When the Newhouse family brought in veteran media executive Roger Lynch in 2019 to manage their company’s crown jewel, Condé Nast, he inherited a fiefdom business. To be Magazines, infamously, competed with each other for advertisers and cover stars, while Condé’s international business was its own silo. Lynch, now three and a half years in the service, has sought to unite the company into one organization and shifted investments to digital and video, growing a legendary magazine company brand into a leading player across multiple platforms.
I know video is a top priority. You hired Agnes Chu from Disney to run Condé Nast Entertainment. How do you feel about investing in that space?
You start with the pretty insatiable demand for quality content coming from streaming services. But the emphasis is on high quality. They fiercely compete with each other for the best content. And the biggest limitation is the ideas, the intellectual properties. That’s why you see so much of what Hollywood produces are essentially sequels and prequels, bringing back an idea from the ’70s. What we have is a huge trove of IP, and we add to it every day. And some of that found its way into film and TV, but not really through us. Brokeback Mountain, Argo, these were originally stories that started in our publications. But we didn’t really have a team that our writers wanted to work with, or that understood how to really build that business. And so we called in Agnes; she brought an entire team under her and they completely turned that around. Now some of our top writers seek them out on ideas in film and television. And the buyers on the other side do too.
What is the trade-off between the types of content you produce?
The editors of the future really need to be people who can work with video, print, digital, social media, and so we’re really focused on driving that alignment between them. So you’re going to start seeing more of our stories that can happen in video as well. The New Yorkers did a piece on these re-education camps in China for the Uyghurs, and so they did a virtual reality video project: It told the story using video in virtual reality, and that’s a great way to use a skill technology to create a. tell a story in a really creative way rather than just in a printed article. So you’re going to see more and more of that over time.
How do you grab a brand like Fashion or Wired or The New Yorkers and figure out what type of video content or movie projects make sense to be attached to that brand?
We have 1,800 people at the company producing content. There’s so much intellectual property being produced that it’s largely an exercise in looking at what’s in the works or out now and figuring out how to create that opportunity in film and TV. It’s even earlier in the process now, where we’re getting better integration between our film and TV business and our editorial staff, where they’re looking at how they can develop something together. We now have projects where a story breaks and we’re announcing the production deal. It has already happened. So it is much more closely integrated.
How big do you think that could really be for Condé Nast? What will be the revenue mix between video, print and digital?
Last year we kind of hit the tipping point where digital was the majority of our revenue, and it’s only grown more this year, so we’re way past where it’s the majority of our revenue. Video is one of the fastest growing parts of our business. It has grown by about 30 percent in recent years. And we kind of expect video to be about a third of our business over the next several years, consumer revenue to be about a third of our business, and then a third to be traditional ad areas. This is how we think about the mix of our company that is changing. Print ads were two-thirds of the company’s revenue six or seven years ago. It will be below 10 percent for the next five years, which is more or less on our plan; it doesn’t mean print is disappearing, but the advertising side of it is becoming less important, which means we need to have strong consumer business to keep titles like Fashion and The New Yorkers and Vanity purse.
Photographed by Rick Wenner
Are you evolving print in any way?
You have to differentiate between what consumers want and what advertisers want, because what we’ve seen on the consumer side is pretty strong demand for print magazines. Print advertising was in decline – well, it’s actually up to us this year. We don’t think it’s a growth business going forward. The vast majority of our readership is on digital rather than print. It’s not true for all brands, and there are brands that are out of print and have become digital only brands that have frankly become more successful as digital only brands like Glamor did, and To tempt also goes through that transition.
How do you balance the need to have scale and reach through a platform like YouTube versus the ability to maximize revenue through your own platforms?
YouTube remains a very important platform for us because of the wide reach it has. We sell all of our ads on YouTube, so we can sell them at a really high price because we have premium content. So our ad rates on YouTube are significantly higher than what YouTube can charge for their ads on YouTube because the advertisers know it’s in a brand-safe environment. And then I’d add to that, social is going to be a really important distribution area for us in video, whether it’s Instagram or TikTok, where we’re building a large audience.
How do you gain a foothold on these new platforms? And how do you stay on top of it so that you are relevant? TikTok has taken over the world in some ways.
We go where the public expects our brands to be and it’s very clear that TikTok is one of the places where the public expects to see our brands. And so we really see a lot of success with Fashion and other brands on TikTok, but you can’t just say, this is what works on YouTube, let’s put it on TikTok. It’s really a different format than what we produce for our websites or for YouTube, and that’s really crucial. You need people who understand these platforms, rather than people who just say, “I’m going to create content and we’re just going to distribute it across all platforms,” because that’s not a successful strategy.
Condé has iconic, established brands. But over the years it has also launched new brands [The platform Them launched in 2017], it has taken over brands. Are you thinking about expanding, whether it’s developing new editorial brands or seeking strategic acquisitions?
There might be brands that we don’t own that we can buy, but our bar would be very high. Because there are not many brands that have the size of our brands. We don’t just want to lower our quality level by saying, “We can get some audience here.” That doesn’t really fit into our business model. So we’d be pretty picky about that. Capabilities are another area. When I talk about all the areas we invest in, we always look at, “OK, should we build or should we buy or partner?” And so there may be areas where we look at acquisitions and help us build capabilities as part of this flywheel that I’m talking about.
The tech companies are having disappointing revenues and people on the TV side are starting to prepare for a tougher advertising environment. Are you preparing for a possible economic slowdown?
Yes, like most companies, we expect a slowdown, and to some extent we see it in some aspects of the business. But our biggest advertisers are fashion and luxury houses, and their businesses are very strong. They see no delay. And there are certain markets — like in China where they may have seen a little bit of that due to lockdowns, but overall their businesses are strong, so their advertising business is very strong. So we’re a little bit protected in those areas right now, but in broader ad categories, we’re seeing a little slowdown in some of those, and we expect 2023 to be a tougher time. That is why we are certainly more careful in our approach.
Photographed by Rick Wenner
Interview edited for length and clarity.
A version of this story first appeared in the November 16 issue of The Hollywood Reporter magazine. Click here to subscribe.