TRANSCRIPT OF INTERVIEW

CIRCULATION

we have a relatively small circulation but they are very serious in their interest in history and loyal to many of our magazines.

ADVERTISING
while we seriously seek advertising as a resource, our current operation does not depend on it’s survival. To succeed as any business must we have to expand our income annually thus our goal is to bring in much more advertising as well as circulation.
We came in under budget this year. meaning we expected to loose money but we loss a lot less than the budget we planned.

NEWSSTAND SALES
with many of our magazines we are doing well.

SMALL STAFF
a mix of talent but all hardworking and loyal.

WISE STRATEGY
SMART PUBLISHER WITH DEEP POCKETS
AND A SMART EDITOR IN CHIEF BOTH WITH GREAT EXPERIENCE AND WISE INSTINCTS
Eric Weider comes with experience from a successful publishing family, a passion for history and is willing to invest his time, talent and money to see this company to success.
Steve Petranek is great to work with. Very smart, savvy and knows how to read readers wants.
Lots of valued experience. He created This Old House Magazine. A big success story.

WE’RE about 50 people
> an even mix of cultural, friendly, generous,
smart and talented women and men.
> a mix of ages from early 20s to one 80 I’m 68.
friendly gatherings:
> pizza/ soft drinks lunches in conference room everyone invited.
> various celebrations, cake, coffee, soft drinks. everyone invited.
> editor-in-chief talks to staff meetings pastries & coffee.
> kids and dogs allowed to spend day if necessary.
> ping-pong table
> tables and chairs removed from conference room each Wednesday
for an hour yoga session.
> small groups—a mix of people—from different
magazines/departments go out for lunch to be social.
> free coffee, tea, snacks in two kitchen areas.
> inexpensive vending machines.
> communal newspapers and other magazines.

Eric Weider went to work for his Uncle Joe Weider at Weider Health and Fitness about 25 years ago fresh out of college

Sold exercise equipment and nutritional supplements – body building protein

Most publications did not want to take their ads so they started own health magazine

14 magazine – under direction of Eric (originally just body building with no other appeal..expanding them out to magaizine like SHAPE (1.5 million)

made very successful

In the late 1990s/2001 when magazines were still considered a very valuable property –

“ a company called American Media came along and offered the Weider’s a price they could not refuse”so they sold the magazine

Eric – kinda bored – His father was a Napoleonic scholar- he had a great interest in history

And also video games (most war) – started magazine ARMCHAIR GENERAL

Critical point – war like action, what would you do.

Board game industry -- Avalon Hill

Mentality – pretending you were napolean at waterloo and what would you have done

Eric – 6 times a year

Steve hired as institutional consultant for it

Did not get over 30,000 – couldn’t make enough money to hire its own business side staff, production people, additional ad sales team, circulation director

Key critical support system in magazines weren’t available to them

Eric believed that if Americans knew more about their history and understood it better they would be much better citizens.

Went to newsstand and noticed all of these history magazines – “noticed there was a group of 10 of them that had been cobbled together from two independent publishing companies and purchased by Prime Media Magazine Company

Eric talked to steve and asked if he was willing to work with them to make them better – editorial leader of the magazines

“At the time I didn’t know this but if I had turned down the job he wouldn’t have bought the magazines”

steve agreed but didn’t think it would happen – because Eric wanted the magazines for a very low price, and I (steve) knew that Prime Media would laugh at that price…but he waited until there had been three complete changes in upper management at Prime Media

Prime Media company that owns over 500 different magazines..and for three years in a row they fired their CEO and all of their upper management. After the third year of firing, Eric swooped in and gave his offer – predictably they laughed at him and said no, I (steve) kind of thought the deal had gone away but about 6 months later they said yep we’ll sell it to you. March 2006 Eric bought the company.

By having 10 other magazines, the company could now afford the things it once was unable to have.

Suggested that you close down 5 magazine

“ we decided from the get go that we would not do that. We felt that we had a lot to learn and that all of the magazines had a lot of potential”

but they were in very bad shape. Prime Media had bled them dry of resources and financing.

Within 3 or 4 years if eric had not bought the company, the magazines would have been folded, if not about 8 of them.

“When we walked in the door with them, we faced really primative magazines, that had really been stripped of a lot of resources” STRIPPED OF STAFF

the only way that the 30 or so people working there could produce 10 magazines was to produce them like a factory

so they would have word people who would edit the stories and then hand them over to the art people, who would be the next part of the assembly line. And the art people would design the space, find the art, and plug the story into the art and they would again pass it on to a production team to make sure, you know, that all the I’s were dotted and the t’s were crossed; that the art was going to work and that it was on the page properly, and so forth…and then they shipped it off to the printer. So it was kind of like a sausage factory.

And I turned everything around there. If theres anything that defines whats really behind our success its our devotion to quality. Then we had kind of two choices when we walked in the door. We could have spent 2 to 3 times as much as Eric paid for the company to get all of the magazines up to being serious national publications of great content and great visuals. And that would have cost times what we paid for the company to do that quickly or we could make the magazines better with just good leadership and smart thinking and knowing what we already know about the magazine industry and what makes magazines good and invest some money but cerate much better quality products and then wait for that quality to translate into more advertising more subscribers more news stands sales, and Eric chose to go that direction instead of plopping down 10s and million dollars to go and find the best magazine people that I could find and hire them. And in retrospect I think that was probably a smart decision. Our focus was on quality. Both on appearance, readability and narrative drive. We also did something else which was, well we did a bunch of things, first of all we perceived immediately that we were thought of as war magazines and in order to alleviate that impression, even though you cant change the title of a magazine called World War II to something else , it still is about WWII. We tried to assign more stories that were social history. One of my favorite that ran in Military History as an indication of what we were trying to do was a story about the fact that Napoleons Army was actually a third larger than it appeared to be in number of soldiers. That extra third was women who traveled with the army and in the early 19^th century in France sweethearts and wives would follow their men to the battle set up the tents, do the cooking, create a home so to speak. And then the next day the men would go off to battle and then when the battle was won, everyone would pack up and they would move on again. To me this was a social history story: that napoleons army was really a third larger than anyone thought It was and the other third was women! And that it was these women who were taking care of their men who were going off to battle and who traveled with the army that really made Napoleons army a success. So rather than that being a battle story, like would be typical of a magazine like Military History in the past, we turned it into a social history story in which we showed how the way people were behaving and in ways that you had not heard before – was really interesting and valuable to know. Another thing we did was we went for pure journalism. In other words we tried not to do any article that essentially repeated history we didn’t write about Gettysburg and tell you what happened at Gettysburg in kind of a blow-by-blow thing…instead in order to publish something about Gettysburg, which we do try to do each year because it was such a significant battle in the history of the United States, before we print it we have to find something new and important to say. So we are constantly involved in research and in good journalism to find what’s news. Another thing we do is we create a narrative drive. In other words, there are a lot of stories in science and history publications and other publications that are like our magazine that don’t tell a story. The story does not have a beginning, a middle and end…etc. Another thing that we did is we broke up the sausage factory into separate staffs, so there are separate staffs for each magazine…a very small staff, but there is one for each magazine. And that through the power of the editors likes and dislikes and the other few people on the team, and their likes and dislikes, gives the magazine additude. In other words, most of our magazines reflect the additutes and desires and sort of day to day life constructs of the editors of that particular publication. If I’m editing military history and I’m not interested in the history of France, youre not going to see very much about the history of France just in the pages of the magazine. But if im fascinated by the history of Russia you’re probably going to see a lot of pages about the history of Russia. That gives the magazine a different personality and personality is what you get when you have very specific people who work on one publication.

Our news stand sales have gone up dramatically in these four years. And our renewal rates, in other words the people who after they get the magazine for a year actually fill out a check and sign up for another year is extremely high. In this business there are very few magazines that have what we call a renewal rate that is better than about 50 to 60 percent at best, and we have in the 70s. Our renewal rates are in the 70s. So people have really responded to the changes that we have done with the magazine. And we took Two of our top magazines WWII and Militarry history and put them on much better paper, made color available on every page, we oversized them, and we made them perfect bound which gives them that square back instead of being stapled and makes them more book like. And we quadrupled their budgets. When I got there almost none of the stories for any of the magazines were actually assigned by any editors. What they waited for was bad writers who couldn’t get published anywhere else to send them manuscripts on speculation, and then they would file them. They had hundreds of these kind of stories that they filed away that like bored laywers had written. And when they wanted to put a magazine together they’d just go to the file cabnit, pick out stories with some diversity and variety from the many that they had in there that had kind of come in over the [transom?] And then edit them. And they were horribly written most of the time, and they would do kind of glorious copy editing on them and put them in the magazine and shove the magazine out the door. Our approach has been entirely different. A magazine ought to be fun to read, it ought to be challenging, it ought to be interesting. You should walk away from it feeling like you know a heck of a lot more than before you started reading.

We’ve kept our audience further refreshed. WE’ve gained in advertising revenue. We are selling national advertising now and the magazine never carried national advertising before. Our renewal rates are up. We are amoung a very small group of magazines that have continuously sold more magazines on the news stands in the last 4 years. Most magazines are down about 40% in news stand sales, we’re up 40% over the last 4 years.

Are most sales from News stands?

No, news stands is only about 20% of our total revenue, and about 70% of our revenue is subscribers. Very loyal subscribers. Who have not only stuck with us as we’ve reinvented the magazines – which is a very dangerous thing to do, because you tend to lose a lot of subscribers because its quote it is not their magazine anymore, but they’ve not only stuck with us but they have shown it to their friends and their friends have ordered copies and our subscriptions have gone up.

In our total money coming in the door, we are about 10% advertising income, about 70% subscribers and about 20% newsstand. Newsstand is kind of a leading factor in magazines because if youre doing well in the news stands and your sales are increasing on the news stand it is a direct indication that people are choosing your magazine over other magazines. And if your newsstands are going up your subscriptions will usually follow.

CLIENTEL?

Well we don’t know for sure. We know that they are generally older and the average age is some where in their 50s. They are people who have more time on their hands to read. They are people who did not grow up in an electronic reading enviornment so they prefer to read as opposed to watching television or reading on a Kindle or something like that. They tend to be very well educated. We have an extremely high proportion of readers with advanced degrees and they have relatively high income, much higher than.. we are probably in percentile amoung household income of subscribers who probably somewhere in the 80s. In other words about 85% of all magazines have readers whose household income our lower than ours. Our readers tend to be fairly well off, and they tend to be well educated, and they tend to have the time to read because they are older.

MAGAZINES

American History

Civil War Times

Wild West

World War II

Aviation History

American Civil War

British Heritage

Military History

MHQ – Military History Quarterly

Vietnam

ECONOMY

We have been very successful in getting new national advertising but we have been less successful in getting direct response advertising. In other words, the kind of advertising were someone makes replica WWII bomber leather military jackets and sells them in a magazine like WWII. In other words, these smaller companies that are advertising for specific products. And the reason they call in direct response is they are hoping you’ll call the 800 number in the ad [?]. That was by far the bulk, that was all, the only kind of advertising the magazine had. when we first got there we hired a national advertising sales director and then we started getting ads from the likes of insurance companies and the stuff like that that had a national audience. However, the smaller mom and pop companies that advertise the lot in these magazines have mostly gone out of business from the recession. You know, when someone is choosing whether to order some product they don’t really need out of the magazine or to have enough money to survive being unemployed for six months, they choose not to buy whats in those direct response ads. So a lot of those people have gone out of business, and that has hurt us. We would have, We have not made any money when we bought the company and the company was profitable when we bought it. There is a major investment that we are making in the future, and it does seem to be paying off. We can actually make projections now that we will be profitable within a couple of years. So we think we have taken all the right steps. You cant have the income indefinitely if you don’t have the quality. Quality costs money but the quality will produce results. The problem is it takes a while. When you go out and reinvent a magazine that’s a piece of junk and make it fascinating to read and beautiful to look at, people are not going to knock your door down in the next two issues trying to buy it. It takes awhile for them to become aware of it and to be reintroduced to it and to find it attractive enough to buy. So its always a slow curve. So it has hurt us that so many of our direct response advertisements have gone out of business.

FUTURE?

There’s no question that print is threatened and that print is declining. But in magazines there has been a model that arose in the 1960s and early 1970s and that was greatly flawed and that model was to practically give away your magazine at almost any price, so that you would have very high circulation. And then you could go to a major advertiser that had deep pockets and charge them a lot of money for an ad because it would be worth it to them because so many eyeballs would see it. What we have come to find is that advertisers are more convinced by having a targeted audience than necessarily a mass audience and when they go for a mass audience television is more efficient by large than any kind of print. That is a problem that in general that is hurting magazines. And a lot of magazines are switching their formula. It wasn’t very long ago that you could buy the New Yorker on the newsstand. Just a couple years ago you could buy the New Yorker on the news stand for $2.99 now its $5.99. All our magazines our $5.99 on the news stand and when we went to $5.99 two years ago there were very few other publications that cost that much and our magazines tended to be thinner and frankly not as attractive in many ways because we were just getting our quality feet on the ground and beginning to produce better magazines. The model is switching, and the model is switching to charge the consumer whose reading the publication what it takes to support your company and if what you’re doing is worth that much money they will buy it and you will be successful. And that’s a very new model.

HAVE YOU GONE ALONG WITH TREND?

We are changing all the time. We’re trying to sell national ads instead of direct response ads. Where we are headed is to provide an extremely high quality experience in an extremely high quality publication. And to charge a heck of a lot of money for it. In other words our circulation of most of our magazines is not that large right now and we can go one of two ways: we can keep the prices of the magazines relatively low and grow the amount of overall circulation we have or we could charge a lot more money for the magazines and only those people who think its worth reading the magazine will continue to buy it and subscribe to it. But since we will charge them so much more money we will actually make more money doing it that way. So we are headed for a direction of a high cost publication that delivers high quality. And we think that could be successful.

CONCERNED?

I would say I’m not. A lot of my friends, when I left new york to go work on magazines who are very low circulation magazines that not many people had seen

I love my job.

At Weider History we have savvy, smart leadership
and a group of talented people to share a day with putting out
a product—10 magazines—of which we are very proud.

It's a relatively small collection of good people that enjoy working together
and are able to, and encouraged to spend social activity together in the form of
lunches at nearby favorite restaurants, various catered celebrations in our conference room;
a ping-pong game on the first floor of two;
a free yoga session on Wednesday; and
good talks with colleagues as a regular pleasure.
We learn from each other.
That's what it's like at work.

As I said, I love my job.

Rudy Hoglund, design director

I AM NOT SURE IF THIS IS OKAY, IN TERMS OF ONLY GOING WITH STEVE P (WHO I INTERVIEWED) AS MY SOURCE. HE SUPPLIED REALLY GREAT INFO THAT CAN HELP IN TERMS OF COMPARING THEIR COMPANY TO OTHER LARGER COMPANIES.