A b-to-b publishing paradigm

Folio: The Magazine for Magazine Management, May, 1999 by Paul McDougall

That concept also applied with the acquisition a year ago of Young Conway Publications, which published Foodservice Product News and other titles.

Similarly, Bill's $14 million buyout of Progressive Grocer Associates (which published Progressive Grocer and Frozen Food Age) in September 1998 allowed it to come at the food market from the grocery side as well as the service side. Says Wickersham: "It made us the only publisher in the United States with food service and grocery titles under one roof. That allows us to play on both sides of the market for our advertisers' benefit. And it helps us provide our readers with better coverage of some key areas, such as take-out, that occurs in food service but also increasingly in the grocery area."

Hobbs says the strategy reflects VNU's desire to become the dominant player in several, well-chosen markets, rather than a marginal holder of disparate portfolios. "We have an interest not in owning tons of properties," he says.

Information, please

The other key component to Bill's growth formula is information products. By assembling a portfolio of market data services in areas that mirror the magazines and trade shows, the company is able to offer customers a vast range of media and data products that extend well beyond the simple four-color ad page.

Indeed, while its October 1998 acquisition of Atlanta-based Shore-Varrone Inc. gave Bill a number of strong retail titles, including Point Of Purchase, Sporting Goods Dealer and Display and Design Ideas, it also included a unique point-of-sale information business dubbed Sports Trend Info. An Internet-based subscription service, the unit will allow Bill to offer in-depth market data--such as lists of top selling athletic brands--to many of the same companies that advertise in Sports Trend magazine and buy booth space at Bill's retail shows. "This is crucial data if you are a sporting goods retailer," says Wickersham. "So if you're in that market, you're going to want to do business with us at some level."

Beyond offering Sports Trend data as a service to advertisers, Bill editors can sample it to create proprietary editorial products--from charts and sections all the way to special issues. "As a publishing company, we'd like to provide some level of data access by way of editorial," Wickersham says. "And by publicizing that Sports Trend data exists, there can be a mutually beneficial relationship between the editorial side and the information unit."

It's a type of product mix that VNU USA wants to replicate throughout its holdings, and it is precisely how the company plans to create a level of value within its new products that is sufficient to justify the prices it is paying for them. Says Hobbs: "These arrangements put us very deep in a given market. So we have many contacts, the markets see us as knowledgeable providers of data and information. Our expertise becomes very evident."

That strategy was again in evidence when VNU USA last year acquired a 49 percent stake in Shelton, Connecticut-based RMS Inc., with plans to buy the remaining 51 percent by 2003. RMS creates loyalty-marketing software for grocery retailers, and hence will allow VNU to bring another asset to bear on that market, in addition to its trade titles.