What's this a picture of?
The IHT's 2008 Christmas party? No.
A group of market players who punted on NYT Company Stock dropping below $5 in 2008, celebrating last weekend after Friday 21st November saw that stock trade at a low of $4.95? No.
(No as in no, it's not a picture of investors celebrating that event but yes, as in yes, there were some parties last weekend for investors who made that call earlier this year. NTY Company stock really did drop below $5 and it's now trading - as of yesterday's market close - at $7.19.)
Actually, it's a picture of some luxury goods bloke's annual bash in 2007, and in 2008 it's these people's money that have formed the backbone of the IHT's advertising revenue - fashion, watches and other luxury goods from property to hotels.
However it would seem that not even the high end sector is immune from recession, as reported in yesterday's IHT. Not good news and I am sure JCD and SDJ must be in nigh-continuous meetings revising down, and down, and down, their 2009 advertising budgets.
I don't envy them. Even Denise Warren is on record as saying there is "absolutely nervousness in the marketplace", which is PR speak for "we're absolutely in a complete state of panic meltdown at the NYTMG and have no idea what to do."
P.S This is a NYT media article reporting the perils of the advertising marketing that does finally manage to talk at least about the NYT, even quoting Denise Warren, senior vice president and chief advertising officer at The New York Times Media Group. However, unless I've missed it, a broader story about the fate of the NYT Company remains to be written, as does one about News Corp. Perhaps there is a truce between the two companies - we won't write about what a perilous state you're in if you don't write the same about us. Sooner or later a big name blogger will, and the NYT will be left looking very silly.
As sales drop, luxury brands are cutting back
By Stephanie Clifford
Monday, November 24, 2008
NEW YORK: Gold was raining from above for luxury brands in the good old days of 2007.
Last December, the designer Marc Jacobs held his annual holiday party for 800 guests, including revelers from Vogue, W and Harper's Bazaar, in the Rainbow Room at Rockefeller Center in New York. Using the theme of Arabian Nights, Jacobs had arranged for tableaux vivants, contortionists, five open bars, bare-chested women bedecked in gold necklaces, bare-chested men balancing candelabras on their heads and, at one point, a shower of gold glitter poured over the guests.
Jacobs has held the party for each of the past 18 years, but on Nov. 4, a short e-mail message was sent out by his business partner, Robert Duffy: "Due to the financial climate, I had to make the decision to cancel the 2008 holiday party."
After getting through most of this year unscathed, luxury brands are suffering. Rich consumers who were relatively insulated from the economic downturn continued spending, but that has changed in the past few months. While luxury spending began to fall slightly after June, in October alone it dropped 20.1 percent, according to MasterCard SpendingPulse, which estimates consumer spending in the retail and service sectors.
Graff Diamonds, the London retailer, is among those cutting its budget. "We're definitely not taking on any new advertising, and we're cutting back on all our current advertising," a Graff spokeswoman said. She declined to specify a figure but said the cuts were lower in Britain than in the United States.
Brioni, the Italian fashion line, will cut its advertising by 10 percent to 15 percent in U.S. publications, said Antonella De Simone, the co-chief executive.
Other high-end projects - and the advertising that would accompany them - are being delayed or canceled. Orient-Express Hotels canceled new buildings in Miami; Cartagena, Spain; Zambia; and Puglia, Italy. The American developer Donald Trump is postponing a $300 million development in Philadelphia, and the Ritz-Carlton Hotel company has halted projects in Florida, Vancouver and California.
Some luxury brands continue - quietly - to spend on client dinners and hold parties, which they view as directly affecting sales. The events may not erase economic concerns, however.
In October, the Swiss watch brand Vacheron Constantin held a party to promote a new line of watches, some costing as much as $60,000. At the event, it seemed like pre-crisis times: Waiters passed trays of zucchini-wrapped lobster and beef en croûte and filled glasses with Moët & Chandon Champagne.
"As of today, I think it would be wrong to stop everything because of the crisis," Julien Tornare, president of Vacheron Constantin North America, said in an interview. "Of course we will adjust if we have to in the future, but right now we don't want to react."
But more than half of affluent consumers have cut their spending on luxury products from a year ago, according to a study by Unity Marketing, a market-research firm. Those consumers' confidence in the economy is at the lowest level in five years.
"The stereotype in our sector is the high-end luxury brands are Teflon to a recession, which, of course, is nonsense," said Alexander Duckworth, the founder of Point One Percent, a New York company that advises luxury brands on marketing. "Much more so than in a traditional recession, this has really hit quite hard at the top and quite quickly at the top. We're just seeing the very beginning of this."
Ronald Jackson, chief executive of Tradema of America, which markets and distributes Girard-Perregaux watches in the United States, said he was reducing his advertising budget in the United States by about 20 percent for the first quarter.
"We have retailers that are saying, 'You know what? We have this on order, but we need you to not ship it until things get better,"' Jackson said. "We have to react in some way."
The drop-off in luxury business means bad news for magazines and newspapers that have grown to depend increasingly on luxury advertising.
Advertising pages at the top U.S. luxury magazines fell 22 percent for December issues from a year earlier, according to Media Industry Newsletter. Vogue, for example, dropped to 221 pages this December, from 284 pages last December, while Food & Wine went to 126 pages from 160, the newsletter said.
That has meant cutbacks at publishers. In October, Condé Nast announced it would reduce Men's Vogue from 10 issues a year to 2, reduce the number of issues of Condé Nast Portfolio and cut magazine budgets by 5 percent.
Niche Media, which publishes Gotham and Hamptons, laid off some employees and closed another magazine. American Express Publishing, which owns Departures, Travel & Leisure and Food & Wine, is laying off 4 percent of its staff.
"It's definitely an environment that most have never seen," said Ed Ventimiglia, publisher of Departures. "Everyone is very concerned and somewhat confused as to what they should do."
High-end advertising was one of the few strong categories earlier in the year. Luxury ad spending in categories measured by Nielsen Monitor-Plus actually rose 6.7 percent through August over the previous year, even as almost all other areas cut their spending.
Publishers did not miss that trend. In September, Dow Jones introduced WSJ, a glossy magazine, to attract luxury advertisers, and The Washington Post introduced FW, a fashion magazine. The New York Times Co. has said its style magazines are big revenue sources, and magazine publishers like Hearst, Condé Nast and Niche Media have also bet that high-end consumption and advertisements would continue.
Facing a steeper decline, publishers are feeling very vulnerable.
"What the first salvo seems to be, going into 2009, is luxury advertisers - who will go unnamed - are trying to take advantage of the negative news in the market in order to secure a more favorable rate," said Jim Taylor, publisher of Town & Country, a Hearst magazine.
"It would be a reasonable argument if our costs weren't going up dramatically, but we're affected by the same things they're affected by," he said. "Paper's way up, postal's way up."
Taylor said he was expecting smaller brands, in particular, to reduce the number of ads they would run.
At Condé Nast Traveler, advertisers are being slow to commit, and financial services and real estate ads are plummeting, said the publisher, Lisa Hughes.
Michael Rooney, chief revenue officer of Dow Jones, the News Corp. division that publishes The Wall Street Journal and WSJ, said luxury advertising in the newspaper was about flat. There were 51 advertisers in the first issue of WSJ, he said, and 52 so far in the second issue, which comes out in December.
Luxury advertising in The New York Times has been "very stable" this year, said Denise Warren, senior vice president and chief advertising officer at The New York Times Media Group. She said the holiday issue of the fashion publication T Magazine was up by one page of advertising compared with last year. Still, she said, "there is absolutely nervousness in the marketplace."
And Ventimiglia of Departures said the January issue was down in ad pages. "A page here and a page there add up," Ventimiglia said, "even though many lost pages are a result of delayed budgets, and we're taking a hit."
By Stephanie Clifford
Monday, November 24, 2008
NEW YORK: Gold was raining from above for luxury brands in the good old days of 2007.
Last December, the designer Marc Jacobs held his annual holiday party for 800 guests, including revelers from Vogue, W and Harper's Bazaar, in the Rainbow Room at Rockefeller Center in New York. Using the theme of Arabian Nights, Jacobs had arranged for tableaux vivants, contortionists, five open bars, bare-chested women bedecked in gold necklaces, bare-chested men balancing candelabras on their heads and, at one point, a shower of gold glitter poured over the guests.
Jacobs has held the party for each of the past 18 years, but on Nov. 4, a short e-mail message was sent out by his business partner, Robert Duffy: "Due to the financial climate, I had to make the decision to cancel the 2008 holiday party."
After getting through most of this year unscathed, luxury brands are suffering. Rich consumers who were relatively insulated from the economic downturn continued spending, but that has changed in the past few months. While luxury spending began to fall slightly after June, in October alone it dropped 20.1 percent, according to MasterCard SpendingPulse, which estimates consumer spending in the retail and service sectors.
Graff Diamonds, the London retailer, is among those cutting its budget. "We're definitely not taking on any new advertising, and we're cutting back on all our current advertising," a Graff spokeswoman said. She declined to specify a figure but said the cuts were lower in Britain than in the United States.
Brioni, the Italian fashion line, will cut its advertising by 10 percent to 15 percent in U.S. publications, said Antonella De Simone, the co-chief executive.
Other high-end projects - and the advertising that would accompany them - are being delayed or canceled. Orient-Express Hotels canceled new buildings in Miami; Cartagena, Spain; Zambia; and Puglia, Italy. The American developer Donald Trump is postponing a $300 million development in Philadelphia, and the Ritz-Carlton Hotel company has halted projects in Florida, Vancouver and California.
Some luxury brands continue - quietly - to spend on client dinners and hold parties, which they view as directly affecting sales. The events may not erase economic concerns, however.
In October, the Swiss watch brand Vacheron Constantin held a party to promote a new line of watches, some costing as much as $60,000. At the event, it seemed like pre-crisis times: Waiters passed trays of zucchini-wrapped lobster and beef en croûte and filled glasses with Moët & Chandon Champagne.
"As of today, I think it would be wrong to stop everything because of the crisis," Julien Tornare, president of Vacheron Constantin North America, said in an interview. "Of course we will adjust if we have to in the future, but right now we don't want to react."
But more than half of affluent consumers have cut their spending on luxury products from a year ago, according to a study by Unity Marketing, a market-research firm. Those consumers' confidence in the economy is at the lowest level in five years.
"The stereotype in our sector is the high-end luxury brands are Teflon to a recession, which, of course, is nonsense," said Alexander Duckworth, the founder of Point One Percent, a New York company that advises luxury brands on marketing. "Much more so than in a traditional recession, this has really hit quite hard at the top and quite quickly at the top. We're just seeing the very beginning of this."
Ronald Jackson, chief executive of Tradema of America, which markets and distributes Girard-Perregaux watches in the United States, said he was reducing his advertising budget in the United States by about 20 percent for the first quarter.
"We have retailers that are saying, 'You know what? We have this on order, but we need you to not ship it until things get better,"' Jackson said. "We have to react in some way."
The drop-off in luxury business means bad news for magazines and newspapers that have grown to depend increasingly on luxury advertising.
Advertising pages at the top U.S. luxury magazines fell 22 percent for December issues from a year earlier, according to Media Industry Newsletter. Vogue, for example, dropped to 221 pages this December, from 284 pages last December, while Food & Wine went to 126 pages from 160, the newsletter said.
That has meant cutbacks at publishers. In October, Condé Nast announced it would reduce Men's Vogue from 10 issues a year to 2, reduce the number of issues of Condé Nast Portfolio and cut magazine budgets by 5 percent.
Niche Media, which publishes Gotham and Hamptons, laid off some employees and closed another magazine. American Express Publishing, which owns Departures, Travel & Leisure and Food & Wine, is laying off 4 percent of its staff.
"It's definitely an environment that most have never seen," said Ed Ventimiglia, publisher of Departures. "Everyone is very concerned and somewhat confused as to what they should do."
High-end advertising was one of the few strong categories earlier in the year. Luxury ad spending in categories measured by Nielsen Monitor-Plus actually rose 6.7 percent through August over the previous year, even as almost all other areas cut their spending.
Publishers did not miss that trend. In September, Dow Jones introduced WSJ, a glossy magazine, to attract luxury advertisers, and The Washington Post introduced FW, a fashion magazine. The New York Times Co. has said its style magazines are big revenue sources, and magazine publishers like Hearst, Condé Nast and Niche Media have also bet that high-end consumption and advertisements would continue.
Facing a steeper decline, publishers are feeling very vulnerable.
"What the first salvo seems to be, going into 2009, is luxury advertisers - who will go unnamed - are trying to take advantage of the negative news in the market in order to secure a more favorable rate," said Jim Taylor, publisher of Town & Country, a Hearst magazine.
"It would be a reasonable argument if our costs weren't going up dramatically, but we're affected by the same things they're affected by," he said. "Paper's way up, postal's way up."
Taylor said he was expecting smaller brands, in particular, to reduce the number of ads they would run.
At Condé Nast Traveler, advertisers are being slow to commit, and financial services and real estate ads are plummeting, said the publisher, Lisa Hughes.
Michael Rooney, chief revenue officer of Dow Jones, the News Corp. division that publishes The Wall Street Journal and WSJ, said luxury advertising in the newspaper was about flat. There were 51 advertisers in the first issue of WSJ, he said, and 52 so far in the second issue, which comes out in December.
Luxury advertising in The New York Times has been "very stable" this year, said Denise Warren, senior vice president and chief advertising officer at The New York Times Media Group. She said the holiday issue of the fashion publication T Magazine was up by one page of advertising compared with last year. Still, she said, "there is absolutely nervousness in the marketplace."
And Ventimiglia of Departures said the January issue was down in ad pages. "A page here and a page there add up," Ventimiglia said, "even though many lost pages are a result of delayed budgets, and we're taking a hit."
READ AN ALTERNATIVE IHT DAILY NARRATIVE AT
A PLACE IN THE AUVERGNE
LOOKING FOR A CHRISTMAS BOOK GIFT TO BUY?
"Books about cosmopolitan urbanites discovering the joys of country life are two a penny, but this one is worth a second glance. Walthew's vivid description of the moral stress induced by his job as a high-flying executive with the International Herald Tribune newspaper is worth the cover price alone…. Highly recommended." The Oxford Times
A PLACE IN THE AUVERGNE
LOOKING FOR A CHRISTMAS BOOK GIFT TO BUY?
"Books about cosmopolitan urbanites discovering the joys of country life are two a penny, but this one is worth a second glance. Walthew's vivid description of the moral stress induced by his job as a high-flying executive with the International Herald Tribune newspaper is worth the cover price alone…. Highly recommended." The Oxford Times
Amazon.co.uk
A PLACE IN MY COUNTRY
by
Ian Walthew
'I read A Place in My Country with absolute unalloyed delight. A glorious book.'
Jeremy Irons (actor)
‘Ian Walthew was a newspaper executive with a career that took him round the world, who one day did a mad thing. He saw a for-sale sign on a cottage in the Cotswolds, bought it, resigned and moved in. For the first few weeks he just lay on the grass in a daze. Then he started talking to his neighbours and digging into the rich history of this beautiful part of England. Out of his inquiries grew this affecting and inspiring memoir.What sets it apart from others of its ilk is the author’s enviable immunity to cliché and his determination to love his homeland better than he used to. His elegiac account of relearning how to be an Englishman should be required reading for anyone who claims to know or love this country.’ Financial Times
Amazon.com
A PLACE IN MY COUNTRY
By
Ian Walthew
For more reviews visit ianwalthew.com
Business trip to the IHT in Paris or friends and family coming to visit you? Fed up with hotels? Bring the family (sleeps 6) to superb Montmartre apartment - weekend nights free of charge if minimum of 3 work nights booked;. Cable TV; wifi, free phone calls in France (landlines); large DVD and book library; kids toys, books, travel cot and beds; two double bedrooms; all mod cons; half an hour to Neuilly and 12 mins walk from Eurostar. T&E valid invoices.
