Hearst recently opened a new 26,000-square-foot studio to ramp up its video production, a move that emphasizes the commitment the media giant has to becoming a digital-first company.
The new studio is a space that encourages the fluidity of today’s media age, with its multiplatform, multimedia demands. Hearst Tower, in contrast, was a space designed for an earlier media epoch, where editorial occupied its own separate spaces, and a private office was a coveted status marker, according to Hearst Magazines Digital Media global president Troy Young.
Aim high, start small and scale up
The path that led Hearst Magazines Digital Media to its new space is an example of the approach the organization takes toward innovation: aim high, start small and scale up. “We’re really iterative and we’re really ambitious,” says Young. “We don’t start with, ‘We’re going to make television shows.’ We start with, ‘How can we make video a little bigger part of what we do every day?’” That exploration began with social video of the postproduction variety and incrementally began to encompass everything from service videos to beauty to product videos to short docs.
That willingness to experiment is accompanied by a tolerance for the inevitability of failure. “We are not afraid to try new things, in print and in digital, recognizing that not all will succeed,” Hearst Magazines president David Carey tells Adweek.
Hearst Digital’s explorations have led to a presence on every distributed platform you can think of, from Facebook to Snapchat Discover to Amazon Echo to Musical.ly, where it was the first publisher to form a partnership with the app. “First there’s just a desire to innovate,” says Young, after which comes the reckoning. “We look really closely at the cost of serving the channel and the revenue potential from it,” he says. “We figure out how much money we can make and whether it pays for that as a new endpoint for us.”
For its efforts, Hearst Magazines Digital Media has some solid figures to flaunt: a combined 95 million unique visitors to its sites in October; 15 billion video views in 2017, a 161 percent year-over-year increase; and 143 million social media followers, a 23 percent increase over the previous year. And while many legacy publishers can boast equally impressive growth, Hearst Digital has been able to translate audience growth into monetary growth, both in terms of revenue, which in 2016 was up 40 percent from the previous year, and profitability. Hearst Magazines Digital Media has now been profitable for three straight years.
A transformative figure
Present for all three of those years was Young, who in 2013 was hired for a newly created role. In profiles following his hire, Young was cast as a transformative figure, prepared to disrupt Hearst Magazines Digital Media into a digital competitor that could hold its own among the pure plays, those media companies that have only known life in digital form.
“I thought if many of the impediments that came along with being a traditional organization, if we could get those out of the way, we could compete with the pure plays,” says Young of his thinking when he was hired. “So we needed a structure that got rid of obstacles.”
Structure itself was an obstacle, one that Young, along with svp and editorial director Kate Lewis, set out to change through the creation of a centralized desk for digital editorial staff. “If you look at our pure play competitors, “ says Lewis, “they have dozens and dozens of editors working under a single brand, and so, by uniting all of our individual editorial teams toward the common mission, we were able, and from a resource point of view, to be competitive with them.”
At the time, the idea seemed almost radical for a legacy publisher: a centralized news desk, where digital operates separately from the print side of a magazine and writers aren’t tied to a particular title but instead write across titles. Now, it’s common sense.
While the news desk was created out of a need to live up to the endless now of the digital age, its purpose extends further. “That group has shifted away from aggregating the daily stories to deep, actual, original reporting,” says Lewis. The altered focus is a response to audience demand, one that Hearst Digital is able to fulfill because of the bandwidth freed by the centralized structure.
Greater efficiency on the back end
Accompanying greater efficiency on the front end was greater efficiency on the back end in the form of Hearst’s introduction in 2014 of its MediaOS platform, something Young calls the “foundation to our business.” Along with serving as a content management system for all of Hearst’s digital titles, the platform also simplifies distribution, collects and analyzes data on traffic and views, and powers ecommerce.
It helps the org operate in what Young describes as a “competitive collaborative structure,” letting brands and groups learn from each other. And when a group or title is excelling in a particular area, it tends to set the organizationwide standard. An early example is Cosmopolitan as the standard bearer, per Lewis, for “what internet news needs to sound like.” Young points to food site Delish’s service videos and Best Product’s use of affiliate commerce for more recent examples.
Carey has identified ecommerce as an area of expansion, telling Adweek, “Like others, we’d like to drive more revenue from ecommerce, which Troy and Kate are leading. Our magazine media brands have long served as guides to the good life—what to wear, where to travel, what’s in—and we (and our peer set) can further leverage this credibility.”
For Young, the significance of Delish and Best Products extends deeper. They’re sort of proof of concept for homegrown brand creation. “This doesn’t happen often in big organizations where new businesses are created,” says Young. “We don’t wait to have to buy a company. We often just build it.”