NEW YORK (AdAge.com) -- Conde Nast's digital arm is treading firmly on guarded agency turf by offering creative services to advertisers -- even for ads that don't run in Conde Nast properties, Advertising Age has learned.
The glossy publisher's in-house creative services group known as CND Studios is now accepting client assignments to craft ad campaigns regardless of placement. It is a significant shift for the company, which in the past has only done creative work for advertisers buying space on one of its publications, whether in print or online.
Conde's first client in this new venture, which only got under way in the last few weeks, is Kenneth Cole. The publisher created an online video series for the fashion brand that launched March 1 on the company's website, as well as on Facebook and YouTube. The campaign will continue to roll out new content on those sites through June.
"It was really a seamless project," said Robert Genovese, VP-marketing and media at Kenneth Cole Productions. "Based on this experience, we would definitely incorporate them into considerations for future projects."
Though such a deal represents a departure from Conde culture, it fits in with CEO Charles H. Townsend's digital ambitions, which has been at least a year long in the making. He re-formed the publishing titan's original online unit, CondeNet, into Conde Nast Digital over a year ago in an effort to consolidate the digital sales teams and bring in more revenue. "To get back to double-digit growth, we have to put our digital assets to work hard," Mr. Townsend told Advertising Age at the time. "I am hoping that the print business will recover to double-digit growth, but I am convinced that the digital business will grow exponentially."
To some, that kind of growth may be seen as a given outcome considering the fact that before the inception of Conde Nast Digital, online sales accounted for only 3% of the company's overall revenue. (There are no current revenue figures available.) But this latest move is a sign that the company is looking at every digital opportunity. In this case, they are seeking to gain from the fact that partnerships within the industry are continually changing, with new online agencies and shops forming almost weekly.
"In the digital world, there are these terms, 'co-opetition,' or 'frenemy,' so you're very used to working in a more transparent way," explained Drew Schutte, who was installed as chief revenue officer of Conde's new online group last year. "You're working with people who on another day might be your competition. So the way we saw it, it was an opportunity."
According to Mr. Schutte, who was previously the publisher for Wired and The New Yorker, the opportunity initially arose out of the group's many existing relationships. "We do a lot of creative services for our clients," he explained. "Last year we were doing over 30 custom programs per quarter, and now we're doing 50, and often people were asking us, 'I have this other thing I need you to do.' And we had to pass on it. So we thought, 'Why are we turning them away?'"
Though such an arrangement might result in a Conde-produced campaign running on a competitor website, Mr. Schutte said he wasn't concerned. "On our sales side we have done a ton to convince them why our programs will benefit them the most," he said, referring to their strategy that client work will seed potential future ad buys on a Conde web property. He further pointed out that some campaigns will inevitably be for a microsite or will only appear on the client's own website.
Aside from this evident upside, it further cements the company's reputation among marketers. "Conde Nast knows quality," Mr. Schutte said. "We know how to do things right and we understand their brands."
According to a Conde spokesperson, this group will only be executing online advertising vehicles and will not be advising on media buys. The in-house group that handles print campaigns remains separate from this endeavor.
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