The Atlantic’s change in fortune is impressive by today’s publishing industry standards, but it’s all the more so considering the periodical, a 154-year-old journal on politics, culture, science, tech, and world affairs, belongs to a small group of so-called “thought-leader” publications like The New Yorker and The New Republic that are better known for their intellectual contributions than their commercial value. By rethinking everything about the company, however, Smith found a way to make that pay. Think Silicon Valley, but without the free food and massages. (Smith did away with perks like free bagels in the mornings.) “We don’t have foosball machines, but we filter for entrepreneurial talent,” Smith says.
He wanted to make The Atlantic a place where the traditional wall between the editorial and business sides could be broken down, but in a way that would encourage innovation, not stifle journalistic independence. In a show of transparency, Smith, with Bradley, started giving employees financial information at quarterly town hall meetings. He created joint editorial and business groups to incubate new ideas that have spawned sites like The Atlantic Wire, a news and opinion aggregator; and the new Atlantic Cities, the brand’s first stand-alone, single-topic site, devoted to urban issues.
Pivotal to the turnaround was Smith’s decision to lure Jay Lauf from a plum job as publisher of Condé Nast’s Wired. Lauf told salespeople it didn’t matter how much they sold in print or online dollars, as long as they met an overall revenue target. Digital advertising went from contributing 9 percent of ad revenue to a projected 45 percent this year. Print ad revenue, meanwhile, grew 24 percent in 2010 and is projected to be up 7 to 10 percent this year. Lauf said while his salespeople lured digital-focused advertisers by emphasizing digital properties, clients still wanted print. “A lot of the conventional wisdom was, you’re going to take your eye off print and you’re going to trade dollars for dimes,” he said. “It hasn’t cannibalized the print; it’s actually bolstered the print.”
The edit and business sides of publishing historically can be at odds, but James Bennet, editor of The Atlantic, says he feels the two speak with a shared vocabulary. When he’s asked for resources to expand editorial coverage, Bennet says, “we’ve gotten more ‘not yet’ than we’ve gotten ‘no.’ That’s what’s made this work so well.”
The teamwork can be seen in the joint meetings Smith regularly holds with his top editorial and businesspeople. They toss out ideas and try to find ones that would make sense for readers as well as advertisers. Smith takes pride in the harmony that pervades these meetings. At those times, he says, he can close his eyes and not know if the speaker is from the editorial or business side. “We’ve created a process where everyone’s in the boat rowing the same way,” he says.
Smith is now actively looking to launch other Atlantic verticals on sports, science, tech, and business (the last of which The Atlantic had planned to introduce before, but tabled when the economy soured). “Our vision is to have a general-interest brand at the center, but then we’re going to be deploying our editorial lens against a business model that makes sense,” he says.
Smith has also been successful in finding different sources of revenue for the company. He’s expanded The Atlantic brand’s events business, which includes the Aspen Ideas Festival; this year, that business will account for 14 percent of the company’s total revenue, up from 6 percent in 2007. He added the Washington Ideas Forum three years ago; next year, he’s bringing a similar event to New York. And having seen other publishing companies get a bigger share of marketing dollars by offering more services to advertisers, he recently started a marketing-services division.