When Jay Penske’s Penske Media Corp. bought show-biz trade paper Variety a couple of years ago, the media firm killed the daily print edition in favor of a high-end weekly paper. It revamped the website for breaking news.
Now, a similar formula could be applied to the bible of the fashion industry after the West L.A. media company’s announcement last week that it is buying trade paper Women’s Wear Daily.
Samir Husni, director of the Magazine Innovation Center at the University of Mississippi, said he expects Penske to make changes at Women’s Wear Daily that mimic the firm’s approach at Variety. He said going weekly makes sense given how breaking news has moved online. He added that the trade paper’s mix of investigative stories, analysis and supplements already makes it a good fit for an upscale weekly format.
“All of these things will be incorporated into a very upscale weekly fashion magazine,” he said.
Penske Media announced last week that it is buying the Fairchild Fashion Media portfolio of trade publications from Conde Nast for a reported $100 million. The other titles include men’s fashion magazine M, Footwear News and Beauty Inc., in addition to an events business. The deal is expected to close next month.
The purchase will significantly add to Penske’s presence in New York, where Fairchild is based and where much of the publications’ readership is located. Penske’s other properties include Deadline Hollywood, Hollywood Life and sites covering Bollywood.
By investing in print, Penske is hoping that an upswing in digital income and a new approach can help offset the industry trend of dropping print advertising. Advertising pages in magazines surveyed by the Publishers Information Bureau were down 4 percent in the first quarter of this year compared with the same period last year. There’s also a chance that Penske could cease publishing some of the titles in print to focus resources on the remaining brands.
The Fairchild titles in particular have lost significant value. Just 15 years ago, Walt Disney Co. sold Fairchild to Conde Nast, a division of Advance Publications, for $650 million. That deal also included consumer titles W and Jane, which were not included in last week’s deal
Jay Penske said in an interview with the Wall Street Journal that the properties he’s acquiring are strong brands that just need more investment.
Penske did not return a call from the Business Journal for this article.
Penske is the son of Roger Penske, a former auto-racing star who is chairman of Detroit’s Penske Corp., a privately held automotive empire that includes car dealerships and a namesake racing team.
Jay Penske’s publishing company began in 2003 as an online marketing firm that bought and then relaunched the Mail.com Web portal in 2007. Penske’s company, then operating as Mail.com Media Corp., raised $35 million in 2008 for acquisitions, and in 2009 bought Deadline Hollywood from Nikke Finke. The next year, Penske sold Mail.com to German firm United Internet. After that deal, he renamed the company and bought Variety for $25 million in 2012.
By focusing on print publications that cover Hollywood and fashion, Penske is tapping into two of the more resilient magazine categories, Husni said, noting that publications such as Elle, Marie Claire and Vogue have put out large issues this year.
“Don’t underestimate the power of those two categories – Hollywood and fashion,” he said. “Fashion is hot, hot, hot in print.”
Still, there is work to be done at Women’s Wear Daily. A source told the New York Times last week that Women’s Wear Daily has been losing money. Ilse Metchek, president of the California Fashion Association, also said she’s noticed a lack of advertising in the paper.
One opportunity would be to ramp up the paper’s West Coast coverage. Metchek said Women’s Wear Daily has largely ignored the L.A. fashion industry, which is known for boutique designers, and more recently the resurgence in men’s wear and denim.
Local industry coverage has largely fallen upon California Apparel News, a weekly based in downtown Los Angeles. But there is still not enough local coverage of the industry, Metchek said.
“There’s a big hole there,” she said, “for a publication that really deals with the issues of our (local) industry.”
Terry Martinez, owner of California Apparel News, did not return a call for comment.
Husni believes Penske is in a position to increase Women’s Wear Daily’s presence in Los Angeles due to the infrastructure already in place to produce and distribute Variety.
“Variety is dominant on the West Coast and Women’s Wear Daily is dominant on the East Coast,” he said. “There will be marriages of distribution and content that will bring both to each coast.”
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