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When the Newhouse family tapped veteran media executive Roger Lynch in 2019 to lead the crown jewel of their holdings, Condé Nast, he inherited a company of fiefdoms. Its magazines, infamously, competed with one another for advertisers and cover stars, while Condé’s international business was its own silo. Now three and a half years into the job, Lynch has tried to unify the company into one organization and has shifted investment toward digital and video, turning a storied magazine-company brand into a leading multiplatform player.
I know video has been a top priority. You hired Agnes Chu from Disney to lead Condé Nast Entertainment. How are you thinking about investing in that space?
You start with the pretty insatiable demand for high-quality content coming from streaming services. But the emphasis is on high quality. They’re in heavy competition with each other about having the best content. And the biggest constraint is the ideas, the intellectual properties, which is why you see so much of what Hollywood is producing is basically sequels and prequels, bringing back some idea from the ’70s. What we have is a massive treasure trove of IP, and we replenish it every day. And some of that was making its way into film and TV, but not really through us. Brokeback Mountain, Argo, these were originally stories that began in our publications. But we didn’t really have a team that our writers wanted to work with, or that had the understanding of how to really build that business. And so we brought in Agnes; she brought in a whole team under her, and they have completely turned that around. Now some of our most important writers are seeking them out about ideas in film and television. And the buyers on the other side are also doing the same.
What’s the interplay between the types of content you produce?
The editors of the future really have to be people who can work across video, print, digital, social media, and that’s why we’re really focused on driving that alignment between them. So you will start to see more of our storytelling that can happen in video also. The New Yorker did a piece on these reeducation camps in China for the Uyghurs, and so they did a virtual reality video project: It told the story using video in virtual reality, and that’s a great way to use a capability technology to tell a story in a really creative way rather than just in a print article. So you’ll see more and more of that over time.
How do you take a brand like Vogue or Wired or The New Yorker and figure out what type of video content or film projects make sense to be attached to that brand?
We have 1,800 people at the company who produce content. There’s so much intellectual property that’s produced that it’s largely an exercise of looking at what is either in the works or coming out now and figuring out how to create that opportunity in film and TV. It’s actually even moving earlier in the process now, where we’re getting better integration between our film and TV business and our editorial teams, where they’re looking at how they might develop something together. We now have projects where a story breaks and we announce the production deal. It’s already done. So it’s much more tightly integrated.
How big a business do you think that can really be for Condé Nast? What is the revenue mix going to be among video, print and digital?
Last year is when we sort of reached the tipping point where digital was the majority of our revenue, and it’s only grown more this year, so we’re well past where it’s the majority of our revenue. Video is one of the faster-growing parts of our business. It’s grown 30 percent or so in the past few years. And we sort of expect that over the next several years, that video will be roughly a third of our business, consumer revenue will be roughly a third of our business, and then a third will be traditional advertising areas. That’s how we think about the mix of our business changing. Print advertising, six or seven years ago, was two-thirds of the revenue of the company. It’s going to be below 10 percent in the next five years, and that’s sort of by our plan; it doesn’t mean print goes away, but the advertising side of it becomes less important, which means we have to have strong consumer business to support titles like Vogue and The New Yorker and Vanity Fair.
Do you evolve print in any way?
You have got to separate what consumers want and what advertisers want, because what we’ve seen on the consumer side is pretty strong demand for print magazines. Print advertising had been in decline — well, it’s actually up for us this year. We don’t think that it’s a growth business going forward. The vast majority of our readership is on digital rather than print. It’s not true for all brands, and there are brands that have gone out of print and become digital-only brands that have become frankly more successful as digital-only brands — like Glamour did, and Allure is also going through that transition.
How do you balance the need to have scale and reach through a platform like YouTube versus being able to maximize revenue through your own platforms?
YouTube remains a really important platform for us because of the scale of reach that it has. We sell all of our ads on YouTube, so we’re able to sell them at a real premium because we have premium content. So our ad rates on YouTube are considerably higher than what YouTube can charge for their ads on YouTube, because the advertisers know it’s in a brand-safe environment. And then I would add into that, social is becoming a really important distribution area for us in video, whether it’s Instagram or TikTok, where we’re building large audiences.
How can you gain a foothold on these new platforms? And how do you stay on top of it, to make sure that you’re you are relevant? TikTok has taken over the world in some respects.
We go where audiences expect our brands to be and it’s really clear that TikTok is one of the places that audiences expect to see our brands. And so we’re seeing really, really good success with Vogue and other brands on TikTok, but you can’t just say, this is what works on YouTube, let’s put it on TikTok. It is really a different format than what we produce for our websites or for YouTube, and that’s really critical. You need people to understand these platforms, rather than people who just say ‘I’m going to create content and we’re just going to distribute it on all the platforms,’ because that’s not a successful strategy.
Condé has iconic, established brands. But over the years, it has also launched new brands [The platform Them launched in 2017], it has acquired brands. Are you thinking of expansion, whether it’s developing new editorial brands or seeking strategic acquisitions?
There may be brands that we don’t own that we can look at acquiring, but our bar would be very high. Because there aren’t many brands that are at the stature of our brands. We don’t want to just lower our quality level to say, “We can acquire some audience over here.” That doesn’t really fit into our business model. So we would be quite picky about that. Capabilities are a different area. When I talk about all the areas where we’re investing, we always are looking at, “OK, should we build or should we buy or partner?” And so there could be areas where we look at acquisitions and helping us build capabilities as part of this flywheel that I’m talking about.
The tech companies have had disappointing earnings, and folks on the TV side are beginning to prepare for a tougher ad environment. Are you preparing for a potential economic slowdown?
Yeah, we, like most companies, are expecting to see a slowdown, and, to a certain extent, we’re seeing it in some aspects of the business. But our biggest advertisers are fashion and luxury houses, and their businesses are very strong. They are not seeing a slowdown. And there are certain markets — like in China, where because of lockdowns, they may have seen a little bit of that, but in general, their businesses are strong, so their advertising business is very strong. So we’re a little bit protected right now in those areas, but in broader-based advertising categories, we’re seeing a bit of slowdown in some of those, and we’re expecting 2023 to be a tougher time. We’re definitely being more cautious in our approach because of that.
Interview edited for length and clarity.
A version of this story first appeared in the Nov. 16 issue of The Hollywood Reporter magazine. Click here to subscribe.
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