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Gruner & Jahr Warns of “Streamlining” and “Sacrifice”

News, 07 January 2002


The new year does not appear to have brought much joy to the ailing American magazine industry, judging by a warning from Gruner & Jahr USA’s publishing president/ceo Dan Brewster that staff should prepare themselves for “streamlining” and “sacrifice”.

In a memo to employees, Brewster vowed to allocate resources to titles with most potential for growth; one magazine consequently expected to suffer is Homestyle, which suffered a 26.9% drop in ad pages from January to November 2001.

“Absent any further deterioration of the advertising environment, we will be able to offset most revenue shortfalls through streamlining corporate functions and managing our operations more efficiently,” announced Brewster.

“In order to retain shareholder – and ultimately employee – confidence in our ability to manage our business successfully, we cannot embrace growth without also accepting the need for sacrifice.”

Such sacrifice appears to include job cuts. The memo orders division bosses to “review any job descriptions that overlap or result in inefficient reporting lines,” while January’s pay rises have been put off to “reduce the need for more aggressive headcount reductions.”

The group saw total ad pages fall 14.2% from January to October last year, making G&J one of the worst-hit magazine publishers.

One salary G&J will no longer have to worry about is that of senior vp–corporate sales Ken Wallace, who has announced he is to leave the group. His role will be taken over by chief marketing officer Cindy Spengler.

News source: AdAge.com