Club & Resort Business, published by Westlake, Ohio-based , targets operations and management staff at country clubs, yacht clubs and semi-private or daily fee clubs. The magazine launched into what every magazine executive looks for: An attractive market underserved by existing media. Co-founders Dan Ramella and Bill Donohue (former Penton Media president and retail media division head, respectively) debuted the magazine in April 2005 to a controlled circulation of 28,000 club operators on the premise that a strong commitment to editorial content would lift the title to the top of its market. After a rough first year, the magazine bounced back, flirted at break-even, and is expected to achieve profitability in 2007.

Approaching the Green
"When we looked at this opportunity there were two unique elements to our approach," says Ramella. "We were going to cover the entire field and more importantly, we write to the entire constituent of the management team that runs these facilities, not just the GM or owner."

Ramella and Donohue also committed to a 64-page folio, no matter what. A risky move considering they were unknowns in the club and resort industry. "We had zero credibility. We had zero friends we could call on and say, ムHey, throw me a few pages,’" says Ramella. "So we laid it on the value of the product."

The fixed folio also helped lock in manufacturing costs, and made the projections that much easier to formulate during the business-plan stage. "Bill and I developed a financial model that was very conservative on the revenue line and fairly aggressive on the cost side," says Ramella. "We looked at what we thought would be a worst-case scenario over a five-year projection."

Donohue and Ramella declined to say how much capital they raised, but note that it came mostly from friends and family. The owners of the business, including Ramella, Donohue, the chief editor and the operations manager, have more capital invested than outside money;about a 70/30 ratio.

The magazine’s launch went well on the circulation side. "The fact that we achieved 70 percent request circulation within the first seven months tells you that the magazine struck a chord," says Ramella. However, advertisers had yet to be convinced. "We expected in the first year we’d do about $700,000," says Ramella, but the magazine did only $337,000.

Not all was lost, however. Despite a dramatic top line shortfall, the costs came in well under their projections, softening the loss, which, says Ramella, was less than half of the revenue shortfall. "In reality, we weren’t that far off on our projected loss," says Donohue. "The thing that we underestimated, pure and simple, was the ability of perfect strangers to sell a product that didn’t exist to perfect strangers after the selling season."

Eagles for a Comeback
The co-founders stuck to their plan and continued to promote their audience, the editorial and the research they did on the vendor market. "Dan and I were able, in our ability to get appointments, to say, ‘Hey, we’ve done research on your product category, we know your rough market share,’ and that got us in," says Donohue. "It also said to the market we were serious."

Next, they produced third-party research that verified readership. With more doors finally opening, the pair gradually increased their ad sales. In 2006, issues averaged 25 ad pages and the magazine closed in on $1 million in revenues. Ramella and Donohue project 20 percent revenue growth for 2007, and profitability.

Back at the Clubhouse
As Club & Resort Business gains solid footing, Donohue says they’ll examine opportunities for more products;whether organic or acquisition-based. "It’s not our goal to build our entire business around one magazine. We plan to build this over the next 10 to 15 years," he says.

Still, the magazine is the cornerstone of the operation, according to Ramella. "In any market, there’s still plenty of room for a quality print brand that resonates with its readers, and it’s still the foundation on which you build your e-media and your in-person strategy. Our experience over the last two years did nothing but verify that."


Fully Understand Your Market
You may have recognized an opportunity, but if you don’t understand what your readers and advertisers need, you have no chance.

Control Costs
Because Ramella and Donohue budgeted aggressively on costs, but kept them down, their loss on the top line in the first year was not so painful.