Condé Nast Makes Ad Concessions for 2010

Condé Nast, which has been facing pressure from advertisers to be more flexible on rates, is seeking a 2.5 percent CPM hike in 2010, half its customary 5 percent.

The publisher of luxury titles like Vanity Fair and Condé Nast Traveler is known for asking for some of the highest increases in the industry, which it has justified by pointing to the quality of its magazines. Rival publishers have sought 2 percent to 3 percent increases in recent years, though by the time negotiations are over, it’s never certain they’ll actually see any of that increase.

But luxury advertising, Condé Nast’s bread and butter, has tumbled in the recession, resulting in steeper-than-average ad declines for the publisher in 2009. The company was forced to cut costs by 25 percent and close six titles including Domino and Gourmet this year.

Meanwhile, buyers say that Condé Nast, which has a reputation for being a rigid negotiator, has been more willing to make concessions to advertisers.

Yet one sticking point where the company apparently is holding firm is in charging higher rates for ads that bleed to the edge of the page. “Pushback continues,” said one buyer who has been asking the company to eliminate the bleed-ad surcharges.
Some buyers also noticed that, in a departure from the past, Condé Nast’s 2010 rate card doesn’t list separate nonbleed rates. Buyers wanting those rates have to request them.
“The rates might’ve only gone up 2.5 percent, but with the disguise of including the bleed charge in the regular rate for the first time, the uneducated eye might see their rate increase as 17.5 percent,” said Mike McHale, founder and chief media officer, Cleverworks, taking into account the 15 percent surcharge for bleed ads.
A spokeswoman for the Condé Nast Media Group, the company’s corporate sales arm, said: “We charge bleed rates, because the vast majority of our advertisers run full bleeds.”