CondÃ© Nast CEO Chuck Townsend to the Troops: Keep Your Heads Up, and Your Expenses Down
Condé Nast is “having the worst year of any publisher,” the New York Post reported last month. So the fact that that CEO Chuck Townsend sent out an all-hands memo entitled “Managing Through Challenging Times” must have certainly sent a shiver through the magazine empire this afternoon.
The good news: Nowhere in Townsend’s missive does he actually mention sackings, reorg or other personnel cuts. The bad news: Townsend warns employees that “all of us” will “have to make additional difficult decisions to manage costs and ensure our financial well-being.” But he doesn’t spell out what those are.
Condé started hacking at expenses last fall by shuttering some titles and making cuts of five percent or more at others. Meanwhile, it has refused to cut ad rates, even as competitors pick up some market share with lower-priced pages.
But while there’s constant chatter within Condé about other titles supposedly destined for the chopping block, we’ve yet to see anything materialize. Condé’s cuts are roughly proportional to the ones that Time Warner (TWX) magazine unit Time Inc. also went through last fall.
Just this week, a Condé executive told me that because individual publishers were cutting back on costs without a companywide edict, it was unlikely that the Condé publisher would need to make bigger cuts this spring.
I’ll update if I get more info.
Click to read Townsend’s complete memo:
From: Townsend, Chuck
Sent: Thursday, March 05, 2009 05:04 PM Eastern Standard Time
To: Condé Nast Publications
Subject: Managing Through Challenging Times
I continue to believe that there are two things that make our Company truly unique, world-class brands and remarkable employees. This statement is even more true today as I watch how Condé Nast is managing through this challenging economy.
While advertising pages are down, Condé Nast is gaining critical ad revenue market share through the early part of 2009. Perhaps more importantly, our consumer connectivity, as measured in key circulation statistics, is particularly strong.
So, while our Company is not immune to the economic stress that has been experienced by the media community, we have made adjustments to secure our ongoing stability, just as each and every one of us has had to personally deal with the economic challenges we face.
Unavoidably, as the downturn extends, we have to make additional difficult decisions to manage costs and ensure our financial well-being. These decisions involve all of us. We’ll all have to do more with less and accept that some of the benefits and resources that were available to us in robust economic times will have to be scaled back–and revisited when the economy and our business recover lost ground.
The best course of action is for us to prudently and responsibly manage our business costs and expenses through these troubled waters, assuring us the opportunity to fully participate in the recovery that lies ahead. At that time, we will take great pride in what we accomplished.
I can only ask that you join me in these efforts to ensure the continued success of our great Company.
[Image credit: Malbonster]