Friday, November 2, 2012

Martha Stewart Living Omnimedia puts title on the blocks, announces layoffs

It is never good news to hear about layoffs in our business. Yesterday's announcement by Martha Stewart Living Omnimedia (MSLO) seems oddly timed, as if Hurricane Sandy might provide PR cover for the media company.

The details are that MSLO would be laying off 70 employees, about 12 percent of staff. The company has also said it would make Everyday Food a supplement to its main title, Martha Stewart Living, to appear five times a year. Everyday Food has its own iPad edition, which has gotten pretty poor reviews due to bugs - whether that survives as a stand-alone title in app form is not known. Finally, MSLO would seek a buyer for its Whole Living title, and if can not be found the title would be shuttered.

"We have taken decisive action to drive the Company's return to sustainable profitability, in part by reducing our costs for production and distribution and in part by creating even more engagement with our audiences, and better and more valuable opportunities for our advertisers," Lisa Gersh, President and Chief Executive Officer, said. "The initiatives announced today, coupled with those we've taken over the past year, further the emphasis we have been placing on digital, mobile and video platforms, reflecting our commitment to put our expert lifestyle content in closer reach of consumers, with greater frequency and in the ways they demand today and will expect even more in the future."
MSLO is shopping Whole Living

(One does wish that media executives would stop using digital as an excuse to chop heads. The issue here is not media transformation, but the fact that both publishing and broadcasting revenues were down hard. Clearly there are problems with publishing management here.)

But portfolio adjustments are not necessarily a bad thing, even though they obviously effect those involved. The problem with MSLO as a magazine company is that it basically has one brand – Martha Stewart – and therefore is not diversified. While I'm sure that those within the company see the titles other than Living as unique unto themselves, readers don't.

What MSLO needs is a few successful properties not associated with its main brand. It could do this by taking its knowledge of building a successful enterprise built around a personality to extend this to someone other than Martha Stewart, for instance.

The problem here might be that all the brands tend to attract the same advertisers. MSLO probably needs to broaden its base, grow its list of potential advertisers. It's obviously hard to tell if this is the case without a complete ad page report, but this is what I suspect, in any case.

In the meantime, rolling up a title into another title is not being committed to digital, it is the old media way of handing a consolidation. If MSLO's president were serious about taking a New Media approach the announcement would have talked about the Everyday Food app edition surviving as a 10-time a year tablet edition.