BDG has also seen its advertising business affected by the writers’ and actors’ strikes that paralyzed Hollywood for months, according to two people familiar with the situation.
Marketing spend from the entertainment sector, which represents around 10% of its advertising business, declined. And the labor stoppages forced BDG to cancel key events, such as its activation at the Venice Film Festival, hampering revenue growth.
Additionally, the company divides its advertising business into two broad categories—luxury and fashion, and consumer packaged goods (CPG) and parenting—and the latter has struggled throughout the year, according to two people familiar with the matter.
BDG titles that cater to luxury advertisers, such as Nylon, Bustle and W Magazine, have performed solidly, according to two people familiar with the matter. But those in its parenting and consumer goods portfolio, such as Elite Daily, Scary Mommy and Fatherly, have fared poorly.
The saturated nature of the CPG space has challenged BDG, which entered into the parenting sector in 2021 with its $150 million acquisition of Some Spider Studios, according to two people familiar with the matter. The increasing dominance of retail media giants, particularly Walmart and Amazon, has also made consumer goods budgets more contested.
Shifts in strategy and personnel
BDG has embarked on a handful of commercial and editorial pivots to better position the company.
The media company plans to prioritize selling advertising by brand rather than as an aggregated network, a strategy similar to a pivot recently adopted by BuzzFeed Inc., according to a source. As social media and search platforms have throttled referral traffic, publishers have responded by focusing more on cultivating loyal readers and selling directly to sponsors.
Editorially, BDG plans to focus less on the volume of content and place greater emphasis on fewer, more focused editorial projects.
Experiential activations have also become a larger focus of its business. The brand has invested in building out its presence at key cultural touchpoints, including Art Basel, Coachella and New York Fashion Week.
Notably, Wagenheim, who has served at the company for seven years, will be leaving BDG early next year to become the chief executive of the soccer media company Footballco.
BDG plans to fill his role in Q1 of next year and is considering both internal and external candidates, according to a source familiar with its hiring strategy. It plans to preference candidates with expertise in the CPG and parenting space to help shore up the sectors.
The company also plans to reduce headcount across its sales and business teams before the end of the year. However, the layoffs will represent fewer than 5% of total headcount, according to a person familiar with the matter. No editorial cuts are planned.
Source link
