When Time Inc’s leadership and board of directors decided that they weren’t going to move forward with a sale. We thought two things. One, we weren’t shocked at all. And two, it’s time to show and prove. CEO Rich Battista has been in the corner office for less than year and his number two COO Jen Wong for even less. So it was understandable that the two wanted the chance to implement their plan to see if it would lift the company. Well, now they have that chance and all eyes are on them to see exactly what this strategy they want to execute will do. Unfortunately for some staffers, they will be shown the door because the company needs to cut even more cost to save money following a bad first quarter after the company came up short in its earnings report which was expected. In addition to looming layoffs, the company is now looking at smaller non core brands to sell off which will also help lighten the workforce and raise some much needed cash. This announcement of an asset sell off lead to the stock collapsing 20% as shareholders grew frustrated and unconvinced that the company’s leadership can turn things around. Some are even still upset that the sale was called off.
So what exactly is this strategy that Mr. Battista keeps speaking of. One investor demanded more about this strategy. He demanded numbers because at the moment there was nothing except talk. But the strategy from what the company has been executing so far is to enter new areas beyond magazines, something COO Jen Wong talked about earlier this year. Time Inc as we know it today is slowly morphing into a different company that will go beyond magazines and digital media. From what we see, the company is looking to morph into a company that operates in three areas, Media, Lifestyle and Services. We already know all about the media side with its iconic brands, digital properties and top shelf content. But the Lifestyle and services part of the company? Well, those business are now being built and its all on the backs of the legacy print publications. Because of these brands new businesses like Real Simple Clean and Real Simple Style have access to millions of consumers. The same will stand for any new services business like the recently announced influencer marketing network or pet health insurance that COO Jen Wong mentioned as a possibility.
There is really no limit to what Time Inc can offer their consumer base because they have the data to help them decide what those individuals are interested in. But, for now, Wall Street and investors don’t seem to share the same excitement as CEO Battista. The truth is the company has a long tough road ahead which Mr. Battista admitted, and unfortunately for them, they don’t have the luxury of not having to be laser focused on pleasing shareholders that rivals like Conde Nast and Hearst Magazines enjoy. So Mr. Battista and Ms. Wong have to be skilled in their balancing act of introducing new products/businesses while making sure they are on track to meet quarterly performance goals. One of the things Mr. Battista needs to be mindful of is the culture at the company. Under former CEO Joe Ripp Time Inc was the poster child of old top heavy corporate bureaucracies. But it didn’t start with Mr. Ripp. Time Inc for years mirrored its former corporate owner Time Warner when it came to culture and management style. Under Mr. Battista it’s not as bad, especially with digital first thinkers like Jen Wong who exudes the very culture Time Inc needs today. You can’t on one hand talk about building an entrepreneurial creative culture and then on the other hand, layer that with corporate bureaucratic approaches. Investors want to see some bold initiatives not necessarily safe ones. Get comfortable, lose the suit and ties and loosen up. The guys you’re now trying to emulate and in some cases compete with, don’t do suit and ties because that is the culture at their companies. Yes the business has to be managed and operated on a certain level but surely you don’t need a stuffy suit to do that.
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