The Great Media Shakeup

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This week, the front row chatter at the New York shows was dominated not by the clothes, but by a series of surprise departures at the heart of the Manhattan media establishment.

On Thursday, September 7, Vanity Fair's Graydon Carter, one of the few lavishly paid, larger-than-life editors left in a sector hit by shrinking advertising spend, announced his departure after 25 years at the magazine. On Monday, September 11, Roberta "Robbie" Myers, editor-in-chief of the American edition of Elle, announced her own exit in a memo to staff after 17 years at the title. Then, this Thursday, Cindi Leive, editor-in-chief of Glamour, quit her job, making her the third editor of a major American fashion magazine to step down in the span of a week, laying the ground for an unprecedented changing of the guard. Stella Bugbee, president and editor-in-chief of The Cut, went so far as to tweet: "I wonder, quite seriously, as the great editors leave, if that means the end of their print publications?"

Certainly, the departures come amid a major shift in media consumption habits. The average American now spends more time on digital media and technology than work or sleep, according to Michael J. Wolf, founder and chief executive of technology and strategy consulting firm Activate. What’s more, data presented by Mary Meeker, general partner at venture capital firm Kleiner Perkins Caufield & Byers, reveals that Americans spend only 4 percent of their media consumption hours with print, compared to 20 percent on personal computers and 28 percent on mobile. And yet, even as circulation figures stagnate and newsstand sales plummet, print advertising still generates the majority of revenue for many large publishers.

That’s because the budgets currently being allocated to print advertising are still out of sync with how consumers actually spend their time. But the luxury brands whose ads fill upmarket fashion and lifestyle magazines — many of which have been slow to recalibrate their marketing strategies — are now taking note. What’s more, in the age of Instagram, when brands can create their own content and reach consumers directly, legacy media is being disintermediated. Make no mistake, a sea change is coming that could shake the media world in Manhattan and around the world to its very core.

Carter is set to remain at Vanity Fair until December and his successor remains unknown. According to sources, Adam Moss, editor of New York magazine, has long been the favourite choice, even if he isn't interested in the job. Joanna Coles, chief content officer of Hearst Magazines, is also thought to have put her name in the ring. Interestingly, Jon Stewart — the comedian, writer and producer best known for having been the host of the satirical television news programme "The Daily Show" — was tipped by some as an outside possibility. But one thing's for sure: Nina Garcia, currently the creative director of Marie Claire, is set to succeed Myers at Elle on September 18. So what does Garcia's appointment say about the state of the media industry and how magazines are hoping to reverse their fortunes?

Whereas Myers saw fashion as a pillar of popular culture and was deeply interested in covering areas like politics, Garcia is better known for her close relationships with fashion and luxury advertisers. Importantly, she has also attracted attention for her telegenic personality, which she has parlayed into a role on "Project Runway" and a significant social media following. Both are critical for legacy media titles aiming to boost their revenues by becoming multi-platform brands more in tune with the evolving channel habits of consumers and placing more emphasis on native advertising.

“Nina embodies all the qualities of a modern editor-in-chief. She’s an important authority in fashion, respected by her peers for her personal style, her ability to spot talent and her deep relationships across the industry,” said Hearst Magazines president David Carey. “She’s also known to millions around the world for her role on 'Project Runway' and the dynamic, behind-the-scenes life she shares with 4.5 million engaged followers on social media. Her love of fashion is deeply felt and it will resonate on every page.”

But at the shows this week, there was a clear sense that the departures of Carter, Myers, Gibbs and Leive were just the tip of the iceberg. Glenda Bailey, longtime editor-in-chief of Harper's Bazaar, is also said to be plotting her next move, transitioning to a corporate job within Hearst or retiring altogether. There's also the biggest fish of them all: Anna Wintour, editor of American Vogue and the de facto "president" of the fashion business, who sits atop the entire industry power structure but must be pondering her own next steps. Eva Chen, Sally Singer, Katie Grand, Kate Young, Lucy Yeomans, Stella Bugbee and Kristina O'Neill are amongst the names being bandied about by insiders speculating on who could succeed Wintour at what is still the world's most important fashion magazine.

There’s no doubt that magazines like Vogue (and Vanity Fair and Elle) have strong brands that still carry significant meaning in the marketplace. But is a change of editorship at this stage in the game really enough to turn things around as consumers continue to spend more and more time with what Wolfe calls “digital attention unicorns” like Google, Facebook and Apple, which each capture one billion or more minutes of digital attention per week.

There’s also upstart media players like Vice, BuzzFeed, Vox and Refinery29 with which to contend. And as Harvard Business School professor Clayton Christensen outlined in his seminal book “The Innovator’s Dilemma”, it’s very rare for a dominant player to maintain its market position in the face of a major technology disruption, and much more likely that new, more nimble players who are native to the new space simply come along and eat their lunch. Indeed, some of the names being discussed as potential editors at Vanity Fair and Vogue are thought to be uninterested in the jobs due to the weight of the legacy operations — and associated political baggage — they would inherit.

Certainly, to make it work, new editors must be accompanied by underlying strategic shifts like those put in place at Hearst Magazine's digital division, such as the creation of multi-brand groups, a unified content and data sharing platform, and a new emphasis on distributed media and native advertising. But even Hearst hasn't figured out how to make digital as lucrative as print once was, and the company is going to have to be willing to lose money for a while — much like many of the start-ups in the space — in order to get it right.

THE NEWS IN BRIEF

BUSINESS AND THE ECONOMY

Hermès first-half profits hit record levels. The French luxury house announced record operating margins of 34.4 percent of sales. A strong performance in leather goods, which accounts for 50 percent of overall sales, saw revenue rise by 13 percent to €931 million (£837 million) in the first half. Chief executive Axel Dumas warned second-half results may slow, but said it was keeping an "ambitious" medium-term goal for revenue growth despite growing economic and geopolitical uncertainties.

Nordstrom shares surge on reports that it may go private. Reports on Tuesday that private equity firm Leonard Green & Partners may help fund a buyout sent the American department store group's shares up as much as 12 percent. The Nordstrom family first said it was considering a deal in June, in a bid to continue its turnaround plan outside of the glare of public markets. The report comes a day after Nordstrom's latest "merchandise-free" store concept received a chilly reception from investors and prompted shares to drop as much as 5.4 percent on Monday.

Qatar sells Tiffany shares. The country's sovereign wealth fund has sold off $417 million in shares as its stand-off with neighbouring countries exceeds 100 days. The Qatar Investment Authority will retain a 9.5 percent stake in the US jeweller, as part of a $40 billion bid to support Qatar's economic and financial system after Saudi Arabia, the United Arab Emirates, Bahrain and Egypt severed diplomatic and transport links with the country in June.

Amazon is reportedly planning an expansion in Mexico. The e-commerce giant is planning a one million square-foot warehouse near Mexico City to boost its presence in the country, according to reports. Amazon posted $253 million in sales in Mexico last year. The warehouse would join two existing distribution centres, contributing over 3,000 jobs. While Mexicans are wary of e-commerce, which comprises only 3 percent of all retail sales in the country, Amazon is competing for foreign markets with Alibaba Group.

Richemont sales beat expectations. Sales in the five months from April to August jumped 12 percent at constant currency, while Asia Pacific experienced a strong recovery, with 23 percent sales growth attributed to stock buybacks in its watch business. But the group gave no indication on a successor to Georges Kern, the former head of its watchmaking division touted as a potential chief executive, amid a leadership crisis that concerns shareholders.

PEOPLE

Dapper Dan in Gucci's Autumn/Winter 2017 menswear tailoring campaign | Source: Courtesy

Dapper Dan collaborates with Gucci. The Italian house — who has tapped the Harlem couturier for its Autumn/Winter 2017 menswear campaign — is sponsoring the opening of a new Dapper Dan studio and atelier, and will supply the designer with raw materials, according to The New York Times. Additionally, Dapper Dan will collaborate with the brand on a capsule collection due out next spring. The news comes after the luxury label faced fierce criticism for copying a Dapper Dan style for its latest Cruise collection.

Nina Garcia is to succeed Robbie Myers at Elle. Hearst Magazines announced Tuesday that Robbie Myers, editor-in-chief of Elle's American edition since 2000, would be stepping down. Nina Garcia, currently creative director at Marie Claire, will succeed her on September 18. The news follows a string of changes at the magazine this year: fashion news editor Anne Slowey stepped down in January after 18 years at the title; accessories director Maria Duenas Jacobs departed in June, and The Cut's Véronique Hyland joined as director of fashion features.

Glamour editor-in-chief Cindi Leive to exit. After 16 years leading the women's title at Condé Nast, Leive is resigning from her role. She will stay on until the end of the year, just like Vanity Fair's Graydon Carter, who announced his resignation last week after 22 years leading that title. Leive has not confirmed her next move, but told the New York Times: "I'm not going to another big media job or to a similar position at another company."

Teddy Quinlivan comes out as transgender. The 23-year-old model, who has walked for brands including Marc Jacobs, Dior and Valentino, told CNN Style that the current political climate was the reason she decided tell her story: "We made an amazing progression under the Obama administration, and since the new administration took office there's been a kind of backlash." Quinlivan hopes she can help change attitudes within the fashion industry and society at large: "The transgender community needs more visibility, and with more visibility will come more acceptance."

TECHNOLOGY

Apple launches iPhone X and 8 models. At its annual September Keynote event the company announced two new iPhone models. The iPhone X, starting at $999, is Apple's first premium-tier phone, with infrared facial recognition and an edge-to-edge OLED display eliminating the home button. The iPhone 8 and 8 Plus models include a glass body and faster chip, while the new Apple Watch Series 3 has cellular capabilities. The company's shares increased by 39 percent year to date through Tuesday.

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