Maxim Turns Profit, But Revenue Still Stumbling
NY Post: Maxim "turned a profit in 2018, its first since Sardar Biglari took over in 2014.But the mag has not turned the corner for good, unfortunately, as numbers filed with the Securities and Exchange Commission earlier this month show revenue is stumbling even as it continues to broaden beyond its print roots. That’ s likely to increase pressure to run another controversial pay-to-play cover-model contest in the second half of the year that gives a slice of the contest money to Jared Allen’s Homes for Wounded Warriors — but generates even more money for the Maxim coffers. The income from the contest in the fourth quarter enabled it to climb to profitability. In his year-end note to shareholders, Biglari said that “in 2018, Maxim earned $1.1M, its first seven-figure profit in over a decade.” Unfortunately, in Q1 2019, Maxim lost $112,000, according to the filing, which was less than in the 2018 first quarter, when it lost $217,000. Revenue tumbled to $877,000 in Q1, company filings showed, down nearly 50% from the $1.744M in revenue in the year-ago quarter. Calls to Maxim and Biglari were not returned."
AMI Investor May Join Group Backing Cohen's Enquirer Deal
NY Post: "Leon Cooperman, the investor who heads Omega Advisors and owns about 10% of American Media Inc., may join the investment team that is backing Hudson News CEO Jimmy Cohen’s $100M deal to buy the National Enquirer and two other tabloids. Cooperman “is looking at the numbers,” according to a source close to the situation. American Media Inc. CEO David Pecker could also be part of the investing group, said the source. But others close to Pecker insist he is staying out of the deal and just remaining with his ownership stake in AMI, which publishes such magazines as Muscle & Fitness and Us Weekly... Sources say that Cohen’s group has already applied to the Justice Department for a review under the Hart-Scott-Rodino Antitrust law, which is required on any deal amounting to more than $82M. Cohen’s clout in the industry comes because his Hudson News wholesale distribution company delivers magazines and newspapers to about 25% of the country, primarily in the Northeast and on the Atlantic coast.Cohen did not respond to calls and emails on Tuesday, but in a response to questions last week on his potential backers and lenders seemed to indicate he was talking to others — even if he would not name them.“Financing is fully in place and is not an issue, but is all under confidentiality agreement and therefore equity/debt issues cannot be discussed or disclosed,” said an email sent to The Post from Cohen last week.AMI is 80% owned by Anthony Melchiorre’s Chatham Asset Management... AMI declined to comment on any of the Cohen investors."
Vogue Reports Record Digital Traffic Aournd Met Gala
MediaPost: "Vogue noted record-breaking numbers on various digital platforms following the 2019 Met Gala on May 6. The focus was on camp in fashion, highlighting a new exhibit.The night-of brought a 22% increase year-over-year in unique views, while time spent was up 5% and page views increased by 30%. Vogue’s social media engagement also rose, with Facebook entries increasing 14%, Twitter entries increasing 27% and Instagram recording a whopping 96% increase in entries, all year-over-year.The outlet’s red carpet slideshow’s unique views increased by 97%.The increase in numbers came despite a decrease in posts of 5%. This year, Vogue published 149 pieces about the event compared to 157, revealing how efficiently it tailors content to its audience. “Planning our content strategy starts months in advance, and we’re ideating 10-months out,” Anna-lisa Yabsley, digital director of Vogue told Publishers Daily. “When it comes to deploying our content, there is no hard and fast rule as to when we begin.” According to Yabsley, the Vogue staff “observes social chatter, monitors spikes in search terms, and of course has a lot of historical data and research we can pull,” as it prepares coverage. This year, the outlet added some new elements that made the event feel more immediate to readers and viewer, including a “silent movie style” video shot by Cass Bird inside the cocktail hour, “which was entirely new for us both in terms of access and tone,” said Sally Singer, creative director of Vogue... Vogue saw a 153% increase in YouTube views through day five following the gala, a 47% increase in Instagram views and 1.6M average views per IG video, an increase of 31%, through day 7. Total Twitter views were up 3692% in the week following the gala. In all, Vogue gained 200 thousand new followers, generated 8.3 million responses, counted 207.3M owned impressions, 37.3M owned video views and 9.81M Twitter mentions."
UPS Store Buys Cover Wrap For Inc. Magazine
The UPS Store is taking over the cover and logo of Inc. magazine for its latest campaign targeting small-business owners. This month, 650,000 subscribers will receive magazines wrapped in covers that change Inc. into Ing… The UPS Store is marketing its resources for small business needs beyond shipping, such as faxing, printing, notarizing and shredding. The wraparounds will also run on the back cover of newsstand issues... On the front cover is Shanine Yngvason, founder of design and production studio House of Wolves, which makes leather goods. On the back is Bryanne Leeming, founder of Unruly Splats, an educational game that helps teach kids how to code. The interior of the wrap features advertorials about each entrepreneur. “The collaboration was an ideal match as Inc. has a national reach of small-business owners and entrepreneurs,” Karen Kelly, ad director at The UPS Store Inc. told Publishers Daily. The takeover was conceptualized, in partnership, with creative agency Doner. It is part of The UPS Store’s ongoing “Beyond Shipping” campaign, which launched last fall. “After a successful initial launch of the Beyond Shipping campaign, we challenged the agency to develop ways to further amplify our message,” Kelly said. “Doner teamed up with Inc. and developed this creative transformation — from Inc. to Ing.”The UPS Store and Inc. also produced a series of videos featuring entrepreneurs and their personal stories, created by Inc.’s branded content studio, as well as a contest for small-business owners to win $25,000."
OTHER NEWS OF NOTE:
Digital Sales Drive Target’s Better-Than Expected Q1 Comps
PG: "Helped by digital sales that continued to soar in its first quarter of fiscal 2019, Target Corp. has reported better-than-expected comparable-sales growth of 4.8% on a 4.3% increase in comparable traffic. Q1 comparable digital-channel sales rose 42%, on top of 28% last year, with these sales contributing 2.1 percentage points to its overall comps growth... same-day fulfillment services – order pickup, drive-up and Shipt – spurred more than half of its digital sales growth. The company also revealed GAAP EPS from continuing operations of $1.53 in Q1 2019, up 15.1% from $1.33 in the year-ago period, while Q1 2019 adjusted EPS were $1.53, a 15.9% increase from $1.32 in Q1 2018... Brian Cornell, chairman and CEO, [said]: "Throughout this year, we will continue to extend the reach of our same-day fulfillment options, strengthen our portfolio of owned and exclusive brands, remodel and open more stores and invest in our team"... The company’s total Q1 2019 revenue of $17.6B rose 5%, from $16.8B last year, reflecting sales growth of 5.1% combined with a 0.5% uptick in other revenue. Its operating income came to $1,135M in Q1 2019, up 9% from $1,041M in the year-ago period. Q1 operating income margin rate was 6.4% in 2019, vs. 6.2% in 2018, and Q1 2019 gross margin rate was 29.6%, vs. 29.8% last year, which the company attributed to higher digital fulfillment and supply chain costs, partly offset by beneficial merchandising strategies. Target said that it expected Q2 comps growth in the low- to mid-single digit range, mid-single-digit growth in operating income dollars and both GAAP EPS from continuing operations and adjusted EPS of $1.52 to $1.72, while for full-year 2019, the retailer still expected a low- to mid-single-digit rise in comps, a mid-single-digit increase in operating income, and both GAAP EPS from continuing operations and adjusted EPS of $5.75 to $6.05"...
Meijer Brings Home Delivery to Suburban Cleveland
SN: "Meijer Inc. has followed up the opening of its first supercenters in the greater Cleveland area with the launch of same-day online grocery delivery. Meijer Home Delivery, powered by Shipt, kicked off yesterday at three new supercenters that opened last week in Avon, Mentor and Stow, Ohio. Available to more than 90,000 households in suburban Cleveland, the service enables customers to shop a list of 70,000 items — including groceries, daily staples and other products — via the ShopMeijer website or mobile app and have their order delivered to their door within a few hours"...
Bernie Sanders to Attend Walmart’s Annual Meeting
PG: "Democratic presidential candidate Sen. Bernie Sanders, I-Vt., has revealed plans to attend Walmart Inc.’s annual shareholders’ meeting in its home state of Arkansas, according to The Washington Post and other published reports.At the meeting, set for June 5, Sanders intends to raise the issues of higher pay and more comprehensive benefits for the company’s employees, as well as to introduce a measure to give hourly employees a place on Walmart’s board. The legislator was reportedly invited by workers at the company to present the proposal on their behalf. “If Senator Sanders attends, we hope he will approach his visit not as a campaign stop, but as a constructive opportunity to learn about the many ways we’re working to provide increased economic opportunity, mobility and benefits to our associates--as well as our widely recognized leadership on environmental sustainability,” Walmart said in a statement. A longtime critic of the mega-retailer, Sanders has introduced legislation, along with Rep. Ro Khanna, D-Calif., to raise wages at Walmart and other large corporations"...
Amazon Turns Warehouse Work Into A Game
Washington Post: "Inside several of Amazon’s cavernous warehouses, hundreds of employees spend hours a day playing video games. Some compete by racing virtual dragons or sports cars around a track, while others collaborate to build castles piece by piece. But they aren’t whiling the time away playing Fortnite and Minecraft. Rather, they’re racing to fill customer orders, their progress reflected in a video game format that is part of an experiment by the e-commerce giant to help reduce the tedium of its physically demanding jobs. And if it helps improve the efficiency of work like plucking items from or stowing products on shelves for 10 hours a day or more, all the better. The video games are optional for the thousands of “pickers” and “stowers” across a handful of the company’s warehouses"...
How Much Bigger Can Dollar General Get?
Fortune: "By serving the bottom of the nation’s economic pyramid, Dollar General has generated one of the top performance records in retail. In 2018, the company reported its 29th straight year of same-store sales growth—despite minimal ecommerce. That’s a streak no other major U.S. retailer can match... DG racked up $25.6B in revenue in 2018 and eclipsed Macy’s in retail sales for the first time. Its stock is near an all-time high, giving it a market cap of $33B, five times higher than Macy’s'... DG is now the largest U.S. retail chain by store count, with 15,472 stores, up from 8,400 a decade ago. 75% of Americans now live within five miles of a Dollar General... “The dollar stores have become a lot more acceptable to all income demographics,” says Telsey Advisory Group analyst Joe Feldman. The privations of the Great Recession scrubbed these unglamorous bargain basements of their stigma; the economy came back, but the stigma didn’t. The industry has plenty of room to grow. According to Nielsen, dollar stores were the only category of retail whose total number of U.S. locations increased last year. But by some estimates, they account for only 4% of total retail sales.... Last year, [DG CEO Todd] Vasos told analysts that he thought the country had room for another 12,000 or 13,000 dollar-store locations; this year alone, Dollar General will open 975... The challenge is to make sure stretching doesn’t blow up a perfectly good business model. Having built its empire with the help of frozen pizzas and potato chips, Dollar General is making a bigger push into fresh produce, meats, and healthier fare—arenas where costs are higher and margins slimmer. It also aims to widen its footprint in larger cities and on the West Coast, where other dollar stores are better established and where it has less brand recognition... DG plans to change slowly and deliberately, tweaking only a small percentage of its stores at once. But not changing is not an option, says Vasos: “Retail is moving faster than ever, and you have to be flexible to ensure you’re moving where the customer wants you to move"...
OTHER NEWS OF NOTE: