After E-Commerce Experiments, Hearst Looks More Seriously At Shopping

In addition to apps and tablets, Hearst Magazines President David Carey provided some general outlines of the company’s e-commerce strategy during his appearance at the Bloomberg Media Summit yesterday. Following last year’s pairings between Harper’s Bazaar and Net-a-Porter, a luxury fashion e-tailer, and Marie Claire and HauteLook, the company is fully embracing e-commerce as an alternative revenue stream.

As Carey noted in his appearance, while advertising has come back, it is more at “2008 levels” instead of the industry’s recent peak in 2007. For Hearst Magazines’, this year’s growth is trending in the “solid single digits,” he said.

That’s certainly not bad news, but it’s not great news. Certainly, magazines have learned that advertising in the digital age is much more fickle. Consumer spending, on the other hand, is a lot more reliable, especially if it’s targeted and involves nothing more than the tap of a touchscreen. Therefore, while most magazine publishers made some tentative e-commerce experiments last year, this year is expected to produce much more serious arrangements.

It will still take time to determine the right set of approaches, given the various brands Hearst has and its work on integrating iCrossing, the search marketer it bought last year, and the purchase of Hachette’s titles, including Elle, Woman’s Day, Car and Driver, and Road & Track.

“Because e-commerce comes in so many different flavors, there are so many structures to choose from, it’s more complicated than simply putting a price icon on a page,” said John Loughlin, Hearst Magazines’ EVP/GM, in a conversation a few weeks ago with paidContent. Loughlin also provided some insights into Hearst’s thinking about the app market for magazines during day two of the Media Summit.

As it seeks to balance its desire to have a wider array of e-commerce options with the need not to alienate its audiences and existing advertisers, Hearst has established an E-Commerce Council made up of all different brands from both the editorial and publishing sides. “We want figure out what works and what doesn’t,” Loughlin said. “There are different steps to building an e-commerce offering into print, such as with QR codes that can be scanned by a smartphone,

The Net-A-Porter deal with Harper’s Bazaar, which involved co-producing an edit page where readers could buy all the products on the page through the e-commerce company’s site, will be repeated again, Carey said.

Secondly, the company is looking for similar partnerships to the one it has with HauteLook. As for how well an initial partnership can perform, HauteLook worked with Marie Claire and several other Hearst brands on an e-mail-based deals program. Gross sales were approximately $2.2 million, with $500,000 of new revenue to the Hearst magazine brands that participated, Loughlin said.

“I think 2009, 2010 was a time for a lot of experimentation, but by that point, we were already deep into e-commerce selling $25-, $30 million in subscriptions every year,” Loughlin said. “So there was a realization that we were doing e-commerce and that it was a natural extension to sell other companies products. “It’s still a developing opportunity, but we’ll be more aggressive over the course of the year, with both repeated, ongoing programs and several new ones.”