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Taking “AIM” On Success With Innovation & Diversification – The Mr. Magazine™ Interview With Andrew Clurman – Chief Executive Officer and President, Active Interest Media

June 11, 2015

“I think the path to victory these days is opening your mind to what kind of businesses you can be in that may be obvious or not so obvious. And I also think to not being overly fixated quite honestly on digital as the singular path to prosperity for, call it, traditional media companies. I’ve seen a lot of people overspend and over-focus on digital and it’s grown their audience and in some case may have grown their revenue, but I haven’t seen a company transformed by just basically saying we’re going to go from print to print plus digital.” Andrew Clurman

“In our world we’ve got a lot of incredible loyalists and people of all ages who like the aesthetic of print, they like the print medium. And our print is profitable, it’s not the highest margin business that we have, but it’s profitable. I would say that it would be hard for me to imagine us getting out of print and just being event services and digital.” Andrew Clurman

andy Active Interest Media is a company that is as diversified as it is innovative when it comes to its business model and approach. With more than 50 internationally distinguished print, digital and social media brands, a video production company and first-in-class events, AIM is keeping its finger on the pulse of what’s important to today’s magazine audience.

In an exclusive survey published in 2014 and conducted by AIM’s Research Insights on the two types of newsstand buyers: Newsstand-Only Buyers, and Newsstand Buyers Who Also Subscribe to Magazines, there were some very interesting preliminary results, one showing that print magazines were the #1 choice of media formats that AIM readers said they would still be reading 2-3 years from now, bringing the company to conclude that print is clearly a magazine’s brand identity, and all other platforms build from the magic of print. A conclusion Mr. Magazine™ definitely agrees with.

Recently I spoke with Andrew Clurman, CEO and President of AIM, about how magazine-making had changed over the years and how the focus had changed from the traditional advertising-driven business model. We looked back to the infancy of AIM, checked in with today’s adult-aged business and also perused the company’s future seasoned years; from past, present and to its future, AIM’s evolvement has been and will continue to be highly innovative and interesting.

So, if you’re wondering where to ‘AIM’ your next ten or fifteen minutes, try sitting down, relaxing and enjoying the Mr. Magazine™ interview with Andrew Clurman, CEO & President, Active Interest Media.

But first, the sound-bites:

Clurman Headshot On how he thinks magazine-making has changed over the years: It used to be the way that you monetized an audience was by selling ads to people who wanted to, in turn, sell their products to that audience. That’s still true today, but to a smaller degree. Of course, there are exceptions to every rule. But relying on advertising as a way to build a business around that audience, and particularly a growing business, isn’t that viable anymore, in terms of any scale.

On how AIM actually brings forth magazines from ideas: First we start with the traditional filter of who’s the audience; how big is it; who’s the competition; what’s unique about this idea that’s going to win in the marketplace. It’s very, very rare that you have an idea for a magazine in an unserved market. The magazine that we launched, The Box, really had no competition and we thought fine, that’s pretty unique.

On whether he believes a magazine today can’t be created and stand-alone without the benefits of other platforms: I would say that we can survive; I don’t however think we will necessarily thrive. Launching a magazine is a lot easier than sustaining a magazine. The first issue sometimes is the easiest because everyone is all excited by this great story you have to tell. But by the second issue or the sixth issue or the 24th issue; you settle into some kind of normal state.

On the major stumbling block that he’s had to face over the years and how he overcame it: When it came to seeing all the changes in the marketplace and how we needed to create a much more diversified business, some of it was just keeping a very open mind about what is interesting and possible and what fits.

On his most pleasant moment: We opened our Boulder office in December 2013 with about 200 people. We have offices elsewhere, but we brought almost 50 magazine brands, other parts of the company and everybody here and we had a celebration of that. It was gratifying to see it and to say we’ve built a great company with incredibly passionate people and great brands and really interesting and different lines of businesses that we’re in, with a clear path to grow in the future, after struggling through the really challenging parts of getting up to a decent size and the incredibly challenging years of 2008 through 2010.

On whether he believes traditional media companies can exist without print: In our world we’ve got a lot of incredible loyalists and people of all ages, who like the aesthetic of print, they like the print medium. And our print is profitable, it’s not the highest margin business that we have, but it’s profitable. I would say that it would be hard for me to imagine us getting out of print and just being event services and digital.

On where he sees the company one year from now: We have three things that we launched this year and we’re hoping that they will become even bigger and more important next year.

On what motivates him to get out of bed in the mornings and say it’s going to be a great day: I’ve always been excited by ideas, whether they’re mine or someone else’s. And I love the power of taking an idea and bringing it to life and building a team and a business around it. So, I’m constantly thinking about the great ideas we have and how we can turn them into something real

On what keeps him up at night: (Laughs) It’s not coffee; I gave up drinking coffee. We’ve worked very hard to build a diversified, defensible, growing business, but you still just have to acknowledge at the end of the day that there are many things beyond your control. And not obsess about those things that may go bump-in-the-night.

And now the lightly edited transcript of the Mr. Magazine™ conversation with Andrew Clurman, CEO & President, Active Interest Media.

Samir Husni: Based on your experience, how do you think magazine-making has changed over the years?

Cover_BP_JUN15_Final Andrew Clurman: I think it starts with a much broader view of what is possible and necessary. At the core of magazine media and magazine-making, as you call it, is the fact that you still have to find a sizeable audience of people, a category of people, who share an interest, a passion and a pastime. People are always amazed at the number of magazines out there and they ask why there are so many sometimes. Just like they might ask, why there are so many gas stations or banks; as long as you can find a viable market and an audience then you deserve a place in magazine land.

It’s amazing that there are always people who find a different point of view or find an emerging interest and the best way to serve that interest and point of view is with a magazine. It’s hard to find a better medium that artfully combines the visual, aesthetic and written experience, or intellectual experience, that people get from the way that they consume magazines. It’s all the good things about magazines; the immersive way that people consume them, which is very different from almost any other media. It’s really hard to think of something other than a long-form or even some kind of service piece where you’re packaging information about complex subjects that works better than a magazine.

I think the basic form exists and has its own powerful place. It isn’t easily substituted, for certain genres of things, with any other media. And that’s what we look to do with our brand.

Samir Husni: Technically though, that’s the same way that we’ve always created magazines. Without an audience; there would be no magazines. So, how is today’s magazine-making different? One of your quotes from the presentation you gave at the IMAG conference in Boulder was: “We used to produce magazines for the advertisers.” How has this focus changed?

Andrew Clurman: All of the things that I just said speaks to the audience product and the way that you can command an audience. It used to be the way that you monetized an audience was by selling ads to people who wanted to, in turn, sell their products to that audience. That’s still true today, but to a smaller degree. Of course, there are exceptions to every rule. But relying on advertising as a way to build a business around that audience, and particularly a growing business, isn’t that viable anymore, in terms of any scale.

At this point when we look at a new magazine or an existing magazine, and ask what other things do the people who are in this audience need or want, and what can we deliver that is compatible with what we do and is complementary to what we do, so that those things would seem like a natural extension of our brand? And they have to be things that would be sizeable enough and able to rise above what used to be your ancillary revenue streams.

It could be that, and there have been cases of this over the years, you may have an event business that is powered by the magazine that’s actually financially bigger than the magazine, even if the magazine from a brand and audience standpoint is larger.

Samir Husni: You’ve been publishing new magazines, launching new titles, whether it’s about the practice of CrossFit with The Box magazine or Anglers Journal. When one of your team members comes to you and says that they have an idea for a magazine, do you have any criteria or any set of rules such as, if it meets A, B and C you go ahead with it? How do you actually bring forth a magazine from ideas?

Screen shot 2015-06-10 at 11.32.10 PM Andrew Clurman: First we start with the traditional filter of who’s the audience; how big is it; who’s the competition; what’s unique about this idea that’s going to win in the marketplace. It’s very, very rare that you have an idea for a magazine in an unserved market. The magazine that we launched, The Box, really had no competition and we thought fine, that’s pretty unique.

With Anglers Journal, there are probably hundreds of fishing magazines, if you count every local, regional and national one. I think the more crowded the marketplace, the more compelling the idea has to be, in terms of its uniqueness.

So, we start with that and then we ask the second question: what is the business model for this and how do we build a business around it? For example, with Anglers Journal we said there are legions of fishing magazines out there; this is a great idea for something that is about the art of fishing and why people fish, not about how to fish, so that carves out a unique place in that category. But we said none of these look like they’re really growing. The magazine business is not a really growth business for that category, so what else can we do?

Then we looked at the fishing tournament business. There is actually a very big fishing tournament business across a lot of different species of fish and we just bought a four-leg fishing tournament in the Bahamas called the Bahamas Billfish Tournament, and that business is already bigger than the magazine economically. We’re also now looking at a television show around the brand.

I think the difference is if I go back many, many years; we’re always looking for ways to build events, television or whatever, as extensions of the brand, but in this case we start with saying it has to be core to what we do because there is just not enough advertising as there was in the old days to grow and continue to grow something like this in the magazine business.

Samir Husni: Are you saying then that without these other extensions such as events and television, that technically we can’t just create a magazine that can survive on just being a magazine?

Andrew Clurman: I would say that we can survive; I don’t however think we will necessarily thrive. Launching a magazine is a lot easier than sustaining a magazine. The first issue sometimes is the easiest because everyone is all excited by this great story you have to tell. But by the second issue or the sixth issue or the 24th issue; you settle into some kind of normal state.

We do have quite a few magazines that stand alone as a print product, but very few of those are growing or have a very exciting growth path if they don’t have some other avenue that they’re actively chasing.

For example, we have a magazine called The Trail Rider, which is a nice little magazine that speaks for itself; it’s about people who trail ride their horses and the majority of ways that they participate in riding those trails. And for a while it was nicely profitable, with a specifically-focused audience. The advertising is made up of small, Mom & Pop outfitters and products. But it hasn’t really grown in spite of everything they’ve tried. And the cost side continues to creep up ever so slightly, so you look at the P&L and you find it’s on a downward trajectory. So, we went through this big discussion around what else we could do with it.

We looked at whether there was a Trail Riding Association that we could buy. Or could we start one. We own this program called USRider, which is our Triple-A program for horse-people and we have about 40,000 members. So, we came up with this obvious or maybe not too obvious idea.

People who are USRider members for the most part are people who go trail riding and they’re paying about $150 per year to be a member so they have towing insurance for their truck and their trailer. So let’s make The Trail Rider the official magazine of USRider, raise the price of the membership and everybody gets a subscription to the magazine and we increase the content to include some more information about their membership and benefits.

We did that going through a full year renewal cycle and it appears that’s going to really transform The Trail Rider magazine to a much, much better business.

Samir Husni: You’ve been in the business a long time and technically, with almost the same team, which is one of those rare things in the industry. As the business transformed, what was the major stumbling block that faced you and how did you overcome it?

LHL0815cover Andrew Clurman: I give Skip (Efrem “Skip” Zimbalist III) a lot of credit in this and I give Brian (Brian Sellstrom) who’s one of my other partners, credit as well; neither of them came from magazine publishing the way that I did. Literally, my second job out of college was in special interest media, but they came from different arenas. Skip worked at McKinsey & Company in strategic planning and Brian had different experiences, so they were not as steeped in the traditional business model of magazine publishing.

When it came to seeing all the changes in the marketplace and how we needed to create a much more diversified business, some of it was just keeping a very open mind about what is interesting and possible and what fits.

For example, when we were looking at USRider; we have private equity partners who have been fantastic, great and incredibly supportive and have given us all the capital we’ve needed to build the business. When we brought this one forward and said we want to buy this towing company, we don’t own the tow trucks, we have a service bureau that does it, but our partner’s reactions were that doesn’t fit with your business. You guys are publishers and that just doesn’t make any sense.

It took a fair amount of convincing and us saying just trust us and it does make sense; it’s a subscription business and a membership business. And it’s been wildly successful.

I think the path to victory these days is opening your mind to what kind of businesses you can be in that may be obvious or not so obvious. And I also think to not being overly fixated quite honestly on digital as the singular path to prosperity for, call it, traditional media companies. I’ve seen a lot of people overspend and over-focus on digital and it’s grown their audience and in some case may have grown their revenue, but I haven’t seen a company transformed by just basically saying we’re going to go from print to print plus digital.

Samir Husni: That’s why I refer to digital as the seductive, beautiful mistress roaming the streets looking for her next victim. (Laughs)

Andrew Clurman: (Laughs too). That’s a bit darker view, but there are a lot of false prophets out there of digital.

Samir Husni: Do you think traditional media companies can exist without print?

Andrew Clurman: As in phasing out their print?

Samir Husni: Yes. Phasing it out and saying that they’re saving so much money on ink, paper, distribution and mail that they’re just going to go full-blown digital.

Andrew Clurman: I think it depends on what kind of print they have. There are certainly many cases in the B to B world of B to B print businesses that have gone completely digital or mostly digital. In our world we’ve got a lot of incredible loyalists and people of all ages who like the aesthetic of print, they like the print medium. And our print is profitable, it’s not the highest margin business that we have, but it’s profitable.

I would say that it would be hard for me to imagine us getting out of print and just being event services and digital.

Samir Husni: What has been the most pleasant moment in your career that you can recall?

Andrew Clurman: When we started AIM and we literally came up with the idea in Skip Zimbalist’s kitchen, talking about what it might be and we started with a small acquisition of five, very disparate small magazines and it seemed a long, long way from our previous company which had world famous national special interest brands, so it felt like we kind of stepped way off the track.

We opened our Boulder office in December 2013 with about 200 people. We have offices elsewhere, but we brought almost 50 magazine brands, other parts of the company and everybody here and we had a celebration of that. It was gratifying to see it and to say we’ve built a great company with incredibly passionate people and great brands and really interesting and different lines of businesses that we’re in, with a clear path to grow in the future, after struggling through the really challenging parts of getting up to a decent size and the incredibly challenging years of 2008 through 2010. And sort of hitting a point where we had created what we thought was a great business; we had a great team and an exciting plan to go forward.

Samir Husni: Talking about going forward; if you would put your futuristic cap on for just a second and take us one year into the future, what would you expect to tell me different from today?

Andrew Clurman: We have three things that we launched this year and we’re hoping that they will become even bigger and more important next year and they fall into the category of one is film, video, production and sales. You were at the IMAG conference, so you heard Scott (Schulman) from Rodale talking about their ‘Rodale U’ and we have our own AIM Healthy U, so we have launched an online education platform where we’re producing and selling classes right now for everything from the business of yoga for people who are opening their own yoga studios, to gluten-free cooking and eating.

We do a lot of seminars and classes now in different categories; we’re doing Log Home University, where people come for a full day to hear about how to build and manage a log home’ we have a TrawlerFest University, where people come for two or three days to learn about boat maintenance and management.

I think we have a lot of class curriculum content that we can move to an online education format and sell it, frankly, for at least what we’re charging offline, if not in some cases, more because we can add more elements to the curriculum. So, that’s number one.

Number two is we’re growing our event business and have acquired a couple of event businesses this year and are looking at acquiring more. I expect that to be meaningfully bigger than it is right now and broader, in terms of a couple of exciting new categories.

And the third is that we’ve kind of taken a page out of the business to business generation model, which B to B companies have been doing that for years, which is content marketing to drive customer acquisition and we’ve launched a program to do that in our home category very successfully and we see that working in some of the other verticals where we have big-ticket items like boats, horses and ski vacations. Those are three things that I think we have good momentum on and I can see them as drivers across a lot of our categories next year.

Samir Husni: What motivates you to get up in the morning and say it’s going to be a great day?

Andrew Clurman: I’ve always been excited by ideas, whether they’re mine or someone else’s. And I love the power of taking an idea and bringing it to life and building a team and a business around it. So, I’m constantly thinking about the great ideas we have and how we can turn them into something real. That’s what has kept me in this business and also keeps me going.

Samir Husni: My typical last question; what keeps you up at night?

Andrew Clurman: (Laughs) It’s not coffee; I gave up drinking coffee. We’ve worked very hard to build a diversified, defensible, growing business, but you still just have to acknowledge at the end of the day that there are many things beyond your control. And not obsess about those things that may go bump-in-the-night.

But even given that, you’re constantly worrying or on the lookout for anything that can go wrong. I guess it’s like the old Spiro Agnew or Richard Nixon quote: if you’re not paranoid, you just don’t know whose out to get you. Just trying to live in an enlightened state of paranoia, I’d say, would be what keeps me up at night.

Samir Husni: Thank you.

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