I was at the Folio: show this week in New York City. I spoke at the conference and was spoken to by many a strong, free thinking, radical member of a still evolving re-energized publishing community. It was, as usual, a thought provoking event, and I was delighted to attend.
Before I continue I want to explain something important about me that will come into play when I discuss my reaction to David Carey's keynote at the day-long C-Summit of the conference. I try to attend this C level meeting each year because of the excellent nature of the dialog between the C members in attendance. It is all high level nuts and bolts.
Here is where I tell you a short and I think relevant piece of Bo-history that circles back to the above mentioned conference. I started out in publishing with my life-long friend and original business partner Andy Kowl.
We started a newspaper together in 1971. Neither of us was trained for this adventure in publishing, but as it turns out fortunately we were both by our natures entrepreneurs, although we didn't know that at the time. We knew nothing of the established rules of business or publishing and just made it up as we went along as most entrepreneurs do. The only rule we understood was survival, and in this case survival by continuous ingenuity. We were, to say the least, true mavericks with unconventional approaches to the issues at hand. Andy and I have gone through the ranks of the publishing industry solving complex problems with simple, rule-breaking, alternative solutions. That is what we do. Our motto "There is no rule not worth seeing if it will break or at least bend."
That brings me to David Carey's keynote. He opened with the question: What's the biggest obstacle standing in the way of the magazine industry's success? The answer was we need to be careful about rules. Here he showed a picture of a mythical publishing rule book with a circle and red slash though it stating, "Our competitors don't follow any rules," and he went on to say that neither should we.
Well, bravo to David's opening broadside! David told me several years ago that he felt like a giant aircraft carrier that was being attacked by a thousand speed boats. I'm pretty sure he doesn't feel that way anymore. Later in the talk he said that when possible he tries to invest and partner with those trying to kill him. His examples of where Hearst has done so include investing in Vice, Buzzfeed, Refinery29, and AwesomenessTV. I know there are also other investments along those lines.
Then David told a charming story and asked the question Who built the Hearst Tower? Common knowledge is that the original six-story building was commissioned by the founder, William Randolph Hearst, and awarded to the architect Joseph Urban. The new 21st century tower is designed by the world famous architect Norman Foster. But they weren't the answer to David's question. He pointed out it was really Helen Gurley Brown, who reinvented and rejuvenated the languishing title Cosmopolitan into a power house. She had, as David pointed out, the "right message at the right time." Then the magic happened. It was the Cosmo profits that funded the launch of A&E, which in turn funded the investment in ESPN, which in turn funded Business Media Investments, which then went on enable the $1billion Lagardere purchase, and on and on it goes. The success of Cosmo empowered with thoughtful, dare I say entrepreneurial rule breaking, investments into a thriving juggernaut. Now David has created his own speed boat fleet to surround the carrier.
David had other insights to share with a room of publishing corporate generals. I think the number one suggestion was to embrace the business model of risk, followed by the advice to reject common business orthodoxies and do your best to leverage partnerships during these periods of disruption. As David clearly pointed out there is always room for another product.
Here are a few other thoughts worth mentioning:
1) New print products and digital now account for 35% of Hearst's media earnings
2) Digital is a profitable part of our business
3) If there is no friction between your print and digital strategies, you are not pushing hard enough to evolve your company.
4) Content is owned by the company not by the brand. Cross title content is distributed easily with all brands.
5) Magazine brands are the most famous small business in the world - consumers give us permission to enter new spaces
6) Management time and attention is a scarcer commodity than capitol. You must stop trying to fix unproductive businesses, unemotionally kill them off, and go out and create new products
7) The next 5 years will be more turbulent than the last 5 years. Media organizations must be skilled at confidently flying through the hurricane conditions
8) There is reverse mentoring at Hearst - the millennials are coaching and mentoring the senior staff.
With all that, I haven't mentioned the rest of the C-level event and obviously I won't get to it tonight. Let me just say it was a terrific event. Special mention has to be delivered to Peter Goldstone, CEO of Hanley Wood, who moderated the entire day's event from 10:30 am to 5pm. He did so with depth and style and congeniality. Not an easy thing to do.
And lastly, I wasn't going to mention it, but what the heck? The very first thing David said to the group was the following, "Every morning when I get up, the first thing I do is read three emails from BoSacks." Thanks, David. As biased as I might be, I think that might just be the best opening line to a keynote of C-level publishers I have ever heard.