B-to-B vet Harry Stagnito is on his fourth launch in 20 years.
After Ascend sold the Stagnito group to BNP Media, Harry Stagnito [pictured] and sons Kollin and Kyle and associate Ned Bardic, determined to go out and buy another company to relaunch the Stagnito brand. ‚ÄúWe looked at a bunch of things for a year and a half, right in middle of the crush when media was starting to go backwards,‚ÄĚ says Stagnito.
The Stagnitos‚Äô return to publishing followed Harry‚Äôs original strategy of acquiring and then reviving distressed products. In early 2009 he bought Zweig White Information Service‚Äôs Media Group (with the backing of Chicago-based private equity firm Cardinal Growth), which included titles such as CE News and Structural Engineering & Design. Then in March 2010, Stagnito acquired Nielsen Business Media‚Äôs four food group magazines (Convenience Store News, Progressive Grocer, The Gourmet Retailer and Convenience Store News for the Single Store Owner), as well as their related Web sites and tradeshows.
‚ÄúThey were strong properties‚ÄĒProgressive Grocer has been around for 90 years,‚ÄĚ says Stagnito. ‚ÄúThe problem was that Nielsen had been trying to sell its b-to-b titles for two years and as a result had implemented major cost containment.‚ÄĚ
Stagnito changed several things in a short period of time including personnel and headquarters (moving the Nielsen titles from downtown Manhattan to Jersey City), as well as putting in place a new infrastructure. ‚ÄúNielsen had vertical silos like many large companies where production, circulation and lot of actual administrative duties were in different silos and we had to put back into one system,‚ÄĚ says Stagnito.
The publisher looked to restore the monthly frequency of some of its Nielsen acquisitions. ‚ÄúNielsen had cut frequency from 12x to 8x,‚ÄĚ Stagnito says. ‚ÄúWe started putting those issues back in place and in 2011 we will have full frequency.‚ÄĚ
Stagnito also began launching new products, including spin-offs such as Progressive Grocer Store Brands (which was profitable after its second issue) and Progressive Grocer Independent Retailer, which is currently a special section but spins off as its own magazine in July. The company is also launching two new buyer‚Äôs guides. ‚ÄúWe were happy to acquire a group with directories, one for the convenience store industry and one for the grocery industry,‚ÄĚ says Stagnito.
The company has also established a new custom media division. ‚ÄúWe had one at the original Stagnito and put that back into play in April,‚ÄĚ Stagnito adds. ‚ÄúIt‚Äôs growing rapidly, it‚Äôs a separate profit center and a great support mechanism for the brands themselves.‚ÄĚ
Stagnito does six live
events and plans to add more in 2001. One‚ÄĒHispanic Retail 360‚ÄĒ‚ÄĚwas
successful beyond our comprehension,‚ÄĚ claims Stagnito.¬† ‚ÄúWe had 425
attendees and we‚Äôll do it again next year with [former president of
Mexico] Vicente Fox speaking.‚ÄĚ
Digital Up 300 Percent, But Print Remains The Core
While Stagnito won‚Äôt share revenue figures beyond ‚Äúless than $20 million,‚ÄĚ he says the current revenue ratio is 70 percent print, 15 percent digital, with the rest divided among events and custom.
Digital revenue has increased by 300 percent, according to Stagnito. Webcasts and vertical channels are the biggest earners and the company has opened two vertical channels‚ÄĒone for Convenience Store News, the other for Progressive Grocer.
Stagnito expects total revenue to double within the next five to seven years, and while print may drop as an overall percentage, it will still be key for the company.
‚ÄúWhen we¬† made the Nielsen deal, I said I believed in print and nothing has changed,‚ÄĚ says Stagnito. ‚ÄúI‚Äôm not unrealistic, we obviously see what‚Äôs happening with the print-to-digital migration, and we‚Äôve become an integrated media company. But if you‚Äôre carrying 30 percent marketshare in print, there is 70 percent out there that you haven‚Äôt picked up yet. It‚Äôs not dead, it is changing, but few magazines have more than 25 percent share of market unless they own that industry.‚ÄĚ
wants to increase revenue dramatically, doubling it within the next five
to seven years. The company is profitable. ‚ÄúPrint will be going down
against that 70 percent revenue ratio but, as total revenues increase,
that‚Äôs OK,‚ÄĚ he adds. ‚ÄúDigital will continue to grow, but we‚Äôre finding
out that it takes an awful lot of tech understanding to get to the next
level because it doesn‚Äôt cost much for entry. That‚Äôs something all media
companies have to face‚ÄĒhow much do I want to put out in terms of the
technology when I can get a copy cat in two months.‚ÄĚ
Twenty Years of Startups
This is Stagnito‚Äôs fourth startup in 20 years. ‚ÄúThe risk/benefit ratio has become more difficult,‚ÄĚ he says of the process. ‚ÄúThere were too many people with money over last 10 years who did not understand media. People today are bundling up, getting back to day-to-day basics such as attention to detail and execution rather than acquisitions and the next big idea.‚ÄĚ
Finding talented sales and marketing people is the biggest challenge for b-to-b publishers today, he said. ‚ÄúThere are a lot of people capable of edit, production and audience development, but the pipeline of sales and marketing has dried up.‚ÄĚ
Stagnito says b-to-b executives should have the sales skills to back up their message.
‚ÄúI believe that to be successful in b-to-b, management has to have in-field, knock-on-the-doors training,‚ÄĚ he adds. ‚ÄúYou can have someone come in from the outside to be president, but someone running sales and marketing has to have experience in the field. Without it, you‚Äôre at the mercy of second and third-hand information."