WSJ Engages NYT over Luxe Bucks
Yes, the rich are different. They may disproportionately affect which national newspaper "wins," as the Wall Street Journal increasingly targets the New York Times’ readership and advertising dollars.
The latest shot in the war will be launched Saturday, as the Journal debuts its new luxe, glossy magazine WSJ. It seems to have a good start, 104 pages, trumpeting "19 new advertisers," out of 51 included in the issue. It’ll be a quarterly now, with plans to go monthly in mid-’09. The Journal says that nearly half of the
advertisers bought placement in all editions worldwide, and that many have signed
long-term deals extending into 2009 and beyond.
Make no mistake this is one of many double-edged marketplace moves. The Journal, like all newspaper-based companies, is struggling with ad revenues overall. It needs new revenue streams, and the luxury market provides one, though no one should over-estimate the impact of just 51 advertisers. 
Second, though, every dollar the Journal takes out of the luxe market, it may take out of the New York Times’ coffers. That’s a key strategy that we’ll see with each new WSJ marketplace move.
The Journal’s move follows major New York Times company initiatives in the same luxe area. Consider NYT CEO Janet Robinson’s comments in her June 10 comments at the Deutsche Bank Securities Media and Telecom conference:
"For example, three years ago, recognizing the strength of our
position in the luxury advertising market, we seized the opportunity to
redesign our Sunday supplemental magazines and rebranded them “T: The
New York Times Style Magazine.” These new publications have been hugely
successful with both readers and advertisers, particularly with luxury
brands. Even in a softer economy, luxury advertising has continued to
grow. Earlier this year, T: Women’s Fashion broke all records for the
number of ad pages and, year-to-date April, luxury categories such as
jewelry and fashion have grown.
Since the introduction
of “T,” we expanded its franchise in print, online and globally. Last
December we introduced “T” Magazine online, which provides a unique
platform for luxury brands. We have showed them how a great online
environment can help them brand their products, and advertisers such as
Bloomingdale’s, Gucci and LVMH Group have responded by purchasing
packages through November 2008.Last December The
International Herald Tribune launched its own international “T” Style
Magazine in Europe and the Middle East. Eight issues are planned for
this year….….Like The Times, The Boston
Globe has introduced new print products in areas where it believes
there are opportunities to garner advertising, especially in luxury
categories. This includes three new magazines and a new section on
money and careers."
So this is no new area for the Times, but one well-executed. The New York Times "T" brand is one we should expect to see a lot more of, in print and online.
Its efforts, and the Globe’s, point the direction that WSJ glossy is headed.
I’ve talked with Globe editors and managers and had a chance to review their publications (Design New England, Fashion Boston, LOLA) in print. They’re good ones, high in production and editorial quality. At least one — LOLA, a women’s magazine, is produced by newsroom editors. Others are produced by those working for Boston Globe Media, a business arm of the Globe. Importantly — and here we see a future-grabbing model — the Globe’s got a cross-divisional Innovation Group that hatches and then warms up good reader-pleasing/advertiser-satisfying ideas. These luxe magazines display the flexibility that modern news companies will need. They vary in who produces them. They vary in paper quality. They vary in page size, from 12 x 21 to 7 x 9. All, though, do their jobs. (It’s curious to note that the Globe is one of the few remaining dailies with an actual Sunday magazine. It apparently is doing well enough with ads — many shelter ones — to push on, and the magazine is almost a retro pleasure to read at this point.)
Niching, and higher-end niching, is certainly the order of the day. Our modern age lets us all specialize, readers and advertisers alike. So niching will continue apace, aided by increasingly sophisticated ad targeting. While both NYT and WSJ have enviable overall demographics for advertisers, the ability to further niche by readers’ specific buying interest is what’s in play here.
With today’s WSJ media splash, some have wondered about the timing of launching a luxe product in an economic downturn. The timing, though, makes a lot of sense to me.
First, as the Wall Street Journal itself has reported, "Luxury Goods Weathering Economic Woes in U.S.", luxury goods are holding up rather well, thank you. It’s an uneven
recession. Note, too, that WSJ won’t go monthly ’til ’09, when the
economy could well be better overall. Second, this is all about
positioning for the future. News Corp is making lots of moves — and
investing in — the Wall Street Journal long-term.
Want a good contrarian opinion on the value of the luxe market?
Again, we can turn to the Wall Street Journal — you can see what an
essential part of the news conversation it is — and Robert Frank’s
well-regarded Wealth Report blog. A post from March:
"In the latest wealth boom, luxury magazines became the new Red
Herrings. My desk is piled high with dozens of lush, glossy mags that
serve as catalogs for the super-rich…..You can’t blame the luxury-magazine executives for putting on a happy
face during the coming shakeout. That’s their job. But it doesn’t mean
we have to believe them."
The luxe battle is a fun one to watch. It’s best, though, not to
lose sight of the larger one between the Journal and the Times. Janet
Robinson recently estimated that
there is about an 11 percent overlap between Times and Journal readers.
News Corp plainly means to convince some of those readers that the
Times is no longer a must daily read. Its recent moves in becoming as
much a national/global news player as it is a business player are
clearly aimed at doing that. We don’t know the online overlap, and in
that war, a new battle’s about to begin.
On Sept. 16, the new WSJ.com launches. According to WSJ managing
editor Robert Thomson, it will have "lots of wonderful
gizmos" and provide providing access to free content. That redesign is
overdue, with WSJ.com looking a bit long in the tooth these days. Smartly,
though, WSJ.com has maintained its paid, subscriber base, while doing
lots of free access experimentation. The new WSJ magazine content is
one of many kinds of Journal content available free, either directly
from its site or through search engines.
Thomson put the WSJ launch in perfect perspective: "This is the first piece in that strategy."
