BtoB

Mercor constructs new foundation with merger

By Published on .

Reprints Reprints

It's no secret that business media companies are striving to limit their dependence on cyclical advertising revenue by attempting to increase subscription fee-based products. Nowhere is this more apparent than in the construction industry, where even small players such as Mercor Media are angling for more constant revenue streams.

Last month, Mercor, a small Chicago-based publisher of construction industry magazines such as CE News and Structural Engineer, completed a merger with ZweigWhite, a construction industry consulting firm.

Prior to the deal, Mercor derived 80% of its revenue from advertising, according to Dick Ryan, who headed Mercor and is now the president-CEO of the combined entity, known as Zweig White Information Services. Ryan said that the new company generates about one-third of its revenue from advertising, one-third from consulting and one-third from exhibitions, conferences and other products.

"We're now selling more stuff to our readers than tour advertisers," said Ryan, who mentioned the McGraw-Hill Cos. as the inspiration for the move to merge Mercor and ZweigWhite. "That's the model," he said.

The McGraw-Hill model

McGraw-Hill Construction Network combines ad revenue products, such as Architectural Record and Engineering News-Record, with fee-based products such as Dodge, a database of construction projects, and Sweets, a database of construction products.

Using McGraw-Hill as the umbrella brand, Norbert Young, president of McGraw-Hill Construction, has taken strides to link the properties both in the minds of those in the commercial construction industry who use and read these products and in the minds of the industry's suppliers. All the unit's Web sites are accessible via construction.com, which provides a nexus for marketers-through sponsorships or banner ads-to reach their constituency.

Reed Business Information U.S. has assembled a variety of products serving the construction industry. The business media company has long had ad-based publications such as Construction Equipment, but in 2000 it acquired CMD Group, which is now known as Reed Construction Data. The hub Web site of Reed Construction Data serves as a portal to construction project data and also allows visitors to access Reed Business' construction industry magazines.

Hanley Wood, which focuses on residential construction, has adopted the same model of stretching well beyond ad revenue products such as its flagship magazine, Builder. In addition to its magazine division, the company has exhibitions, marketing services, electronic media and data. Hanley Wood acquired the Meyers Group earlier this year to add one more revenue stream: research on the industry.

Companies such as Hanley Wood, Reed Business, McGraw-Hill and now Mercor wouldn't strive to reduce their reliance on ad pages without good reason. And that is that marketers want more than an ad page these days. Companies such as buildings material supplier Johns Manville practice sophisticated integrated marketing techniques. "They've put together a pretty comprehensive package to be honest with you. It's IMC: integrated marketing communications," said Tony Fonk, Johns Manville's commercial and residential business manager, of McGraw-Hill.

In this article:
Most Popular