Now we know they’re serious at Conde Nast about cutting costs: they’re going to spend money to do it. The magazine publisher has been slicing away at expenses since the ad market started to tank, closing glossy biz mag Portfolio , demanding cuts of various percent. That wasn’t enough. (As one Conde Nast publisher told the NY Observer, “We half-assed the cuts last year.”) Instead, CEO Chuck Townsend told his staff Monday afternoon that it is time to “rethink” the entire business and he is bringing in consultants McKinsey and Company to help make it happen.
A Conde Nast spokeswoman told paidContent that McKinsey is beginning to work with the company this week “and we’ll see where it takes us.”
Townsend, who had to know the message would quickly spread beyond Conde Nast, sent out a terse memo (posted by the NYO and others) explaining his plans and the rationale behind them, warning that “we must realign Cond Nast to be a successful business in an emerging economy that is now predicted to be painfully slow in recovering.”
Working with McKinsey, Townsend and a Conde Nast team will “develop new perspectives on optimizing our approach to business, growing revenues, and enhancing our brand assets. All areas of Cond Nast will be included in the study.” Conde Naste has more than 30 brands between the consumer magazines, which include The New Yorker, Wired and Vanity Fair, and the Fairchild Fashion Group.
Bringing in outsiders is a time-honored way to shake things up. Resisting their advice or mucking it up is an equally time-honored tradition. Conde Nast can’t afford the latter.
By Staci D. Kramer