NEW YORK (AdAge.com) -- Condé Nast is inching closer to slashing costs at its magazines, as editors and publishers begin preparing their 2010 budgets following meetings with Chief Operating Officer John Bellando.
The actual cost-cutting could begin as early as mid to late October at some titles, according to several people with knowledge of the situation. The meetings with Mr. Bellando, which began last week and are continuing through this week, are aimed at reducing budgets at each of the company's titles by an average of 25%, sources say.
The editors and publishers, who will be in charge of cutting from their respective departments, will have two to three weeks to submit their budgets for approval. Staff and spending cuts could soon follow.
"There is no uniform D-Day," said one executive. "Some [titles] are going to find it absolutely necessary to cut this year, some next year."
Titles that have been hit particularly hard by the recession include Gourmet, whose ad pages have fallen 43% through October, according to Media Industry Newsletter; fashion bible W, which is down 46%, and men's fashion magazine Details, which is down 36%.
Condé Nast has been undergoing a review of its operations since July by consulting giant McKinsey & Co., with an eye toward bringing spending in line with revenue. Insiders say that the division of privately held Advance Publications, Inc., has been losing money as the recession has pounded the luxury advertising category that had kept the publisher afloat through previous downturns.
Insiders also say that the company has never exactly been run as a lean and mean operation. They expect the kinds of cuts to differ according to the title. Some might focus on reducing headcount, while others might not have to.
Morale has also taken a hit as staffers wait to learn about their fates.
"It's like, instead of ripping off the band-aid all at once and getting it over with, they're ripping it off very slowly," said an insider.
A Condé Nast spokeswoman declined to comment on when the spending cuts could take place.
"The process continues and people are working on it and we'll see what's the best way to move forward," she said.~ ~ ~
Matthew Flamm is a senior reporter for Crain's New York Business.