It's back from the brink, financially speaking. It's now in the hands of two venture-capital guys, who say they will spend $80 million to relaunch the fabled adult brand. They also say that its recent run of hardcore content is over, in favor of a smarter take on men's magazine mores. (Minus the clothing, of course.)
"It's going to be something you're going to want to buy, and not be embarrassed about having on your coffee table," says Marc Bell, co-CEO and director of Penthouse Media Group and managing director of the Florida-based Marc Bell Capital Partners. He and Co-CEO Dan Staton have shared combined editor in chief and publisher titles since the February '05 issue. A full-fledged relaunch comes this fall.
"This is one of the world's greatest trademarks," Bell says. "Talk to any man between 18 and 99, and they know exactly what Penthouse means. ... We are going to rebuild it and return it to the grandeur it once had."
That will take some doing. The long, slow dissolution and bankruptcy of founder Robert Guccione Sr.'s empire has been well documented.
Meanwhile, the peculiar mainstreaming of pornography in American culture has, perversely, worked against it, in ways both obvious and counter-intuitive. Porn is available, in every possible stripe and at every possible moment, on the Web and cable TV. And there's also increasing squeamishness for marketers about advertising alongside graphic content, as the Web and e-mail make it easier for pressure groups to mount letter-writing campaigns. At its peak during the 1970s, Penthouse sold 5 million copies a month. At the end of 1996, its circulation was still over 1 million. For the last half of 2004, it was just 382,019, down more than 20% from the year previous. In 2003, it missed at least one issue and staffers were quoted in the press as saying they were only getting 25% of their paychecks.
"They have cleaned up their act, and it's definitely more palatable," says Mia Mariano, VP-group director of print at Grey Global Group's MediaCom, which buys for spirits giant Diageo. But, she noted "then you get to the back of the book, and you see the hardcore fractional ads." Even aside from that, Mariano says, players such as Penthouse must contend with liquor dollars moving to cable and a general trend away from the likes of Playboy and Maxim.
A media buyer working with a classic luxury boy-toy marketer put it even more bluntly, saying "they could really soften it up, and I'm still not going to be there."
None of this fazes Bell. Liquor, tobacco and men's products "are a natural fit," he says. "Now that the content is very soft, I don't think they will have a hard time getting over the hump."
"We are investing over a million a month," says Bell, and shooting for pumping circulation back up to a million by year-end. He outlines a multimedia strategy that reads like a Martha Stewart Omnimedia conception of porn, in which men read "the magazine to see [its centerfold Pet] in print, see her on the Web site, on a TV channel in a movie, chat with her on the Web site" and meet her in person at a Penthouse club.
Playboy remains an entity wreathed around the persona of founder Hugh Hefner, but Penthouse's latest iteration will come without its own founder, Bob Guccione. (Guccione could not be reached for comment.) Bell downplayed the importance of a brand embodier. "I'll say this very delicately, and I mean it respectfully," says Staton, but "people aren't that into a septuagenarian in his bathrobe."
With the heyday of Penthouse nearly 30 years in the past, can it come back?
"They are looking at a tough slog," says Robert Passikoff, founder and president of brand consultancy Brand Keys. And, he points out, male consumers "are not out there looking for a toned-down skin magazine."