It's no surprise that Conde Nast is cutting back spending, particularly at Conde Nast Portfolio. After all, Time, Inc. is cutting more than 600 positions and the bloodbath will only get worse as the advertising spend drops further as we head into 2009. Conde Nast had been somewhat sheltered by being privately held, but there was little doubt they would have to cut costs as the economic situation worsened.
What is surprising (at least to me) is that the bulk of their cuts are being made to their online properties. According to the NY Times, Conde Nast will cut publication of the printed magazine from 12 to 10x per year, while "most of Portfolio’s Web site staff would be dismissed and that much of the content unique to the site would be dropped."
Portfolio is one of the few printed magazines to which I still subscribe. I don't read it cover-to-cover, but I've found it to be good beach reading - part serious, part fluff, but well-written and laid out.
What Portfolio had done well, however, was to develop a strong group of online blogger voices. And those blogs are the reason many readers come back to the site (or at least via RSS). While it's not easy to monetize those pages, they are creating an audience of users who visit the site on a regular basis and who provide the credibiity for the brand. I've previously named Felix Salmon's Market Movers blogs to my list of ten best financial blogs, but Portfolio also has interesting bloggers covering economics, media and other segments. It seemed that Portfolio was positioning itself well for the new economy while also supporting a traditional media business. But, alas, it seems that when push came to shove, Conde Nast was more comfortable selling pages in a glossy book than in driving online growth. While that may be a good short-term decision, I think it will hurt them in the long run.
The good news is that it appears that Felix will remain at Portfolio.com, at least for the near-term. And in his own analysis of the situation, Felix reiterates the arguments that I've long been making - that bloggers are an economical way to build traffic and a brand:
But if you are going to invest in your own editorial content, bloggers are often a very smart way to go. They're lean, since they need very little editing and often work from home. They build a reliable readership: in a world where loyal readers are defined as those who visit five times a month or more, blogs often get readers coming back more than once a day, especially if and when the comments streams get lively. And, yes, they're cheap, compared to any other original content. On a dollars-per-word or even on a dollars-per-pageview basis, it's hard for other forms of editorial content to compete with bloggers.
