Not BusinessWeek as usual
Assuming a buyer materializes, an extreme makeover will be required to steer BusinessWeek toward profitability at a time when diminishing readership, slumping revenues and shrinking relevance are perhaps more severe for newsweeklies than they are for newspapers.
One way to pump new life into BusinessWeek may be to augment, or perhaps altogether supplant, its conventional publishing model by turning the franchise into a comprehensive and authoritative destination for independently produced business, economic and securities analysis.
This admittedly radical strategy suggests a number of new and badly needed revenue ideas, as discussed in a moment. But radical ideas appear to be in order for the battered newsweekly business.
In a world where news changes literally at the speed of light – and an abundance of information is free for the taking – the idea is quaint indeed that a magazine would come out once a week to tell us what happened in the prior seven days.
As forward-looking as BusinessWeek and the other newsweeklies profess to be, the genre remains rather hopelessly anachronistic in the minds of most consumers and advertisers.
BusinessWeek faces the same problems as the general-interest newsweeklies, which in recent years have pared their rate bases, cut their staffs and repeatedly redesigned themselves in desperate efforts to reinvigorate their brands. Their actions might have bought a bit more time but certainly produced no game-changing turnarounds.
BusinessWeek might have been expected to fare better than the general-interest books, because it reached a highly desirable audience of business-oriented readers who presumably out-earned and outspent the average person paging through Time or Newsweek at the dentist’s office.
For a while, indeed, BusinessWeek seemed immune. When the global economy plunged into the blackest hole since World War II, however, business and financial advertising were sucked right in. By all appearances, the category will continue to suck for some time to come.
The New York Post reports that BusinessWeek, which ran profits as high as $100 million a year during the Internet boom, lost more than $45 million last year and may lose up to $75 million in 2009.
The buyer who plunks down a buck for BusinessWeek will have to be prepared to creatively deconstruct the advertiser-supported business model that has been the mainstay of most print publications for as long as any of us can remember.
Hence, the radical idea of turning BusinessWeek into the definitive portal for crowd-sourced business news.
The initiative would generate a wealth of original and sophisticated content at zero cost to BusinessWeek, while producing fresh revenues at the same time.
Although crowdsourcing admittedly hasn’t proven to be a particularly reliable replacement for the coverage provided by the professional press, plenty of highly competent business analysts, academics and other qualified parties are itching to tell the world what they think.
This is particularly true at a time when thousands of un- and under-employed professionals would leap at the chance to gain the visibility a publication like BusinessWeek can provide.
BusinessWeek could capitalize on this opportunity by tasking its editors to identify and recruit ongoing contributions from the best authors of market research, economic analysis, investment ideas and other business insights.
The invited contributions would be featured on the BusinessWeek website and the best of them would graduate to the print product, assuming the economics are sufficient to support one.
In addition to traditional advertising and print subscription sales, the BusinessWeek portal could make money in the following ways:
:: After providing readers with free abstracts of premium articles, research, newsletters and blogs, the site could sell access to the full product and split the proceeds with the authors.
As but one example, BusinessWeek might offer subscriptions through its portal to Grant’s Interest Rate Observer, which costs $850 per year or $65 per individual issue. Although author James Grant, an old Barron’s hand, is well known in certain circles, he might be pleased to offer his wares to a larger audience than he can command on his own.
:: BusinessWeek could sell copies of individual research reports via call-to-action buttons embedded in web articles , as well as tear-out postcards stitched into the print product.
To get a sense of the potential market for lead-generation advertising, take a look here at the dozens of reports – a few ranging to $199 and beyond – available for Wal-Mart. Morningstar sells a portfolio management tool for $178 a year. Masters-O-Equity offers an options trading system for $599. And so it goes.
:: Depending on consumer demand, niche web, print and video products could be created on topics ranging from retirement planning to how to start a business. Revenues would come from subscriptions, advertising and lead-generation advertising. That essentially is what U.S. News and World Report has done with its college and auto-buying guides.
:: Conferences and other live events, as discussed previously here, could be another important revenue source.
Where does this leave the high-priced professionally produced journalism we know and love? That will depend on how well the magazine is able to capitalize on the various new revenue streams.
But one thing seems sure: BusinessWeek won’t be capable of producing any journalism if it continues losing tens of millions of dollars a year.
Even at a cost of $1 for the whole shebang, the magazine will be no bargain without a realistic path to profitability.