Meredith’s magazines include some of the biggest in the industry in terms of circulation—but less than half (47 percent) of Meredith’s publishing group revenue (now called the National Media Group) comes from advertising. That’s in large part due to Meredith’s growing integrated marketing unit, which creates customized programs for advertisers using assets like custom publishing, direct marketing and word-of-mouth marketing. Since expanding beyond traditional custom publishing in 2006, Meredith Integrated Marketing more than doubled revenue to $175 million in the company’s fiscal year that ended in June.
Brand licensing is another growth area. Licensing revenue grew 14 percent to $25 million in the last fiscal year, driven mainly by the company’s expanded relationship with Walmart. The company is selling 1,500 Better Homes and Gardens-branded items through Walmart stores and planned to expand to Canada in the second half of this year.
Among other sources that bear watching are membership clubs that build on Meredith’s expertise in the home space. The company already has launched quilting and gardening clubs in the past year, and wants to create clubs in other categories, including woodworking.
Dave Kurns, director of business development, Meredith Interactive, says both clubs are profitable, with several thousand members signed up. Members of the quilting club, Inner Circle, pay about $63 for an annual membership, which includes a book, calendar, bag and poster, although that price will likely come down. The Garden Club, which charges about $10, includes special offers from advertisers and live chats with editors.
Like other magazine publishers, Meredith also is developing premium level Web content for which it can charge consumers. It recently rolled out Decoratinginspiration.com, where visitors pay $19.95 for three months to access thousands of home decorating images. The price includes a year’s subscription to Better Homes and Gardens. In June, it introduced BHGlifeinphotos.com, a scrapbooking site where visitors can create keepsakes like scrapbooks, photo books and digital movies. Meredith shares the revenue (the average order is $85) with its production partners.
The clubs and sites are still small in terms of membership and traffic, but Kurns hopes to grow them into a meaningful business in the next few years. “We’ve always had a very deep relationship with our consumers,” he adds. “We’re trying to increase touch points with them and develop new revenue streams…to weather the storms.”
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