upping its ad game, causing concern to the duopoly. Yet as Google and Facebook brace themselves for a battle, the wider industry may have reason to celebrate. Amazon’s challenge opens multiple doors for smaller publishers that have previously struggled to compete. For starters, it raises awareness among brands of viable advertising environments beyond Facebook and Google. So far, many businesses have chosen the duopoly for advertising needs because they are known quantities with solid brand positioning, not because they provide the best solution. Amazon’s rise disrupts such autopilot activity and encourages flow away from the duopoly. Second, Amazon’s threat presents the perfect opportunity for small publishers to take advantage of interest in alternative ad space, and showcase the benefits of their own platforms. For example, niche publishers often have a devoted following of readers and cover unique topics, which can be marketed as a chance to reach highly-engaged, precise audiences with targeted offers, such as limited-edition football boots for committed sports fans 16-24. All in all, there is an increasingly lucrative opportunity for smaller publishers to contend with the big players in the ecosystem; some may even be inclined to form consortia to increase the force with which they tackle the duopoly. The advantages of Amazon’s rise to power aren’t restricted to publishers. When it comes to advertising on the site, Amazon’s halo effect of organic sales through suggested products, product combinations and add-on items offer advertisers exponential circular growth. As trust in Amazon grows, so will the ROI advertisers can expect. Equally, the larger Amazon’s portion of ad-spend, the less the duopoly can glean, leveling the playing the field for advertisers. At a general level, advertisers can also leverage a wider world of choice. By casting their net past the duopoly to include Amazon and other publishers who don’t conform to its ad rules, they can enhance campaign scale and diversity.
Facebook Won’t Exclude News Publishers From Political Ads Policy
Adweek: "Facebook head of global news partnerships Campbell Brown explained in a blog post why news publishers will not be exempted from the social network’s recent introduced policy on political ads. Facebook announced last month that all election-related and issue ads in the U.S. on both Facebook and Instagram must now be clearly labeled, including disclosures at the top of the ads revealing who paid for them. The social network also revealed in May that it created an archive that is available globally and will contain ads and political issue content run by advertisers for up to seven years from the day they run, along with information including the campaign budget associated with the ad and how many people saw it (as well as their ages, locations and genders). Brown wrote, “Many publishers have welcomed this approach and welcomed our commitment to transparency around their ads. Some publishers have asked for an exemption from this new process. Removing an entire group of advertisers—in this case, publishers—would go against our transparency efforts and the work we’re doing to shore up election integrity on Facebook. We don’t want to be in a position where a bad actor obfuscates its identity by claiming to be a news publisher and, what’s more, we know there can be editorial content from news organizations that takes political positions. For these reasons, we’re focused on the separate archive treatment, without exemptions'"...
Report: FBI May Be Looking Into U.S. Media Trading Practices
MediaPost: "Campaign reported Thursday that the Federal Bureau of Investigation may be looking into shady media trading practices that might run afoul of the law.There wasn’t a lot of detail in the story, but it made clear that the purported FBI probe is separate from the investigation that the Department of Justice launched a while back looking into commercial production practices and potential bid rigging by agencies. The publication cited “multiple” but unidentified sources for its story on Thursday.The DOJ probe began in late 2016. Separately the ANA released the results of its own investigation into commercial production practices last year, finding that some bid rigging did occur. But it also found that advertisers were at fault for not adequately stewarding the production process for their ads. The ANA commercial production report followed a separate investigation and report commissioned by the trade group (K2 Intelligence did the legwork) looking into media agency trading practices like taking rebates from media companies and not informing clients. That so-called “Media Transparency Report” sparked controversy for its conclusion that media rebates — often undisclosed — is a common practice in the U.S. Critics were disturbed that the report did not name a single entity involved with the alleged transgressions.It’s not clear what, if any, connection the purported FBI probe has with the ANA/K2 investigation. However the DOJ did contact K2 regarding its commercial production investigation, as the latter also did spade work for the ANA on that issue.The major holding companies declined to comment yesterday or did not respond to queries for comment. On background, however, one major group said that neither it nor any of its agencies had been contacted by the FBI"...
Cartoonist Critical Of Trump Fired From Pittsburgh Newspaper
HuffPost: "A veteran editorial cartoonist for the Pittsburgh Post-Gazette was fired Thursday after he and the newspaper’s management clashed over some sketches critical of President Donald Trump.Rob Rogers, a Pulitzer Prize finalist who had been with the Post-Gazette for 25 years, announced his own ouster on Twitter. Earlier this month, he’d revealed that he was working through “unresolved” issues with the paper’s leaders over certain cartoons that they’d declined to publish. 'I knew in March,' when he said the paper first started rejecting his cartoon drafts and ideas without explanation, 'that we were headed for some kind of a compromise or a showdown,” Rogers told HuffPost. “I didn’t know what it was going to be, but it turns out it was a showdown.' The Thursday meeting in which he was fired, Rogers said, was the last of several he’d had with the HR department since the paper’s editorial director, Keith Burris, began cracking down on his cartoons. Since March, the Post-Gazette had axed 19 of his cartoon drafts and proposals without explanation, Rogers said. Over the course of a typical year, he noted, only a couple of his submissions would be rejected. Rogers’ concerns mounted when he said the paper rejected six of his ideas in a row starting on Memorial Day, including one that depicted Trump laying an R.I.P. wreath before a tomb reading “Truth, Honor, Rule of Law” and another showing the president separating undocumented immigrant children from their parents"... Article includes examples of censored cartoons.
OTHER NEWS OF NOTE:
Market Force: Wegmans Is Favorite U.S. Grocer
MNB reports that Market Force Information "s out with its annual survey of the nation’s favorite grocery retailers, ranking Wegmans at the top of the list, followed by Publix, Trader Joe’s, Aldi, and H-E-B. According to the study, 'This is the third consecutive year that Wegmans has ranked first in the study, after unseating long-running favorite Trader Joe’s in 2016. Wegmans held on to the top spot with a score of 77% on Market Force’s Composite Loyalty Index. Publix, which has consistently ranked well in the annual study, is a close second with a score of 76%, followed by Trader Joe’s with 75%. ALDI moved up a slot from last year to land in fourth with a score of 70%, and H-E-B rounded out the top five with a repeat score of 69%. Whole Foods landed in the middle of the rankings with 60%, while Safeway and Walmart ranked at the bottom with 42% and 34%, respectively.' In more specific categories, 'Publix and Wegmans tied for two key ones--store cleanliness and item availability. Wegmans once again ranked first for its specialty department service, while Publix was the clear leader for ease of finding items. Trader Joe’s was found to have the fastest checkouts.' One interesting finding: '15% of study participants have tried a meal kit delivery service at least once (up from 11% in 2017); however, nearly half (49%) were less than satisfied with the experience… Hello Fresh overtook Blue Apron as the most popular meal kit service, with 39% indicating they’ve tried it … Home Chef was a distant third with 9%. However, 83% who tried a meal delivery service have stopped using it (up from 76% in 2017), primarily because of poor value, but also due to portion size and cost. Home Chef once again has the highest satisfaction rating and the lowest customer churn, along with Plated.”
Sam's New Small Concept to Stress Tech, Fresh, Grab-and-Go
RetailWire: "Sam’s Club announced plans to open a new smaller store concept that’s big on tech, fresh foods and grab-and-go meals. Jamie Iannone, CEO of SamsClub.com and EVP membership and technology, writing on a company blog said the new club in the Lower Greenville neighborhood of Dallas is intended to help Sam’s improve the shopping experiences it offers its customers. The new store, which measures 32,000 square feet vs. the typical 100,000 to 150,000-sq.-ft. club, emphasizes the use of tech with digital signage throughout the store and cashier-less checkouts using Scan & Go. The club, which will carry between 1,000 and 2,000 SKUs, will offer self-serve returns, home delivery options and same-day pickup for online orders. Sam’s has been expanding its club pickup service this year. At Shoptalk in March, Iannone said the service had been added to 60 clubs with plans to have 100 completed by the end of the year. While Sam’s has offered pickup for years, the new version includes access to the full assortment of merchandise at the club, an enhanced mobile app and a designated area adjacent to the club’s entrance for pickups, which can be completed in as little as 30 seconds. Iannone’s post doesn’t mention plans to test similar smaller clubs beyond the Dallas location. In other Sam’s news, the retailer has opened its first repurposed e-commerce fulfillment center in Memphis. It's part of the chain’s plan to open a regional network of similar facilities that will offer quick and free shipping (for most items) to club members. Earlier this year, Sam’s closed 63 of its traditional clubs with the announcement that it planned to convert some of them into warehouses to handle fulfillment of online orders."
Kroger Rolls Out Brand Loyalty Program Across 121 Stores
PG: "Kroger has launched a program in collaboration with Alliance Data Systems’ LoyaltyOne business BrandLoyalty. Rolled out on May 2 of this year, the eight-week promotional campaign is featured at 121 of the Cincinnati-based retailer’s stores across the Mid-Atlantic region, encompassing North Carolina, Ohio, Kentucky, Tennessee, Virginia and West Virginia.The partnership between BrandLoyalty and Kroger aims to grow sales by increasing customers, basket size, and frequency of shoppers through the incentive-based short-term promotion. “We’re excited to have the opportunity to work with Kroger on this program that will leverage BrandLoyalty’s combination of expertise in loyalty programs, analytics and retail industry knowledge in order to drive sales, boost profitability and build customer loyalty in the highly competitive grocery segment,” said Bryan Pearson, president and CEO of Toronto-based LoyaltyOne, which has created customized loyalty concepts for some of the largest food retailers worldwide"...
Amazon Building a Whole Foods Bench
MNB: "CNBC reports that while Whole Foods’ founder John Mackey remains in charge of the company a year after it was acquired by Amazon, Mackey is decidedly not in control 'of the integration or the future of the business.' In fact, the story says, an organizational chart shows that 'far from letting Mackey run Whole Foods as an independent operation, Amazon CEO Jeff Bezos is stacking the business with veterans of the e-commerce company who can weave the grocery chain's 484 stores into his broader vision for the future of physical retail'"...
Nielsen: Fresh Categories Drive Almost 50% of Dollar Growth
PG: "Nielsen’s latest Total Consumer Report has found that fresh categories are driving nearly 49% of all dollar growth across fast-moving consumer goods (FMCG), with fresh and perishable foods generating more than $177B in sales. Although fresh categories are performing well in brick-and-mortar locations, the sector still has some room for improvement, according to the June 2018 report. Some findings: A year after the merging of Amazon and Whole Foods, e-commerce within grocery continues to grow, but is still maturing. In the past year, online food and beverage sales represented 13% of the overall dollar volume seen online. While e-commerce will be a bright opportunity for the future, marketers looking for growth opportunities today shouldn't be blind to the opportunities living in the perimeter of the store. Fresh and perishable foods generated sales nearly 14 times as high as all online food and beverage sales this year. Other findings: On-the-go fresh produce fails to keep pace with clean snacking. In the burger battle, frozen is still winning, but fresh is catching up, and alternative protein growth remains strong... The data for this latest Total Consumer Report leveraged Nielsen's new Total Food View, which for the first time, gives companies visibility into in-store competition and opportunities inclusive of UPC and fresh random-weight products beyond the bounds of a specific category or aisle"...
Competing for Amazon HQ2 Costing Cities in Money, Lost Opportunities
MNB cites a Wall Street Journal report that 'time, money and potential lost opportunities...are at stake as finalist cities and states compete ferociously' to be the site of Amazon’s second N.A. HQ, which could bring with it an estimated $5B investment in the winner’s local economy. In addition to financial incentives, the story says, 'cities and states have spent hundreds of thousands of dollars on site-selection consultants, quirky stunts and highly produced videos and graphics to win Amazon’s attention. Economic-development agencies can be privately or publicly funded, or some combination of the two. Some tapped private funds to help finance their HQ2 pitches... The time, money and projects that had to be set aside to focus on HQ2 proposals are the result of a highly unusual and public bidding process that some site-selection experts say puts too much pressure on cities to compete.' Amazon got 238 initial applications, whittled that number down to 20 finalists, and has visited all those locations as it goes about making its final selection. It has said it is looking for a diverse workforce, a strong educational component, an efficient public transportation system and access to a quality airport.The finalists are: Atlanta, Austin (Texas), Boston, Chicago, Columbus (Ohio), Dallas, Denver, Indianapolis, L.A., Miami, Montgomery County (Maryland), Nashville, Newark, New York, Northern Virginia, Philadelphia, Pittsburgh, Raleigh (North Carolina), Toronto (Canada), and Washington, D.C. Amazon has said that the 19 places that don’t get HQ2 'will be considered for additional projects, including warehouses or data centers that could create thousands of jobs.' Some of the cities that didn’t even make the finalists list have said that the process was a positive one since it allowed them to focus on what attributes would attract a progressive, growing technology company, and then get valuable feedback from the best of the breed.
Lawsuit Challenges End to Seattle's Head Tax
MNB cites a Seattle Times report that "three trial lawyers have sued the city of Seattle, arguing that its recent special meeting and vote to repeal a “head tax” were essentially illegal because they took place without sufficient notification and public debate.The “head tax”--$275 per employee per year, levied against the city’s largest businesses, including Amazon and Starbucks, which were not amused--was said to be designed to generate funds that would be earmarked the city’s homeless crisis.However, within hours of the suit being filed, 'an anti-tax campaign submitted the required signatures for a citywide referendum asking voters to repeal the measure, if necessary.' The signatures were submitted about an hour before the deadline for getting on the November ballot. 'Out of an abundance of caution, the No Tax on Jobs Coalition decided today to file our nearly 46,000 petition signatures,” John Murray, a spokesman for the campaign, said in a statement. 'Submitting the signatures ensures that we are on record regarding the jobs tax repeal. We remain committed to working together with the Mayor and the City Council on homeless and housing issues.'"
OTHER NEWS OF NOTE: