Forbes is one of a handful of publishers that has managed to offset declines in print advertising with growth in other areas of the business.
While digital is a key factor - 80 per cent of its ad revenue comes from digital - Forbes’ chief executive Mike Perlis suggested less of a reliance on advertising and an “enormous” investment in non-advertising related businesses has helped the company stay in the green.
With 80 per cent of Forbes ad revenue now coming from digital, print is dwindling. Perlis said: “We would love our print advertising to be growing in double digits the way digital is but it is not, and we don't see those days returning.”
To counter this, the publisher is focusing “an enormous amount of revenue” on non-advertising related businesses that carry the Forbes brand but use it in a non-media environments. This includes Forbes Travel Guide, Forbes Investment Guide, Forbes Video among others. The publisher is also expanding into new branded product areas in travel, education, entertainment.
On the TV front, in 2002, Forbes partnered with Fox News Channel for the launch of a business show 'Forbes on Fox'. The business has also ventured into real estate where it has licensed the Forbes name for a Forbes Media Tower in Manila, Philippines. Forbes receives an upfront fee for the use of the brand name plus royalty on revenues. The development of towers in other cities around the world carrying the Forbes name is currently being explored.
It has also partnered with the not-for-profit Ashford University – an online university – to create the online Forbes School of Business. Ashford University has used the Forbes name as well as its content to create online courses and some of its contributors, staffers and executives as guest lecturers.
"We see business education online as an opportunity that we can export around the world with our current partner in the US and other partners globally," Perlis said, "We could envision, for example, creating Forbes business English language courses."
Forbes may also look to explore financial services products, like creating a venture capital fund and the travel space.
The idea, spurred by Perlis when he joined the company in 2010, is to make the business of Forbes as big as “the perception and the broad-based recognition of the brand itself”.
“I have always felt from the time I joined the company that we have enormous latitude to grow the business, to fill out our brand” Perlis continued, “The Forbes brand has extraordinary and very positive equity in the marketplace, so much so that the brand is outsized in a way. By comparison our business is relatively small.”
New franchises like Women@Forbes and 30 Under 30 are attempts by the publisher to position itself as more of a youth brand. The money is in the millennials, since that is who advertisers want to reach, Perlis muses.
To capture that audience, the brand is putting emphasis on youthful messaging and digital delivery. In the past few weeks, the site has featured articles with 'millennial' and 'Pokemon Go' in their headlines daily.
Now, nearly half of visitors on the Forbes site are millennials, Perlis claimed. Over the last seven years, Forbes magazine has seen a 50 per cent increase with readers aged 18-34 – the largest increase of all 144 publications measured by MRI.
The question is how to maintain its signature C-suite audience while writing to a younger demographic. Perlis said “the two are not mutually exclusive” and Forbes is working to “unite those two groups” around all of the issues of building businesses.
“It is age neutral in a lot of ways” he added.
What’s more, the brand is looking at expanding its global presence. As it stands, there are 36 local licensed editions of Forbes magazine. The goal in the second half is to further expand in Western Europe, Africa and Latin America, and build out offices in San Francisco “the home of technology” and Hong Kong, to be close to its investors.
In a memo to employees announcing the first half financial results, Perlis wrote: “As we grow, we’re keenly focused on getting out in front of the challenges that media companies face today in the marketplace, such as ad blocking (which we took head on beginning last December), softness in direct sold advertising campaigns, declining print advertising, platforms like Facebook and Google which are taking the lion’s share of mobile advertising, and mobile monetization.
“As the nimble organization that we are, we’ve shown that we can pivot when necessary and we can count on the stewardship and strength of our teams to help us navigate an ever-changing media environment.”