Beyond the Beaver State

Folio: The Magazine for Magazine Management, Feb 1, 1997 by Jeff Garigliano

After more than 15 years, Oregon Business Media, publisher of Oregon Business and Business@Home, has grown into the leading business and custom publishing company in Oregon.

The Portland-based company has been the biggest fish in a small pond for some time. OBM now includes two consumer monthlies, two Web sites, a collection of major custom-publishing contracts, 30 employees and annual revenues of more than $3 million. President, CEO and publisher David Rowe thinks the company is approaching the limits of what it can do in the Beaver State.

"We believe we're producing world-class magazines, and that our growth and return on investment are limited because of the trade area we're serving," Rowe says. "You've got to think outside the box. You've got to think outside of oregon." Now, he wants to take the company nationwide.

But reaching this point hasn't been easy. When Rowe joined the company five years ago, OBM's only title, Oregon Business, was losing money. With its circulation stuck at around 14,000, the magazine carried about 300 ad pages in 1991, and the company had overextended itself in custom publishing. "They were just all over the map," Rowe says. "The board [of directors] really had to make a decision -- should we sell [Oregon Business] or should we redouble our effort?" The company decided to reinvest, and Rowe was given a mandate to turn things around. He got rid of all but two custom contracts and focused his attention on the ailing monthly.

Focus on the flagship

Rowe toured the state, meeting with business leaders to get their opinions of Oregon Business, and began reworking the magazine's graphic design and editorial concept. A year later, Kathy Dimond, the current editor, signed on and made further changes, some of them extreme. "There was almost nothing that survived of the old Oregon Business other than the name," Dimond says. She brought in better writers and gave heavy attention to instituting annual branded features, like the Year's Biggest Deals, the 100 Best Places to Work and the Oregon Private 150 (a listing of the state's largest companies), all aimed at increasing the magazine's visibility. She also worked to make its photography more vivid and relevant: "The magazine had a tendency to run the photo of a man in a white dress shirt leaning on an inanimate object, usually a desk," she says. "We banned those photographs."

To fix the magazine's distribution problems, Rowe hired a circulation manager and moved the list from a local expert to a fulfillment house based in Los Angeles. He also made internal changes at OBM, upgrading the company's somewhat primitive facilities. In his first days at the company, Rowe went around the office and counted just three computers, all IBM clones. "Production was done via paste-up boards, tape and X-Acto knives," he says. He outfitted the office with Macs and contracted out the magazine's design and production until he could assemble a full-fledged in-house direct-to-plate operation.

The changes paid off. Within two years, Oregon Business turned a profit again. Ad pages for 1996 totaled 540 and the net income per page is up to $2,550, double its 1992 level. In 1995, the title won a Maggie award from the Western Publications Association for "Best Managerial and Professional Magazine."

The next project will be further improvements in circulation. "Circulation has been kind of a stepchild," says Russell Campbell, die company's CFO. "WE haven't really gone after it like we need to." Oregon Business is now BPA-audited at just under 20,000, and Campbell says the company's planned efforts -- direct mail and telemarketing -- will be focused on increasing the percentage of paid subscribers rather than raising total circulation. State business titles generally achieve about 10 percent paid, according to Rowe. Oregon Business is now at 25 percent, and the company hopes to raise that to over 50 percent. "We know people like the magazine," Dimond says. "We know they will pay for business information."

Home is where the business is

Oregon Business Media's other consumer title is Business@Home, which was bought from founder John Knowlton in January 1996 and renamed from its original title, Home Based Business News. The acquisition is part of Rowe's plan to grow OBM into a national company, given that the home-based employment market offers a readership far beyond Oregon state lines. Some 43 million people work at home, of which about 13.1 million are full-time, according to ICD/LINK, a Manhattan-based market research firm that tracks home employment. Like its sister publication, Business@Home was overhauled, this time by Dimond and Knowlton, who still serves as editor. "It was a newspaper format," Dimond says. "They depended on news in the front and columns in the back, and that was [Knowlton's] paradigm. We brought it into the magazine world."

Busines@Home is now stapled and trimmed, though still sized as a junior tabloid. "We didn't want to make it too slick, too quick," Rowe says. The latest change, in January, was to new paper-coated stock in place of newsprint. The title is currently distributed in Oregon and Washington State and, in June, will expand to other cities with a large concentration of home-based workers, including Austin, Texas; Kansas City, Missouri; and Pittsburgh. "What we're trying to do is maintain the specific Northwest distribution until we're ready to throw the switch," says Rowe. "The danger is to distribute ahead of the national advertising stream."