Time Inc. staff are on eggshells as they await news of layoffs and smaller bonuses than in years past as the company faces declining revenue.
CEO Laura Lang, in a memo yesterday, has already told employees she would eliminate the usual 3 percent merit increase for 2013 as the company looks to “aggressively manage costs.”
Bonuses have been a point of contention in the past, when former CEO Ann Moore changed the formula to deemphasize individual divisions’ performance, which would have penalized people who worked for high-performing brands like People.
Time Inc. has already eliminated more than 1,000 employees since 2008, when the headcount was about 10,000 strong. This year’s layoffs are expected to be in the hundreds since the company’s had a reprieve since 2009, even as revenue has continued to decline. Both those years were marked by leadership transition: Jack Griffin became CEO in late 2010 and the job was open for most of 2011 after he was fired early in the year.
The company made $3.7 billion in publishing revenue for all of 2009, but through the first nine months of this year, publishing revenue stood at $2.5 billion.
Lang tried to put a positive spin on the situation, saying the company has gained ad market share and outperformed the industry and that new advertising products have been positively received. But the company has gone without a chief consumer marketer for most of 2012, cash cow People faces ongoing newsstand challenges, and video, where she’s placing a big bet, won’t likely yield any payoff for some time.