With Time Inc deciding to pull the plug on selling itself to the highest bidder, the company now faces more tough decisions. Two of those decisions will probably be whether or not to continue as is with its current lineup of products and workforce size. OK so its no secret that if lets say Meredith did end up buying Time Inc, there would be massive casualties. So sale or no sale, there was still going to be some changes at the nearly 100 year old company. The company’s announcement last week that it was no longer for sale, sent its stock price collapsing nearly 20%. CEO Rich Battista and his lieutenant Jen Wong now have to prove to Wall Street and shareholders that their digital first strategy will be much better than selling off the company. During the announcement last week, Rich Battista touted the company’s print ad revenue share as well its leadership position on the digital side saying in part:
We are excited to execute on our plan as we have become a leader in digital and remain #1 in print ad revenue share. In addition, our transformation has brought a number of potential partners interested in working with us to unlock and accelerate value across our portfolio of brands.
Part of that plan is the rapid diversification of some of its brands like Real Simple. In the space of less than two months, the Real Simple brand has launched a home cleaning product line called Real Simple Clean and a jewelry and accessories line called Real Simple Style. These launches seem to be part of a plan outlined by COO Jen Wong to sell more than just magazines and magazine related products to the company’s 30 million subscribers to create new sources of revenue. The Real Simple brand extension is just the beginning. Ms. Wong hinted that Time Inc may evan start selling pet insurance to its subscribers saying:
When you think about our 30m subscribers, we only sell them magazines today. If you think about the opportunity to sell other things to those customers, it’s substantial. Pet health insurance sounds niche, but it’s not really. There are a lot of pet owners. It’s a big opportunity and a great service model
Throughout the long bidding process, Time Inc continued to conduct business as usual like a company that wasn’t expecting to go through with a sale. Back in early April Time Inc announced that it was launching its own influencer marketing network in a buddy up with Speakr, which is a platform that helps publishers to create such networks. Though some believe the company’s true value is still within its print products, the company is moving rapidly to a digital first model which could mean a possible sell off or shuttering of some non-core print products and staff layoffs which the company won’t comment on. Meredith may have failed to land the entire company, but the Iowa based publisher of magazines like Better Homes and Garden and The Magnolia Journal could still end up with a title or two from Time Inc stable. Management is said to be eying $100 million in cost cuts which can only happen by cutting its workforce and/or folding or selling off some brands/divisions. However, Time Inc’s leadership won’t say where inside the company the cuts will be focused. But they are coming.