You wouldn’t expect a bunch of fitness-obsessed muscle merchants to figure out a way to make money faster and more effectively on the World Wide Web than many of the nation’s publishing giants. But the folks at Weider Publications Inc. in Woodland Hills appear to have done just that.
Years ago, magazine and newspaper publishers began to fear that the age of paper was ending, so they started launching expensive Web sites to prepare for the electronic era. Most of them lost their shirts in the process and are still wrestling with a frustrating Catch-22: To put up a site that is attractive enough to get the mass audience that advertisers crave, you have to spend more money than you can recoup by selling ads on the site. And it’s very hard to get away with charging users to view the sites, although some are certainly trying.
“I don’t know of many (media) sites that claim to be profitable,” said Evelyn Hepner, vice president of sales and marketing for the Audit Bureau of Circulation’s interactive division. She lists CNN and Hachette Filipacchi Magazines Inc. as organizations whose Web offerings are reportedly in the black.
Weider, which publishes such magazine titles as Men’s Fitness, Muscle & Fitness and Shape, started making money from its online incarnation within three weeks of its test launch in early 1996. Since then, the company has invested heavily in its cluster of interconnected Web sites and is currently running in the red. But new media division Vice President Randy Gale expects to be profitable again within 60 days.
Weider has made the Web work through a combination of barter, cross-promotion and a marketing program with merchants of fitness products.
“I told the president (of Weider, Michael T. Carr), ‘I think we want to be on the Internet.’ (Carr) said, ‘Great, but I don’t want to spend any money,'” said Gale.
To test the Web waters, Gale made a trade with a company that designed and served Web sites. In exchange for a full-page ad in Weider’s flagship publication Men’s Fitness, the now-defunct developer provided programmers and servers and launched the initial Web site at no cost to Weider (other than the lost revenue of giving up a full page of ad space).
Three weeks later, the makers of Old Spice cologne called Gale and asked him, unsolicited, how much he would charge them to put a banner ad on the site. He figured $4,000 seemed fair, and the free site made its first profit.
“It told us there was an audience out there,” Gale said.
The next step was to create a master site that would link individual sites for all 10 Weider publications, at www.fitnessonline.com. At the same time, it would be a sort of clearinghouse for the merchants of fitness products.
More than 100 small companies that make such products as nutritional supplements or fitness equipment have paid Weider between $10,000 and $22,000 apiece to create pages for them on Weider’s site, generating over $1 million in revenues for Weider. The Web offerings didn’t start soliciting banner ads until about three months ago, but Gale says that since then they have generated between $250,000 and $500,000 in ad revenue.
Eventually, the company plans to begin selling branded Weider products through the sites, which are heavily cross-promoted through both house advertising and editorial content in all the Weider publications.
Hepner, who audits the Weider sites, says they generate about 5 million “page impressions” per month. (A page impression is when a Web user calls up an online page.) That level of traffic is not nearly as much as a general-audience site like CNN gets, but it’s a very respectable number. And Weider can get away with charging far more for advertising than other sites its size because of its audience.
“When you go to their sites, you can pretty much know that you’re going to reach people with a certain demographic profile,” Hepner said namely fitness enthusiasts, a very attractive audience for the makers of fitness products.
“I think if you’re in a vertical business (meaning your publications cater to a niche audience), and you have an offline distribution system, you would be foolish not to take advantage of the Internet,” Gale said.
NewLAMP’s last gasp?
The lame-duck New Los Angeles Marketing Partnership released its final ad campaign last week, this time pointing up the speed at which L.A.’s economy is growing.
Playing off last year’s tag line “It’s amazing what grows in Los Angeles,” NewLAMP’s slogan this year is “It’s amazing how L.A. is growing.” The print, outdoor and radio campaign will feature areas in which L.A. leads the nation, pointing out that the region is No. 1 in job growth, new businesses, trade traffic through the ports, manufacturing jobs, auto design and multimedia jobs.
NewLAMP has reached the final year of its five-year mission to promote business in the city, but it may go on in some form. NewLAMP Chairman Bob Lowe (whose day job is chairman of real estate development company Lowe Enterprises in Brentwood) said the organization is evaluating its own effectiveness and studying how its mission might best be continued in the future.
“The New Los Angeles Marketing Partnership is indeed, as its name suggests, a partnership, and maybe some of the work that it’s been doing should be taken up by some of its partners,” Lowe said. He wouldn’t get any more specific.
News Editor Dan Turner writes a weekly column on marketing for the Los Angeles Business Journal.
