Doubledown Trims Back on High-Flying Strategy

A year ago, Doubledown Media seemed to be flying high, expanding its fledgling suite of titles for the super-rich with the purchase of Private Air and launch of Corporate Leader.

Today, with even the well-heeled watching their wallets, those heady days are over. A September survey by Harrison Group and American Express Publishing found that the rich, twitchy about their personal finances evaporating, are foregoing luxuries and waiting for sales before buying.

Doubledown is trimming back, too, with print ad revenue growth having slowed to 20 percent in 2008 after doubling in 2007, according to CEO Randall Lane (his private company doesn’t release numbers). Twelve people, or about 23 percent of the staff, recently were shown the door, and about 10 senior execs were asked to take a 50 percent pay cut for 90 days. Lane said the company also is considering cutting the frequency of its four main titles (flagship Trader Monthly, Dealmaker, Corporate Leader and Private Air) to five times a year from six by eliminating a summer issue.

Doubledown has other issues aside from the fact that the financial sector is bleeding. Buyers said its controlled circulation model and brief publishing history could make it especially vulnerable in a constricting ad market.

Lane insisted the company is facing the same slowdown that’s impacting the rest of the publishing landscape. Doubledown’s backer and chairman, Jim Dunning, who has poured some $7 million into it, said that the company was planning to shift its focus to digital anyway, noting that he expects more than half the revenue to come from online sources in 2009: “Over time, it’s going to be less and less print.”

To that end, the company is placing its bets on social media, hiring Matt Melucci, former director of strategy at spirituality social network Beliefnet, to launch one of several social networks in January. The first, for traders, will provide a forum where traders can create events, pen blogs and search for other traders by specialty. Like the print magazines, which are free to recipients but require them to qualify, the networks will have a velvet rope.

Lane expects to make money on them through ad sponsorships and user fees for features
like access to its database of traders. “We think that’s the future of social media,” he said, “which is niche, and some filter as to who can get in.”