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Marketing Strategy of Conde Nast Publications, Inc.

Marketing Strategy of Conde Nast Publications, Inc.

Discuss Marketing Strategy of Conde Nast Publications, Inc. within the Marketing Management forums, part of the PUBLISH / UPLOAD PROJECT OR DOWNLOAD REFERENCE PROJECT category; Condé Nast (pronounced /ˌkɒndeɪˈnæst/) is a worldwide magazine publishing company. Its main offices are located in New York, Chicago, Miami, ...

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Marketing Strategy of Conde Nast Publications, Inc.
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Anjali Khurana
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Marketing Strategy of Conde Nast Publications, Inc. - December 16th, 2010

Condé Nast (pronounced /ˌkɒndeɪˈnæst/) is a worldwide magazine publishing company. Its main offices are located in New York, Chicago, Miami, Madrid, Milan, Tokyo, London and Paris. Condé Nast is run by S.I. Newhouse Jr, and is a division of Advance Publications, who have owned the company since 1959.



Statistics:
Wholly Owned Subsidiary of Advance Publications Inc.
Incorporated: 1922
Employees: 10,000
Sales: $1.8 billion (2002 est.)
NAIC: 511120 Periodical Publishers


Company Perspectives:
Home to many of the world's most celebrated magazines, Condé Nast Publications is committed to journalistic integrity, influential reporting and superior design. Each magazine features world-renowned editors, writers and photographers--an incredible stable of talent unmatched by any other publishing company.


Key Dates:
1873: Condé Nast is born.
1892: Fashion magazine Vogue is first published.
1909: Condé Nast buys Vogue and begins his publishing venture.
1911: Nast buys an interest in House & Garden.
1914: Nast launches Vanity Fair magazine.
1922: Condé Nast Publications (CNP) is incorporated.
1936: Vogue and Vanity Fair are merged.
1939: Glamour magazine debuts in the United States.
1942: Nast dies.
1959: S.I. Newhouse, Sr., newspaper magnate, buys CNP.
1979: Newhouse, Sr., dies and sons Si and Donald take over CNP and parent company Advance Publications Inc.
1983: Vanity Fair is reborn.
1988: CNP acquires Details magazine.
1993: CNP buys Bon Appétit and Architectural Digest; House & Garden is shuttered.
1995: House & Garden is relaunched for a younger female audience.
1999: New CNP headquarters at Times Square is completed, with a Frank Gehry cafeteria.
2001: CNP buys a majority stake in Ideas Publishing Group and launches Lucky shopping magazine.
2002: Modern Bride joins Bride's in the CNP bridal group.
2003: Plans for Cargo, the male version of Lucky, are announced.


Company History:

Condé Nast Publications, Inc. (CNP) was founded with a particular vision to serve various niche markets, and has done so with magazines devoted to many age groups, lifestyles, and appetites. While some have called this strategy pure genius, others have termed it pretentious. Nevertheless, the Condé Nast name stands for high-caliber periodicals devoted to their audiences, be they the cosmopolitan sophisticates who read Vanity Fair, House & Garden, Condé Nast's Traveler, or the New Yorker; the fashionistas who adore Vogue and Glamour; the young women devoted to Teen Vogue, Mademoiselle, Bride's, and Modern Bride; the gentlemen who buy GQ or Wired; or the epicureans who enjoy Bon Appétit and Gourmet. Beautiful, relevant, and sometimes irreverent, Condé Nast Publications has long set the standard for quality and attitude.

Coming on the Scene: Late 1800s to 1920s

The future success of Condé Nast's fashion-driven publications was mirrored and secured in part by the charm and polish of the man himself. His family, of mixed French and German stock, had settled for several generations in the United States. Born in 1873, Nast was strongly influenced by his aristocratic French mother, who infused him with the calculated manners and social restraint of high social circles. His father lived mostly abroad and died young, having much less, if any, influence on his son. As an adult, Nast was noted for his urbane persona.

Vogue magazine served as the early testing ground for what Nast called a "class publication" and he developed an entire business theory based on the belief that certain types of people, when offered a publication tailored to their class and particular needs, would then create a sizable and enduring market. Vogue was first published in 1892 as a weekly journal of society and fashion news interspersed with verse and lightly humorous drawings. Nast bought the magazine in 1909 with the intention of upgrading it and became its active owner and manager. He adhered to a strict "fixity of purpose" doctrine--always maintaining a firm vision of a publication's audience--in order to conserve the magazine's "pure class" standing. Fiction, for example, was not welcome in early Vogue even though Nast believed it might have increased circulation. Instead the magazine was carefully tailored to the expectations of its subscribers, down to the smallest details, from articles and photographs to page setup and advertising.

Nast's vision for Vogue made it a must-have for certain parts of society and it became the fashion bible of the times. The publisher next bought an interest in House & Garden in 1911. Four years later, Nast took House & Garden over completely and transformed the magazine from an architectural journal into an interior design authority. In 1914 Nast introduced Vanity Fair, a magazine that quickly set publishing standards in the world of arts, politics, sports, and high society. Under the editorship of Frank Crowninshield, Vanity Fair gained a reputation as a sophisticated and glamorous magazine infused with a lighthearted and often acerbic wit. In 1916, still flush with the success of Vogue, Nast took an unprecedented step and introduced an international edition for the United Kingdom called British Vogue, the first of many worldwide incarnations of the fashion magazine.

Nast also took steps to ensure quality production of his growing family of magazines. In 1921 he bought a small interest in Arbor Press of Greenwich, Connecticut. This facility eventually became the Condé Nast Press and was expanded and completely modernized to become one of the finest magazine manufacturing plants in the country. (The press was later closed in 1964 to make way for more centrally located sites capable of producing higher volume.)

A Changing of the Guard: 1930s to 1978

Despite the rigors of the Depression, CNP forged ahead with innovations in design and quality. Color photographs appeared within the pages of Vogue, Vanity Fair, and House & Garden, and in 1932 the first color photograph appeared on the cover of Vogue. Although Vogue had continued to thrive since Nast acquired the fashion magazine, the lesser known though more highly evolved Vanity Fair struggled. In one of his few major errors in judgment, Nast decided to merge the two vastly different magazines in 1936, much to the chagrin of Vanity Fair editor Crowninshield. The combined periodical ran as Vogue and what was once Vanity Fair more or less vanished in Vogue's fashion-dictated pages. In 1939, Nast introduced another magazine devoted to fashion and beauty, called Glamour. Glamour was the last publication Nast personally developed for the CNP collection; three years later, in 1942, Condé Nast died.

After Nast's death, his empire continued onward without much fanfare through the remainder of the 1940s. One major achievement of the time, however, was in international growth. Following the earlier success of the British version of Vogue, a French company was established to produce a French Vogue. By the end of the 1950s, however, CNP would change forever. In 1959, another man with set ideals of what publishing was and should be entered the picture. S.I. Newhouse, Sr., the renowned newspaper and media giant, purchased a controlling interest in the company and instituted a changing of the guard in senior administrative positions.

The same year Newhouse acquired CNP, the firm acquired Street & Smith Publications, Inc., which included titles such as Mademoiselle and several sports annuals such as College Football, Pro Football, Baseball, and Pro and College/Prep Basketball. In the early 1960s, CNP continued its international agenda with another Vogue, this time entering a partnership to produce an Italian version. Life within the Newhouse kingdom in the 1960s and early 1970s was marked by a period of acquisitions and the overhaul of existing publications rather than the creation of new publications in a highly competitive--and uncertain--publishing industry.

Father to Sons and Rampant Growth: 1979-89

Two decades after S.I. Newhouse, Sr., bought CNP, his death in 1979 passed management of the privately held empire, Advance Publications Inc., to his two sons. S.I. Newhouse, Jr., known as "Si," ran the magazine and book operations, while brother Donald Newhouse took charge of the newspaper and cable television operations. Following the transition, Si Newhouse purchased Gentlemen's Quarterly (GQ) from Esquire Inc. for CNP. Founded in 1928, GQ had once been a fashion booklet distributed in men's clothing stores but grew into a preeminent source for probing journalism, fiction, essays, and eclectic coverage of subjects from food to financial planning for its 25- to 39-year-old male audience.

The same year GQ came into the fold, CNP revisited its glory days by launching Self magazine, the first publication CNP had started from scratch since 1939's Glamour. Self became a popular sourcebook for women who were "reinventing almost every aspect of their lives from a health-aware, issue-oriented point of view," according to a CNP brochure. Offering information-packed, quick-read journalism to busy women, Self's circulation was no less fast-paced: within 30 months of its launch, the magazine reached more than one million readers. Then adding to its diversity and transcontinental reach in 1982, CNP bought the Tatler, the British monthly magazine devoted to social news, the arts, features, and fashion.

Less than a year after taking on the impressive history of the Tatler, CNP made a comparable move in the United States by reviving Vanity Fair, which had disappeared after its merger with Vogue decades earlier. Amidst much fanfare in early 1983, CNP invested roughly $10 million toward strengthening the magazine editorially and getting it off to a powerful new start. Hoping to elevate Vanity Fair to its former status as a crown jewel of Condé Nast's "class" publications, CNP packed the lavish first reissue with an entire short novel by Gabriel Garcia Márquez, winner of the 1982 Nobel Prize for Literature. Its 290 glossy pages also included lively articles by Gore Vidal, paleontologist Stephen Jay Gould, and other gems to recapture what had once made it "America's most memorable magazine," according to critic and writer Cleveland Armory.

While Vanity Fair was underway, CNP also had acquired Gourmet magazine, the oldest and second largest of the four major American epicurean magazines. The company's appetite for growth was not sated, however, as CNP launched new premium magazines. In the fall of 1987 came Condé Nast's Traveler, a monthly magazine for affluent globetrotters, which incurred a startup cost of approximately $40 million.

Travel was not the only domain into which CNP ventured in the late 1980s. In early 1988 the publisher acquired Details magazine, an irreverent chronicle of Manhattan's downtown art, fashion, and club scene, and transformed it into a young men's fashion and lifestyle magazine. Later the same year CNP bought Woman magazine, an eight-year-old bimonthly with a circulation of 525,000, from Harris Publications. Less sophisticated than CNP's other women's magazines, the new magazine would steer into a previously uncharted niche market.

A New Era: 1990s

By the early 1990s CNP had not only expanded domestically but internationally as well, with foreign operations and subsidiaries in England, France, Italy, Germany, Australia, and Spain, and with licensee arrangements in Mexico, Brazil, and Japan. In addition, CNP's Glamour had become the largest-selling beauty/fashion/lifestyle magazine in the world. Glamour also had gained its share of critical recognition, winning the National Magazine Award for General Excellence in 1981 and 1992, among other distinctions.

Despite a growing slump in the magazine publishing industry, CNP started yet another glossy spread, Allure, in March 1991. Devoted entirely to beauty, Allure jumped from a starting circulation of 200,000 to reach 625,000 before its second anniversary, making it one of the fastest-growing magazines of its time. With its unusual combination of high fashion and piquant journalism, Allure was nominated for a National Magazine Award in its first year.

Following its triumph with Allure, CNP acquired Knapp Communications in early 1993. Knapp published such prominent periodicals as Architectural Digest and Bon Appétit. Architectural Digest boasted sumptuous spreads on the homes of the rich and famous while Bon Appétit's circulation of 1.2 million placed it in the top ranks of food magazines. Soon after CNP reacted to the "information highway" hype, buying a 15 percent interest (the remaining interest was bought in 1998) in Wired, the self-anointed "house organ of the digital revolution."

As CNP publications joined the digital age, the legendary Condé Nast culture--of high-brow literati and urbane tea-sippers--was undergoing changes of its own. CNP's quirky game of managerial musical chairs became more serious as several key directors stepped down from their long-held thrones. At the top of the hierarchy sat Alexander Liberman, who for more than 50 years had been the creative force, as editorial director, behind the entire group of magazines.

In April 1994 the 81-year-old Liberman was succeeded by 36-year-old James Truman, former editor of Details magazine, giving the media cause for lively speculation. New, young blood also found its way into the other key CNP post, as Steven T. Florio was named president effective June 1, 1994. Florio--who had served nine years as president and six years as CEO of the New Yorker--succeeded Bernard Leser, 68, a 34-year veteran of CNP and president since 1987. Florio took little time to start making changes; within a few months more than three-quarters of CNP's magazines had new publishers in place. The company also became more family-oriented, offering its employees flex-time and a backup childcare system at no cost (since CNP's workforce was made up of nearly 70 percent women, this was a major boon).

Next came a relaunch of the venerable House & Garden, on the shelf since Bon Appétit and Architectural Digest joined CNP. The new House & Garden was intended for a younger audience, primarily women in their 30s, who were looking for both a lifestyle and home decorating magazine. CNP also planned to take Italy by storm by securing the rights to the Italian version of its Architectural Digest. To keep up with evolving technology, CNP created CondeNet to design web sites for its magazines, beginning with Condé Nast Traveler and a gourmet web site called Epicurious featuring articles and information from Bon Appétit and Gourmet magazines.

The late 1990s marked further expansion abroad for CNP. In 1997 the firm established ties with South Africa to bring House & Garden to the country's readers, then worked out a deal with Japan's Nikkei to launch Japanese Vogue in early 1998. Stateside, CNP bought Women's Sports & Fitness, the magazine founded by tennis legend Billie Jean King, and it merged into Condé Nast Sports for Women, which had been introduced in late 1997. The revamped magazine, Condé Nast Women's Sports & Fitness, began publication in the fall with bimonthly editions.

Around the same time, CNP finalized its purchase of Wired magazine (rumored to be $75 million) and made plans to bring Newhouse's famed New Yorker magazine (bought in 1985 and run independently through Advance Publications) into the Condé Nast flock. For the New Yorker, placing it alongside CNP's other upscale publications seemed a logical move: not only would it be among urbane company but its new siblings were profitable while the New Yorker had been swimming in red ink. Although the New Yorker would still maintain its autonomy, CNP higher-ups believed the move would help the sophisticate regain its financial footing (which it did by 2002).

In 1999 the company entered discussions with Walt Disney to buy Fairchild Publications for $650 million. Fairchild, producer of periodicals W, WWD, Los Angeles Magazine, Daily News Record, Footwear News, Jane, and others, seemed to present a conflict of interest with CNP since the former's publications reported on the folks who filled the advertising pages of most CNP magazines. Rivals such as Elle and Cosmopolitan, on the other hand, filled Fairchild's ad pages and were reportedly loathe to put their dollars into a CNP-owned franchise. The situation was somewhat solved when CNP parent Advance Publications bought Fairchild in 1999.

Also in 1999, CNP finally moved into its new headquarters in revitalized Times Square. The 48-story building had been beset with problems since its original design was set forth, including construction accidents and several deaths. For the Condé Nast folks, however, their new offices were hip and ecologically correct, built by the "green" friendly Durst Organization, complete with a Frank Gehry-designed cafeteria.

A New Era: 2000 and Beyond

In 2000 CNP transferred Details magazine over to sibling Fairchild, then bought a majority stake in Ideas Publishing Group in 2001, which produced Spanish translations of major U.S. publications. At the top of CNP's wish list were Latin American versions of fashion titans Glamour and Vogue, and Architectural Digest. CNP bought the remaining interest in Ideas in early 2002, just as it expanded its lucrative bridal group with the acquisition of Modern Bride, the primary rival to Bride's magazine. The $52 million deal gave CNP a strong hold on the bridal market, with the two publications each producing six editions a year on a staggered schedule.

A shopping magazine called Lucky debuted in 2001, geared to young women. CNP believed the magazine was new in scope and coverage, offering readers something different from that contained in its other fashion, beauty, or lifestyle magazines. Initial sales were excellent, with Lucky living up to its name. In 2003 CNP took its most successful franchise, the esteemed Vogue, to a different audience by launching Teen Vogue in January. Despite weaker sales for such rival teen magazines as Seventeen and Elle Girl, CNP had high hopes for its fashion hybrid. The original Vogue itself was still going strong after a century in print, quietly increasing its circulation.

The venerable GQ (Gentlemen's Quarterly), unlike Vogue, was suffering sluggish ad sales and a drop in readership. To remedy the problems, Newhouse purged the magazine's staff and initiated a major makeover to appeal to a broader (read younger and hipper) spectrum of men, especially the ones who were buying the so-called "lad" magazine upstarts, including Stuff, FHM, and the more licentious and thriving Maxim and Playboy. The magazine also gained new exposure in the fall by teaming up with Spike TV (formerly TNN) to present the eighth annual GQ's Men of the Year awards.

New magazines set to launch included Cargo, masculine sibling to the successful shopping magazine Lucky; a U.K. launch for Trash, a joint venture with Ministry of Sound for an entertainment and lifestyle magazine (though its fate was uncertain); and an untitled art magazine appealing to the high-brow clientele of Architectural Digest, Vanity Fair, and House & Garden set to debut in 2004. Although CNP had changed a great deal from the days of its founder Condé Nast, the publishing firm had remained true to many of Nast's business doctrines concerning "class" publications and the people who bought them. Nast's visionary status, however, remained evident in the continued success of Vogue, Glamour, Vanity Fair, and House & Garden.

Principal Subsidiaries: Comaq Marketing Group LLC; Ideas Publishing Group.

Principal Competitors: Advanstar Communications, Inc.; Hachette Filipachi Médias; The Hearst Corporation; Time Inc.
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