Andrew Goodenough, president-CEO of the publishing group at Thomson Financial’s banking, financial and insurance unit, is working on the most heart-wrenching subscriber analysis ever. He’s trying to determine exactly who among his print subscribers didn’t make it out of the World Trade Center following the Sept. 11 terrorist attack on the twin towers.
"A number of our subscribers are still missing," Goodenough said, "and we want to make sure we’re not sending any products to anyone who is missing." Many of the missing were subscribers to Thomson’s flagship American Banker.
Thomson Financial, which has been on the sales block for the last several months, was perhaps the hardest hit among b-to-b publishers. Ten of parent company Thomson Corp.’s employees who worked at the World Trade Center are unaccounted for and another was a passenger on one of the jets that slammed into the towers. Thomson’s New York office, located near the World Trade Center, is still not fully operational.
Despite the emotional and physical toll, there’s been no "wholesale disruption in the business," Goodenough said. "The concern is for the individuals we’ve lost."
Thomson Financial has been busy placing"notice advertisements" at reduced rates for companies dislocated by the attacks.
Close to the edge
Trade publishers were already reeling from one of the worst business climates in decades before the attacks, and now they’re facing what’s expected to be an even more difficult period.
"The immediate impact will be very rough," said Gordon Hughes, president of the trade group American Business Media. "The industry was already in a recession, and this will make it only worse."
However, Hughes predicted a rebound will come quicker than anticipated, as b-to-b publishing companies undertake advertising campaigns in the next few months designed to boost business confidence.
"Sustained campaigns among b-to-b publishing companies will be part of bringing back the American spirit," Hughes said. "Then we can get back to business as usual."
Hughes said one result of the tragedy will be a significant slowdown in b-to-b publishing mergers and acquisitions until banks can get a better handle on what lies ahead. "It’s not as if the deals aren’t out there, there just won’t be any money," he said.
Wilma Jordan, president-CEO of media investment banking firm Jordan Edmiston Group Inc., disagreed with Hughes’ assessment. "We expect to see a slow, steady continuation of media M&As," Jordan said, adding that the company is on the cusp of closing two media deals with a combined value of about $45 million. "You’re not going to see double-digit multiples, but the banks say the money is there."
Another challenge facing b-to-b publishers is the possibility of further postal rate hikes. The day before the terrorist attacks, Postmaster General John Potter proposed a 10% periodical-class rate hike, effective next July. That would be on top of the 9.9% rate hike in January of this year and an additional 2.8% increase that took effect in July.
The ABM is huddling with the Magazine Publishers of America and Newspaper Association of America on a lobbying strategy to fend off another rate hike.
Back to business
Many top business media companies say they’re now primarily concerned with getting back into a routine following last month’s attacks.
"There’s so much uncertainty on how the attacks will affect our industry," said Tom Kemp, chairman-CEO of Penton Media Inc. "So far, it hasn’t had a big effect on advertising. What we need to do is focus on the basic fundamentals."
Gary Marshall, president-CEO of CMP Media L.L.C., said: "It’s so dark right now it’s difficult to tell one way or the other" what the impact of the attacks will be. "Right now our primary concern is dealing with the human side of the tragedy." Although there were no CMP employees killed in the attacks, many workers knew people who are listed as missing and presumed dead.
Marshall said there hasn’t been a significant drop off in advertising since the attack, and circulation is holding steady, too. "We’re already operating in difficult markets," he said. "For now, we have to get back to work, stick to the basics and continue to work with our customer base."
Tim Yocum, sales manager for Chemical Week Associates, which publishes Chemical Week, among several other titles, and whose New York office is near the World Trade Center site, said subscribers may get their issues "a day or two late, but circulation and advertising are still on schedule.