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The Future of the Newsweekly From One With a Long History

Q&A: Time Magazine President-Worldwide Publisher Ed McCarrick

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NEW YORK (AdAge.com) -- "This is a new gambit on our part, OK?" Ed McCarrick told us a couple of years back. Mr. McCarrick, the president and worldwide publisher of Time magazine, was trying to get advertisers to focus on Time's overall audience, not just its paid print circulation.

Ed McCarrick
Ed McCarrick
Two years and one month later, as Mr. McCarrick prepares to leave Time on Dec. 31, the gambit has delivered more disappointment than results. His next act will be with Omnicom's barter unit Icon International as exec VP-director of account management and media-partnership programs.

In a sort of exit interview, we asked for his perspective on 35 years at Time Inc. Here are excerpts of our conversation.

MediaWorks: How did advertisers respond to your offer to sell against audience instead of just the old paid-circulation metric?

Mr. McCarrick: Obviously when we went to that proposition, we had a lot of conversations about where is the industry going, where is it headed, the need for more joint selling across dual mediums, i.e., print, digital, etc. How do you ultimately get to a place where you have one measurement form in terms of audience?

Really, when you go in and have conversations, 99.9% of the time, with an agency -- or even a client, for that matter -- you talk about audience primarily. I don't think that's changed.

What I can and will say is that we're probably disappointed that it didn't gain more traction with more advertisers in the marketplace and with more agencies. There was also the disappointment in terms of combining the reach and scope of Time.com and offline together.

I guess I walk away disappointed -- but not bowed so much that I don't think it's still an idea whose time will come. I think we were probably just premature and a little early on it.

MediaWorks: Did the shift to Friday delivery from Mondays produce any incremental ad sales or bring in any new clients?

Mr. McCarrick: It brought in new clients, but in this environment it's hard to measure whether it was successful or not.

First of all, we didn't do it from an advertising perspective; we did it from a consumer point of view, one that we knew from when I had come into the company in 1973 to where we were when we did this, going on three years now. We knew that people were taking their information in many ways shapes and forms.

With the advent of Time.com, we had permission to really change the business relationship with the client, first and foremost in terms of when we delivered the magazine to them. We wanted to put a new product in their hands at week's ends because that's when -- we found out -- they were reading it. In some instances they were getting news that was 10 days old.

MediaWorks: What about the 20% rate-base cut? Is Time now flying at its proper cruising altitude or are conditions calling for another adjustment?

Mr. McCarrick: I believe Time is flying at the right cruising altitude. We are very, very strong. We have one of the cleanest circulation statements. We charge 33% more than our nearest competitor. We feel very comfortable at the 3.2 million level. As I sit here and depart at year end looking out, I think we're enormously strong at that level.

MediaWorks: We talked in September, before your approaching departure was announced, about your expectation and hopes for 2009. "Times of adversity are the time to go out and herald the values of your brand," you said then. "When it turns, you will be in that much stronger position." So you see any marketers really stepping up and trying to improve their standing?

Mr. McCarrick: You see it in some of the advertising that's going on right now in the financial-services areas. Companies like Fidelity, Schwab, Bank of America are out there with some enormously strong messages in an industry and category that has been beleaguered. The trust values are at probably some of their lowest ebb right now. They are building a trust value with the consumer that I think is going to help them enormously once this market comes back.

It's the same in the auto industry. Certainly Toyota, Nissan and Hyundai are brands that I think are still out there in fairly aggressive fashions. GM, Ford and Chrysler actually have opportunities to go back out there if they can start to manage their businesses in different ways, which I think they're committed to, because they're making good products.

MediaWorks: You've been at Time since 1999. How does this recession compare with the downturn around 2001?

Mr. McCarrick: This is more difficult than any recessionary period I've seen in my 35 years here. I think it runs deeper. It runs across large categories of advertising. It runs across consumers in terms of what they're willing to spend for products.

We all have to be enormously competitive these days. And margins are literally being cut to the bone.

Ultimately, how do you define value? At the end of it, where will everybody wind up? Because you get to a place that eventually you can't cut any more, and you can't reduce costs any more without it cutting into the muscle and fiber of whatever it is.

Your commodity costs are going up. Your postal and delivery are going up -- your print costs, which are oil-based derivatives. Publishers especially are getting hit with double-digit increases in the physical part of their process. You have clients and agencies who are demanding lower and lower out-of-pocket costs.

At some point, where do you say, "Hey, this isn't worth it for me, to ultimately be doing my business this way"?

MediaWorks: Any guesses when the economy will start to show recovery?

Mr. McCarrick: If you'd talked to me in September, I probably would have said toward the fourth quarter of 2009. I think you're looking at the middle of 2010 now.

MediaWorks: What's the future for you, aside from your new role at Icon?

Mr. McCarrick: Well, you know my wife wants me to spend some more time with the family. My daughter's a freshman at Amherst. My son's a sophomore at Kent School. I want to see her play some lacrosse this spring, and I want to see him -- he's a crew guy. I sit on a couple of charitable boards: Concern Worldwide, which is about empowering women and children in Third World countries around the world, then I am on the First Tee of Connecticut Board, which is about promoting inner-city youth through the game of golf, urging and helping them to get through school. So I'm looking forward to doing that.

It's amazing. Once you retire, there's a whole bunch of people who raise their hands and say, "We want to talk to you about this, this and this."

MediaWorks: Anything else, as you look back?

Mr. McCarrick: Like I always say, I've had the great good fortune to work at Time Inc. and Time Warner for 35 years. Sometimes we can be a much-maligned company, because we're big and we're visible. Do we do everything right? The answer's probably no. But we still do a lot of things right.

I wouldn't have changed it for a second. The company's been very fair and very generous with me. I'll always bleed red for the Time brand as part of that entire process.

Our industry as a whole needs to take a step back and really think where it's headed. Regardless of whether it's Time, Newsweek or you're buying television, the cheapest common denominator isn't always the right thing to do and isn't always the right thing long-term for the efficacy of the brand.

Everybody's under a tremendous amount of pressure. I get it. But there's got to be some rationality brought back into the business. We've gotten into a place that's dangerous for everybody: the commoditization of everyone's business.

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