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for market share
Fortune Small Business positions for ad recovery
By Jeff Bercovici
In the early months of this year, it looked as if small business magazines were poised to do well in the advertising downturn that was already clobbering their larger rivals.
Traditionally, tough times are good times for small business titles.
Alas, that didn't happen.
Now, after investing heavily in redesigns and other upgrades, the three leading small business books--Inc., Entrepreneur and Fortune Small Business--are locked in a fierce battle for market share.
As the newest of the three, Fortune Small Business might appear to be at something of a disadvantage in this fight.
Adding to that appearance was the magazine's elimination of its sales and marketing force.
But new publisher Hugh Wiley says retrenchment or no, Fortune Small Business is prepared to fight for a bigger piece of the pie.
"It's all about share-of-market gain for right now," says Wiley, who was formerly executive vice president of Time Inc. International, coordinating overseas editions of Time and Fortune and acting as a liaison between various units of AOL Time Warner.
Wiley replaces Kathy Kayse, who was recently named publisher of Money, another Time Inc. title.
Fortune Small Business, which two years ago changed its name from Your Company, increased its frequency from eight to 10 times a year for 2001.
This week, 14 employees who worked on the business side of the magazine or its web counterpart, FSB.com, were laid off. Those remaining, numbering about 20 in all, will join the sales and marketing staff of Fortune, and business operations for the two titles will be consolidated.
"What we’re doing here is designed to better bulletproof it against the down economy," says Wiley. "A lot of people assumed a lot of magazines were going to scale down or shut down, but I can assure you that was never really the case here at Time Inc."
During the surge of optimism earlier this year, Fortune Small Business, Entrepreneur, and Inc. all opted for makeovers, hypothesizing that the collapse of the dot.com sector and the disappearance of several New Economy titles would result in a renewal of interest in the more dependable small business market.
That optimism has since dissipated.
While the advertising recession makes any substantial ad gains unlikely for the foreseeable future, Wiley says Fortune Small Business has increased its market share by 8 percent, as rivals Inc. and Entrepreneur have seen their own shares slip.
FSB's pages were off by 5.1 percent, to 438.7, through October, and ad revenue was up 1.3 percent, to $33.6 million, according to the Publishers Information Bureau. Those figures, however, are partly a reflection of the title's frequency increase.
The most formidable player in the category, Inc., has also been the hardest hit.
Despite clear signs of an oncoming slowdown, Inc., now owned by Gruner + Jahr, spent the first part of the year ramping up, in an effort that culminated in a splashy September redesign.
Inc.'s pages were down 42.6 percent to 826 through October, with revenue down 41.8 percent to $104 million.
Entrepreneur, which also underwent a redesign this summer, is off 24.1 percent in pages to 1,172.4. Revenue is down 23.8 percent to $39.6 million. Wiley says it's impossible to predict whether the environment will improve much in 2002.
"I think it's too early to tell for next year, to be quite honest," he says.
"In some sense these small businesses are more diversified. The economy is going to turn on their heels in some ways quicker than with larger companies."
November 15, 2001
© 2001 Media Life-
Jeff Bercovici is a staff writer for Media Life.
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