Condé Nast looks for new leader
NEW YORK: Condé Nast, the once-flush publisher of Vogue, Vanity Fair, The New Yorker and other magazines, is looking for a new business leader after years of losses.
The company said on Tuesday that its chief executive, Robert A. Sauerberg Jr, would step down after his successor was found.
The announcement came months after Sauerberg announced a sweeping plan to address the struggles at Condé Nast.
A corporate restructuring will go along with the change in leadership. The next person to fill the top job will hold the title of global chief executive, a new position at the head of both Condé Nast and Condé Nast International. The two entities have historically operated as separate sister companies.
Last year, Condé Nast lost more than $120 million. It has put three magazines, Brides, Golf Digest and W, up for sale, and it announced that it would end regular print publication of one of its oldest titles, Glamour.
In recent years, the magazine publisher has addressed declines in circulation and advertising by closing other magazines or reducing their frequency, laying off employees and leasing six floors of office space at its headquarters in One World Trade Center in lower Manhattan.
The troubles increased the pressure on Sauerberg. He was given a mandate to aggressively cut the company’s losses, but failed to meet that target, said two people with knowledge of internal business matters who were not authorized to discuss them publicly.
The publisher did brisk business in the beginning of 2018, particularly from digital video, but hit a stumbling block in the third quarter, when the print editions of its magazines fell short of goals, the people said.
Condé Nast’s September issues are especially important to the publisher’s financial health. This time around, the once-dependable international fashion and luxury houses did not fatten the glossies with enough advertising to stem the bleeding.
“The company is expecting financial losses for this year,’’ the people said.
Condé Nast was run for years by publishing mogul S.I. Newhouse, who died last year, and has long been the glittering jewel of the Newhouse family empire.
Its corporate parent, Advance Publications Inc, is a privately-held media company controlled by Newhouse’s brother, Donald Newhouse, 89, and Donald’s son, Steven O. Newhouse, 61.
As Sauerberg prepares to make his exit, Condé Nast International — also part of the Advance family — will take on new importance.
A note sent to employees Tuesday morning on behalf of the Condé Nast board said the company had been developing strategies to “meet the rapidly evolving media landscape,” acknowledging that the industry “is increasingly becoming more global.”
Based in London, Condé Nast International has had its own leadership team, with Jonathan Newhouse, 66, as the chief executive.
A cousin of S.I. Newhouse, Jonathan Newhouse “will leave his post once the global chief executive is hired, and will become the chairman of the board,’’ the company said.
While Condé Nast has struggled, its international counterpart, whose publications include British Vogue and Vanity Fair Italia, has thrived. One reason for its success is that print titles — on the wane in the United States — are still doing robust business in other parts of the world.
The president of Condé Nast International, Wolfgang Blau, 50, is a rising star at the company; he joined as chief digital officer in 2015 and rose to his current position in 2017.
The plan to combine the two publishing arms fits into the company’s larger aim to cut costs and unify its advertising and content strategies.
Having one lead account executive sell worldwide advertising for a single title could have certain advantages.
“Our brands have worldwide influence and impact, and our business is increasingly becoming more global,” Steven and Jonathan Newhouse said in the memo to employees.
“We have concluded that the time is right for us to combine our US and international companies to realize the full potential of Condé Nast for our audiences and our business partners.”
In what has proved to be a sign of things to come, Condé Nast said this year that it would merge the American and international versions of one of its magazines, Condé Nast Traveler.
And much of the photo production, backstage videos, social media posts and other digital coverage of Fashion Week for international editions of Vogue will be centralized in London.
Condé Nast International, which the company says is profitable, has also embarked on an ambitious expansion, creating new editions of Vogue in the Czech Republic, Slovakia, Greece and Hong Kong.
But combining the company’s worldwide ambitions will be difficult, and the Newhouse family is seeking someone with experience running international businesses to replace Sauerberg. That makes it less likely that it will elevate someone from inside the company.
Blau, the Condé Nast International president, tried to calm any speculation that he was a contender for the job in a post on Twitter.
“No, I will not move to New York and will not apply for the global CEO role,” he said. “I am happy with what I am doing here and thankful for the opportunity to support our global growth and the future global CEO from here in London.”
Sauerberg will leave the company after 13 years, less than three of them as chief executive. He will continue to represent Advance on the board of Reddit, the social media platform spun off by Condé Nast in 2011.