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October 14, 2019

Publishing News

Meredith, Property Brothers Launching Newsstand Quarterly
Release: Meredith Corp. has partnered with Drew and Jonathan Scott, the stars of HGTV's "Property Brothers," to launch a quarterly newsstand magazine in January 2020. The magazine--whose name and tagline will be revealed in the next few weeks--will have a $9.99 cover price and an initial print run of 500,000. Meredith is also starting subscription promotions priced at $20 for four issues. "We love print and have always wanted to extend our message of living life to the fullest through this medium," said Jonathan Scott. The magazine will showcase the Scotts' "exclusive take on home décor and design, in addition to their focus on entertaining, family, food, gardening, outdoor living, wellness, music, travel and more," and feature "bold photography and heavy paper stock, as well a limited amount of advertising," providing advertisers "with an opportunity to reach a high-quality audience," says the release. The Scotts are also the hosts/producers of multiple HGTV series "Brother vs. Brother"?and "Property Brothers at Home." They are bestselling authors, market their own collection of indoor furniture, have an online design platform (Casaza) and a mobile game (Property Brothers Home Design). 


Hearst To Operate Crain's Autoweek Digital Businesses
MediaPost: "Hearst Magazines has entered a multi-year licensing deal with Crain Communications to operate the digital and experiential businesses of Autoweek. Crain will cease publishing the print product, which was produced twice a month. “As Crain continues to grow its B2B footprint, we felt Hearst was a perfect fit for our only consumer brand,” stated Crain Communications president-COO KC Crain. The Hearst Autos division, which oversees titles such as Car and Driver and Road & Track, will produce and continue to invest in, which will be hosted on Hearst Magazines’ content platform, MediaOS. Hearst Autos will also build out Autoweek’s newsletters and podcasts, according to the company.Autoweek is already part of Hearst’s auto ad network Start, formerly known as Jumpstart. So is its Autos Group and other outside brands, like J. D. Power and US News & World Report auto ads. Hearst “will leverage their creative expertise, best-in-class technology services and innovative marketing solutions to continue the legacy of this storied brand,” Crain stated. The Detroit-based Autoweek staff will be led by Patrick Carone, who is based at Hearst Autos headquarters in New York. Carone will oversee all content and digital initiatives across Autoweek."

White Paper: Print 'Thriving in Wider Publishing Ecosystem'
FIPP: "Print ‘thriving in wider publishing ecosystem’, finds UPM white paperPiet van Niekerk @PietNiekerk10th Oct 2019Features Print continues to play a pivotal role in multi-platform, multi-channel strategies for publishers. This was one of the key takeaways from a presentation at FIPP Insider in Paris based on a UPM white paper on the future of media. ‘The Future of Media: How digital-to-print revenue models continue to shape the industry’ is one of four white papers produced this year by FIPP in collaboration with UPM Communication Papers, one of the six business areas of UPM the Biofore Company. The white paper explores the value print continues to bring to publishing portfolios and how print fits into the wider publishing ecosystem.The paper’s author, Jon Watkins, a content marketing and media consultant, told delegates to FIPP Insider in Paris earlier this month he set out to highlight opportunities for publishers to engage more of their audience and generate more revenue through a multitude of (publishing) channels – not just print or digital. To do this - and with the help of some of the most influential publishers in the industry - they first looked at the current publishing landscape, particularly with regards to digital usage and trends. The evidence pointed to the fact that digital disruption is escalating and will put even more pressure on the publishing industry to adapt and reconsider their approach. Some of the digital disruptions they took note of were: The growth of podcasts. Since 2017 up to 44% (124M) of the American population has listened to podcasts; smart-speaker penetration had reached almost 50% in markets where they are available; WhatsApp is now used for news distribution by around half of online users in countries such as Malaysia (54%) and Brazil (48%); and digital publishing subscriptions have become the most important revenue stream for news publishers worldwide, at 44%. Despite the continued growth in digital usage, said Watkins, statistics also support the notion that print continues to thrive. This includes: 58% of subscribers still describe themselves as primarily print-oriented; 60 to 80% of publisher revenues are still generated from print; in the US, the top 25 print magazines reach more adults and teens than the top 25 prime time television shows; and 24.6Mn UK adults were reading news brands daily, as well as 36 million reading magazines monthly. Within this wider ecosystem, said Watkins, publishers should not be thinking about creating content for digital or print, they should be thinking about how they want to connect with different audiences. The need to ask: what does each audience want and how do we get it to them in the way they want it?" Article goes into greater depth.

New Modern Luxury Owners 'Sneak In' Former THR, Billboard Owner
NY Post: "Modern Luxury media, which publishes over 30 regional magazines, has quietly undergone an ownership change that includes John Amato, the controversial former CEO of The Hollywood Reporter and Billboard. The Dickey family operators have gone from being minority owners to majority owners by buying out private equity firm MacQuarrie Capital, Media Ink has learned. They also brought in Amato—who resigned amid controversy from his former gig in 2018—as a minority owner and gave him the lofty title of executive chairman of the board. It marks Amato’s first gig since his exit from Billboard/The Hollywood Reporter, after he was accused by reporters there of killing an investigative story on alleged sexual harassment by a recording industry mogul who happened to have been a longtime pal of Amato’s. As the company investigated that claim, they reportedly came across other complaints from staffers about Amato’s behavior.Valence Media, the owner of Billboard and Hollywood Reporter, this week declined to comment on the July 2018 investigation. Amato resigned at that time. Michael Dickey, Modern Luxury CEO, said he’s aware of the allegations against Amato. “John’s been with us for seven months. I’m comfortable with his departure from Billboard/Hollywood Reporter. He’s been nothing but a positive for the company.""Terms of the Amato deal at Modern Luxury were not disclosed but a source speculated Amato put in around $10 million for his minority stake, which helped the Dickeys retire the debt and equity owed to MacQuarrie, which helped them buy the company nine years ago.Modern Luxury magazines include Hamptons, Boston Commons, Michigan Ave and Angeleno.

RELX Group Is 2019's Biggest Publisher
PW: "Declining sales in Pearson’s North America business combined with divestitures dropped the company from its longtime perch as the world’s largest book publisher and into second place on Livres Hebdo/Publishers Weekly’s annual ranking. The new book publishing leader is RELX Group (formerly known as Reed Elsevier), which posted publishing revenue of $5.28B last year.RELX moved into the top spot despite a 6% decline in publishing sales in 2018 compared to 2017. The decline was due to a drop in sales from the company’s legal division—which is built around its LexisNexis database—that offset a gain in its scientific, technical, medical group. Revenue from RELX’s events group (which owns BookExpo, among many other trade shows) and its risk assessment division are not included in the publishing revenue figure. RELX’s accession to the top spot among publishers also highlights how companies that began primarily as print book and journal publishers now rely on digital publishing to support growth. In 2018, about 74% of RELX’s revenue came from content sold in digital format.Pearson’s publishing revenue fell 14% in 2018, though stripping out the impact of divestitures and currency movements, revenue was down 1% in underlying terms. That 1% dip was due to a decline in the company’s U.S. Higher Education Courseware unit of 5% and mid-single-digit declines in its U.S. K–12 Courseware division, largely offset by the rest of the business growing in aggregate at over 1%. Pearson sold the K–12 Courseware unit in the first quarter of 2019.Revenue in 2018 fell in seven of the world’s top 10 publishers, due in part to lower spending on educational materials in the U.S. (According to the Association of American Publishers, sales in the higher education market fell 7.3% in 2018 compared to 2017, while revenue to the K–12 market declined 4.4%.) Still, the top 10 companies in the ranking accounted for slightly over half of the total revenue of the 56 publishers who made this year’s cut (i.e., those with sales of at least $150M). The next 10 companies on the list generated another 20% of total revenue. This basic ratio has hardly changed over the past decade.The largest publishers were built in large part through acquisitions, but the biggest deal impacting the publishers in this year’s ranking involved a divestiture. Spain’s Groupo Planeta sold its French subsidiary, Editis, to French multimedia company Vivendi—the company from which Planeta had acquired Editis. The result of the transaction was a drop in Planeta’s revenue to just over $1 billion, and its standing in the world ranking fell to #22, down from #7 in 2017. Vivendi, meanwhile, entered the list at #25, with publishing revenue of $858 million.Last year also had its share of niche purchases. In the U.S., for example, Bertelsmann’s Penguin Random House subsidiary acquired Rodale Books, and the company continued to push further into Spanish-speaking markets. And there is another big deal in the works this year, involving the 12th- and 13th-largest publishers (McGraw-Hill Education and Cengage, respectively). The merger, which has faced some opposition in the U.S., would create an educational publishing company with revenue of around $3B, shooting it up to sixth place in the global ranking. The acquisition is expected to be completed in the first quarter of 2020"...


Retail News

Fresh Direct Reportedly Up for Sale
PG: "Online grocer FreshDirect is looking for a buyer just a year after moving to a new fulfillment compound in the Bronx, according to the NY Post. Amazon and Walmart recently vetted FreshDirect’s financial and performance data as the grocer’s largest investor, JPMorgan, casts around for potential buyers, according to the Post. "JPMorgan is quietly shopping FreshDirect,” retail consultant Burt Flickinger confirmed to the Post. “FreshDirect was built to be a multiregional operator across seven states, and now it is a successful operator in four counties and one state.” A former FreshDirect executive told the Post that Walmart and Amazon have been poking around FreshDirect for months. They haven't made a move, the executive speculated, because they are “waiting for FreshDirect’s valuation to go down further.” Last year, the company moved to a new facility in the Bronx from Long Island City in the borough of Queens. Service glitches have besieged the company since the move, according to the Post.Earlier this year, FreshDirect launched a same-day delivery service enabling its customers who place an order before 10 a.m. to receive it that evening"...

Furner to Succeed Foran as Walmart US CEO
SN: "Next month, Sam’s Club President and CEO John Furner is slated to become President and CEO of Walmart U.S., taking over from Greg Foran, who is leaving the company.Walmart said late Thursday that the move will go into effect Nov. 1. Foran, who has been chief executive of Walmart U.S. since August 2014, is joining Air New Zealand Ltd. as CEO, the Bentonville, Ark.-based retailer said. Plans call for Foran to stay on at Walmart through Jan. 31 to help with the transition. Furner’s successor as president and CEO of Sam’s Club will be announced at a later date, according to Walmart.“John has done a fantastic job at Sam’s Club, and he will continue the momentum we have in Walmart U.S.,” Walmart President and CEO Doug McMillon said in a statement. “John knows our business well, having held many different jobs in the company over more than 25 years, and he is helping transform it for the future. He has the experience and judgment to know what we should continue doing and what we should change. He embraces technology and new ways of working, and he keeps our customers and Sam’s Club members at the center of everything we do, while delivering results for the business. I look forward to seeing his impact for our customers and associates in Walmart U.S.""...

Amazon Delivering Items as Low as $1 Next Day, Free
Vox: "Over the last few months, Amazon has removed several barriers that previously made it difficult for customers to purchase a single sub-$5 item on its own. The result is a flood of low-priced items — a $2 roll of dental floss or a 75-cent makeup brush — made available to Prime customers with free one-day shipping.The changes could have huge ramifications for retailers like Target or CVS, where one-off purchases of consumer packaged goods are common. At the same time, the moves could also add to complaints that Amazon engages in anti-competitive behavior, though current laws typically protect companies that keep prices low for consumers. An Amazon spokesperson did not provide a comment on possible anti-competitive concerns. Instead, she said, “We know customers love our vast selection, low prices, and free one-day delivery with Prime and we are always innovating to improve their experience.” Until recently, someone looking to buy a single item like a stick of deodorant would have to jump through some hoops on Amazon to get it — maybe they’d have to buy a four-pack of deodorant in order to make the economics work for Amazon. Or maybe they’d have to pair a single stick of deodorant — as a so-called “add-on” item — with other goods in an order to hit a $25 minimum before Amazon would qualify the purchase for Amazon Prime fast shipping.But Amazon has now essentially removed its “add-on” program and is also starting to place wholesale orders for cheap items it once turned away due to profitability concerns. Analysts at Edgewater Research noticed the changes and wrote in a September research note that Amazon had “essentially turned off its Add-On program in recent months.” The category of products likely to be most impacted by the changes? Consumer packaged goods — or CPG items — which encompass everything from deodorant to toothpaste to shampoo"...

Giant Food Unveils Giant Delivers
PG: "Giant Food has refreshed its Peapod by Giant grocery delivery service as Giant Delivers. The name change is part of the grocer’s “The Little Things Are Giant” platform, which aims to help customers save time so they focus on more important matters.The service, which encompasses ordering via web or mobile app, provides next-day home delivery of groceries to an area where more than 6 million shoppers live in 300-plus ZIP codes across the District of Columbia, Maryland and Virginia.Giant Delivers recently introduced same-day delivery within the downtown D.C. area and Giant Pickup, which enables customers to place grocery orders online and have them loaded into their car in as little as four hours at a local Giant store. Pickup rolled out this past July and is currently offered at more than 65 locations, with a total 100 planned for Washington D.C.; Maryland; Virginia; and Delaware by the end of 2019...

Is BOPIS a Good Fit for Dollar General?
RetailWire: "Dollar General was late to the game in launching e-commerce in 2011 but continues to invest in its digital strategy largely through its app, including recently adding digital coupon push notifications. About 75% of the chain’s stores offer Cart Calculator, a feature that allows customers to use their phones to scan items as they shop to see a running tab. Mobile checkout is just starting to be rolled out. Approximately 45% of DG's shoppers use digital tools from the retailer or other merchants when they shop, according to the company. “Digitally-engaged customers” check out with baskets twice the company average, although Dollar General’s average basket size is $12 or less, containing five items or less on average.On DG's Q2 conference call in August, CEO Todd Vasos, said the smaller basket size is the reason for a “slow” test of BOPIS [buy online, pick up in store].“It’s a little bit different shop than what you would find in a big box retailer. And so buy online pick up in-store will be no different. It will be a different shop,” Vasos told analysts. “But what we believe we can do is offer her another leg of convenience. So that she can come to the store, pick up what she needs, probably add an item or two to her online pickup and then be able to get out very, very quickly.” For Walmart and Target, online, backed by aggressive BOPIS efforts, has been by far their fastest growth channel and is seen as a competitive advantage against dollar stores. The primary reason BOPIS is expanding in appeal is because consumers want to avoid delivery costs. Secondary reasons are to receive their goods faster and take advantage of promotional offers"...

Walmart Is PG's Retailer of the Year
PG: "Among retailers that sell groceries, Walmart has been head and shoulders above the pack in the reinvention of routine buying and selling. It’s one of the reasons that Progressive Grocer selected the Bentonville, Ark.-based mega-merchant as its 2019 Retailer of the Year. And it’s not just about the consumer’s time — it’s about the associate’s time, and finding ways to make their job easier so they can focus more attention on the shopper.“We’re learning how to work in an agile way,” McMillon said in his June stockholders address, “with customer experiences designed thoughtfully from the start, and with technology doing more of the work so our associates can focus on customers and members.” One of Walmart’s latest efforts: solving the last mile, or rather, the last few feet of the last mile. The retailer is piloting in-home grocery delivery to nearly 1M customers in three markets: Kansas City, Pittsburgh, and Vero Beach, Fla. All deliveries are done by associates with at least a year of service. Customers are notified upon arrival and can watch a live first-person view of their delivery, or a recording of it later... “We're trying to understand customers’ appetite and whether or not that’s a process they enjoy,” Tom Ward, SVP of digital operations, tells PG. “For the small test that we’ve got right now, people really love this service. It’s something we’re going to continue to experiment with""... Article goes into depth about Walmart's strategic initiatives.


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