Folio: Summit Keynote: Despite Online Competition, Magazines Still a Good Investment (posted 3/20)
When Joe Mansueto purchased Inc. and Fast Company for $32.5 million in 2005, they were two publications long-neglected by their publisher. “The previous owners (Gruner & Jahr) had disinvested in the magazines,” said Mansueto, delivering the morning keynote at the Folio: Publishing Summit in Chicago. “They had lost the trust of the advertisers.”
Despite online competition, magazines still make good investments, said Mansueto. A long-time reader of Inc. and Fast Company, Mansueto, founder of MorningStar, a publicly traded mutual fund and investment information provider, couldn’t resist putting in a bid for the publications when they were put on the market in May 2005.
After winning the auction, Mansueto’s strategy was to create an independent publishing company and to invest in technology and online. “Inc., for me, has always been a very powerful magazine,” he said. “I’m a firm believer in the power of capitalism, a free market and entrepreneurship. And Inc. is at the center of this movement.”
To strengthen, the Inc. brand, Mansueto invested in better-quality paper stock and increased edit pages 20 percent. He also increased the editorial staff, hiring away Real Simple editor Jane Beretson.
At Fast Company, Mansueto implemented a more “visually exciting” design featuring a prominent person on every cover. He also transformed the print-heavy brand into a multi-platformed brand focusing on online, events, as well as franchise print issues. “Mansueto is a world-class publisher,” Mansueto said. “We don’t want to be the kind of company that wants to ratchet down costs. We cover progressive companies and we need to practice what we preach.”
The efforts have paid off. Inc. is the number one business publication and newsstand sales are up 47 percent and Fast Company is the number three business publication with newsstand sales are up 37 percent. Combined Web traffic for the magazines grew 50 percent last year and is expected to grow at least 20 percent this year, Mansueto said. Unique visitors for the sites are up 159 percent.