Can Sensible Meredith Become a Luxury Publisher?

Sales talk raises questions for InStyle, AmEx

Could Time Warner’s loss be Condé Nast’s gain?

Reports that the media giant is looking to combine its women’s magazines with Meredith Corp.’s make some sense: Time Inc.’s lifestyle titles like Real Simple and Cooking Light could combine with Meredith’s own heartland magazines such as Better Homes and Gardens to make a women’s magazine powerhouse. One sticks out like a sore thumb, though, and that’s InStyle.

It’s easy to see the value InStyle brings. Advertising by luxury brands is one of the few bright spots for magazines these days while their other mainstay ad categories like auto and pharma have stumbled. Seeing the opportunity in luxury, Bloomberg launched high-end spinoff Pursuits and The Wall Street Journal expanded its glossy WSJ. to 11 times this year.

Since the launch of InStyle in 1994, luxury advertising has consistently grown as a share of the magazine's advertising (now accounting for about 40 percent of its ad business, says the magazine). The March issue carried ads from brands like Dolce and Gabbana, Louis Vuitton and Gucci. InStyle also has added some Condé Nast glam, poaching Connie Anne Phillips from archrival Vogue in 2009 as its publisher. Under her watch, the monthly has outsold Vogue each year in ad pages.

A big question is how InStyle will fare under Meredith, which at its core is a mass-reach advertising vehicle and lower-budget magazine publisher. Its nearest competitor, Vogue seems best positioned to take share from InStyle if the product quality or leadership stumbles. (Then again, fears at Elle that it would lose its high-end edge after being acquired by Hearst Magazines in 2011 haven't really materialized; in 2012, Elle's ad pages grew 6 percent, per Publishers Information Bureau.) It seems leaner times have already begun at InStyle: Starting with its March issue, it adopted a narrower trim size. 

Another puzzler is what will happen with American Express Publishing. The company has leaned on Time Inc.’s expertise, resources and relationships to publish luxury titles like Food & Wine and Travel + Leisure via a 20-year-old management services agreement. Will AmEx go on its own, or continue its agreement in some form with a newly created publishing entity, and either way, will it be able to maintain its high-end standards? Whatever the outcome, competitors will be watching closely.