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So What Do You Do, Cathie Black?

"The First Lady of American Magazines" on how Hearst is tackling Web 2.0 and why publishing affords women so many opportunities

By Greg Lindsay - February 12, 2007
Cathleen

Cathie Black is referred to, un-ironically, as "the First Lady of American Magazines," a title that not only describes her power within the industry, but also her shattering of its glass ceiling. It’s largely due to Black that Hearst has been the steadiest of America’s great magazine companies, conserving its strength and growing slowly, steadily, while others chased grand expansion plans and digital dreams.

But now, Black has decided that the time is right for Hearst to join the Web 2.0 wave in earnest, beginning with a generation of magazine sites rolling out over the next few months. mediabistro.com recently interviewed Black about her company's plans, the shape of the industry, and the endgame for the magazine business, which she dutifully presented in nearly 25 words or less: "There will continue to be stars made and opportunities presented -- I don't know if there are going to be fortunes made -- I think we are going to be around as we know it as long as we all are comfortable constantly with reassessing, with taking risks and not being afraid of change, of just getting unstuck. But I think, personally, that most people have gotten over that."

Name: Cathleen P. ("Cathie") Black
Position: President, Hearst Magazines
Publication: 19 consumer magazines in the U.S., nearly 200 worldwide, including such brands as Cosmopolitan, Good Housekeeping, Esquire, O, The Oprah Magazine, and Seventeen
Education: Trinity College (She also holds eight other honorary degrees)
Hometown: Chicago
First job: Ad sales at Holiday magazine
Last 3 jobs: President, then publisher of USA Today; executive vice president/marketing of Gannett; resident and CEO of the Newspaper Association of America.
Birthdate: 4/26/44
Marital status: Married
What's your favorite TV show: Grey's Anatomy
Last book read: Two books in progress -- Bad Blood by Linda Fairstein, and I'm about to start Why Some Ideas Succeed and Others Die by Chris and Dan Heath, that Kate White, editor-in-chief of Cosmo, highly recommended. And there is always a cookbook by the side of the bed for browsing.
Most interesting media story right now: Frankly, it changes every day, sometimes every hour. But right now, Viacom asking YouTube to remove 100,000 clips from its site and the Cartoon Network guerrilla marketing stunt mistaken for a bomb threat are the two most interesting stories. [Ed: Answer was sent Feb. 5]
Guilty pleasure: Massage
First section you read in your Sunday paper: Page One and then Real Estate! (I just bought a house.)

It’s my understanding that Hearst is about to begin re-launching each of its magazine sites over the next few months, beginning with Esquire.com. I’m curious as to what the readers should expect of these sites now that Hearst is finally heading back onto the Web in a big way.
First of all, the sites are going to look different from each other. The primary phrase we have at the front of our brain, hopefully every single day, is "the user experience." Our editors have moved from thinking that a magazine's Web site was just the magazine on the Web, to really thinking that the magazine is a brand on the Web. We know for sure that it has to be, and is, a different medium. In other words, we want to keep that user going forward so they are finding the experience on our Web site interesting, interactive, entertaining, fun, you name it.

Each one of them has been carefully thought out. [Esquire editor] David Granger and I just had lunch today, and he was talking about Eric [Gillin], his Web site editor, who he thinks is fantastic and who has a million ideas and kind of, sort of scoped it out in his own mind. The teen sites have been a petri dish for us. We've had a very goodWeb site for CosmoGIRL!, and a younger staff is creating that, so we've used that as something to look at to try to figure out what elements of that make sense for some of our other sites. Everyone is just hot to trot. I mean all the editors here and the Web editors want their site to be the best, and they wanted it up yesterday.

Unlike Time Inc. or Condé Nast, Hearst has been happy to farm out its Web operations at times to Women.com and to iVillage. But now you've recentralized again with Hearst Digital and the editors' newfound zealotry for the Web. How and why did Hearst get its Internet religion, lose it, and then get it back again?
Well I don't think Hearst ever lost religion, but the Web has changed so dramatically. Early on, there was Home Arts, which merged with Women.com. So right from the beginning, we were working through partners. I don't know if that was such a bad thing because, let's face it, there weren't that many users back then, and certainly there were no ad dollars. In any event, Women.com handled our sites, so we kind of talked the talk, but we were not creating them. It was the same thing with iVillage. Yes, there was a Web editor for each magazine here, but the real ownership was at iVillage. I mean that figuratively and literally. And we all felt very strongly that for us to really be a part of a very transformational moment in our media world, we had to be the patrons of our own sites. So there's great excitement here that this is the right moment. Our sites are magazine brands; we don't want them disconnected from the brands here.

What’s Hearst’s philosophy online in terms of revenue and growth? Ann Moore is making headlines, seemingly every week over at Time Inc., as she seeks to dump every spare penny into the magazine sites. She's convinced that online is where all of Time Inc.'s future growth lies.
The day that the digital revenue for Cosmo will come close to profit that Cosmo makes for this company will be a beautiful thing. Cosmo is a huge profit-maker and a huge revenue-generator, so it would surprise me if at any time in the next couple of years we would see anything approaching it. Maybe it's 10 percent of our ad revenue that comes into the company today, but the idea of it becoming 50 percent or even higher of the revenue from our magazine division is just improbable to imagine. I could be wrong, but I don't see the migration of many of our magazines to a digital-only platform.

That said, do we need a new way to measure the vitality of magazines? Is it worth it to still track advertising pages sold? And is it worth a permanent 5 percent decline in ad pages in exchange for what amounts to a 10 percent gain from digital revenue? Are we talking about the wrong things when we talk about the health of the business as a whole?
No, I don't think we are talking about the wrong thing, but what I do believe that we have to look at digital efforts as its own business, because it's expensive. What I don't want is to encourage advertiser A or advertiser B to say 'Well, I spent a $100 with you last year. In 2007, I'm going to spend $90 at that magazine and $10 online.' And I don't want them saying 'you should feel good about that' because I want them to spend $110. It shouldn’t be an either-or.

In your remarks at a recent Magazine Publishers of America breakfast, you touched upon the increasing difficulty of launches. Other publishers have experienced this too, with Time Inc., Hachette, etc. all closing magazines to refocus on core properties like People, Sports Illustrated, and Elle. Even Meredith is pouring the majority of its efforts into franchising brands like Better Homes & Garden in new media, rather than inventing new brands. Given those developments as a backdrop, how do you see the Hearst portfolio evolving? Is it inevitable that the largest publishers will only have a handful of their most successful brands pumping at their hearts?
It's a simple answer to say you have to do some of all of it. We're all looking for the next big idea for what could be a really important magazine. Oprah has been an extraordinary successful magazine. And there are new magazines started in the last decade: Real Simple, and now [Everyday With} Rachael Ray seems to have gotten a lot of traction on the newsstand. But it's a much more difficult environment.

You know, years ago here at Hearst, we launched Country Living, which has been a great moneymaker for more than 20 years now. We put one magazine on the stands with no ad staff and it sold very well, which told us that this reader really had a connection to the magazine. In today's world, pick any number you want; I have no idea what Condé Nast will have spent -- both for almost the last two years and into the next two years -- on Portfolio. They've announced it’s a $100 million investment. We're just not going to do that. It may not be a hockey stick [Black is referring to the shape of financial projections on a graph], but at some point, after your big early investment period of two or three years, what's it really looking like there? Is it going to get the ad traction? Maybe it will, I'm not really positive.

But you know, we're a different company, everybody's a different company. We measure our metrics very carefully. We review our new products constantly, and ask 'is it going to hit break-even?' But not only is it going to break even, what is it going to do in the 24 months after that? It is going to really make sense for us to put in the time, the effort, the creativity, the financial investment, etc.? It would be great to be able to launch something for $10 million, but when you're in New York and the ad community demands a big hoopla over the launch of a magazine, it adds overhead that's just unbelievable and hard to live up to.

What happens to staffing levels and employees as the industry contracts and cut costs to maintain its overall health? You're on record as being a fan of the British magazine method, with its smaller, more nimble staffs, and Hearst's magazine have quietly reduced headcount on your watch. What does the staff of the future look like at Hearst, and will employees have the same opportunities to advance upward?
That's a very good question. I remember when Felix Dennis spoke at the MPA Conference six years ago, and he knew that when he came to the United States to launch Maxim, he would have a 25 pecent larger staff than he did in the U.K. just because that's how New York is. And that's the sort of thing we wrestle with all the time.

For example, Quick and Simple is, at this point, sold by the Good Housekeeping sales staff. There's a lot of synergies between the two, so the former's advertising staff is -- honestly! -- one person and an assistant. But they have the resources of Good Housekeeping, which has a lot of feet on the street, if you will. America has not come around to the way most advertising is sold in the rest of the world, which is much more on a group concept. You might have a publishing director -- there's no publisher -- and the next title is probably "advertising director," and they might sell two magazines or it might be a group.

We were charting workflow not long ago -- I like the operations side of the business -- and if you look at the U.K., an editor might touch a piece of copy once or twice because it's a small staff. It's that they don't have the time, not because they don't have the interest. They don't have the time. It moves through the system very quickly. If you chart most magazines in the United States, including our own, you'll see that people are touching, and retouching, and editing, and re-editing something six or seven times. If you want to figure out why that happens, look at the UK. I would suggest that they have very few middle managers. It's probably 15 people or 18 people or even seven people, so they multitask. They don't work all night long. Honestly, they aren't in the production departments at eight or nine at night.

How is the new Hearst Tower helping with recruiting? It's been suggested that the new building and new cafeteria has gone a long way in addressing Hearst's corporate inferiority complex vis-á-vis Condé Nast.
The power of an environment to change people's thinking,, and their attitude and their sense of everything is unbelievable. Our retention rates have already gone up... it's only a few percentage points, so it's not going to make or break it one way or the other but -- quite honestly -- if I were 25 and if I were interviewing at this company or a similar company, and saw that we have a fitness center and saw this incredible café, and all the open work environment that creates communication and camaraderie and all the rest of it, I'd think it's a slam dunk.

Well, assuming you were 25 again, and were starting your career over again, where would you start? Seeing that you began your career at Ms., and seeing that Ms. doesn't really exist anymore, I was picturing you starting out at some sort of blog network aimed at young women…
I have always loved the print business. I'm as excited about the digital world as anybody else, but I love the feeling of being around creative people, of looking at beautiful things, of reading a great story, so I'd probably come to magazines again.

You broke gender barriers during your upward ascent, including becoming the first female publisher of a weekly magazine at New York. How has the magazine landscape changed since then in terms of opportunities for women? From my generation's view, publishing would seem to be dominated by women, or at least editorial is.
It's a very welcoming environment, and if you want to look at an industry and ask 'Where have women succeeded? Where are they sitting in the larger offices? Where do they have the titles?' I think you would say, for whatever reason, 'Gee, this seems to be a place that I can excel.' Women tend to get stuck in the staffing positions, not the line-operating positions, and they haven't been trapped in those in publishing.

Greg Lindsay is a freelance writer.



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