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Females + Sports = Business Success
Sports Illustrated's Simpson rides the crest of the women's-sports wave
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Business New Haven
9/4/2001
By: BNH
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Cleary S. Simpson of New Canaan was named executive vice president of Sports Illustrated in November 1999, on top of her responsibilities as group publisher of Sports Illustrated for Kids (a position she has held since 1992) and Sports Illustrated for Women. She was in New Haven August 21 to keynote the Sports Luncheon presented by the Sports Council of the Greater New Haven Chamber of Commerce at the Connecticut Tennis Center during the Pilot Pen women's tennis tourney. A 21-year veteran of Time Inc., Simpson is a 1975 Phi Beta Kappa graduate of Connecticut College.
What was the publishing concept behind SI for Kids? Nine years ago I'm not sure people thought about the purchasing power of children the way we do today.
There were several rationales. One of them was that, during the [George H.W.] Bush administration, literacy was one of Barbara Bush's big causes celebre. We felt it was a really good time to: A. promote literacy among children by using their enthusiasm about sports to engage them in reading without their even noticing it.
I was thinking more in terms of the financial aspect.
We thought, 'We're a magazine company; it's important to get kids enthused and excited about reading magazines and establishing that behavior at an early age.' The third thing was that sports is just as important to children as to the adult fans, and we felt we had an opportunity to begin branding them young. There was starting to be a little bit of conversation about kids' purchasing influence. So we launched with a very aggressive in-school program where we donated subscriptions to census-defined under-funded schools across the country and created a teaching guide for teachers to create lesson plans around the magazine. It's been great, because it introduced the notion that you could actually use a real, commercially produced magazine with advertising in a classroom setting to great effect.
What was the ad sell - to establish brand identity at an early age?
Well, no [laughs]. We launched it in a very unusual way: we sold 'sponsorships,' which consisted of a ten-page commitment [one full-page ad per issue annually]. In the early days we were going out to major companies like AT&T, IBM, Pan Am - big companies that Time Inc. had a long-term relationship with, and saying, 'You guys need to get on board with us to show your commitment to literacy, and this is a great way to do it.'
What did that cost?
The starting price was $250,000. These were advertisers that didn't know about kids, or have advertising message that were geared to kids, but were really doing it from a supporting-literacy point of view. [Granted], those were the days when there were considerable philanthropic budgets at companies. So it was a fascinating sale and a fascinating relationship. We did, along the way, try to talk also [to advertisers] about reaching kids young with [their] message, but that really didn't happen until the 1990s.
When did SI for Women come about?
SI for Women as a business concept came about after the 1996 Olympics. There had been for years a real interest on the part of numerous people at Sports Illustrated to create a magazine for women.
How are the two magazines doing, and how would you describe their growth trajectories?
SI for Kids is doing great. It was profitable in its fourth year. It's about a $35 million business now; advertisers have truly believed in a long-term commitment to advertising to kids, in print. We always have to stay about five steps ahead of our target audience, because they move very quickly. This whole phenomenon about age-compression in kids…
What's 'age-compression'?
Kids today are doing much more mature things at a much younger age. They're essentially growing up faster. So [SI for Kids] is doing great. We have a licensing business that allows us to extend the brand; we still have the literacy program, which is part of our core mission. SI for Women is still new, doing well - we are about a year and a half old. We have a new editor for the September issue, so [the magazine] looks different - it's a little edgier, it's a little broader in terms of its ambition. A lot of readers said, 'We want to know about the WNBA and we want to know about college sports, but we also want to know about sports we might participate in [such as] hiking, adventure travel.' So we're broadening our mission.
How has the main title, Sports Illustrated, changed as a result of encroaching competition from titles with strong brand identities such as ESPN: The Magazine?
For many years SI was kind of alone, and to a certain extent still is alone in the weekly sports-magazine category [ESPN: The Magazine is published biweekly], because other people tried it and realized how expensive it is [laughs]. ESPN is a very strong brand. I think [competition] has made us a little bit smarter; you will see some sections that have been redesigned over the last couple of years. You will see some very successful new features such as 'Golf Plus,' and we're now able to tailor custom editorial and advertising to [selected readers] out of our three million [-reader] rate base.
What has changed in society over the last 20 years to make sports the conduit for such vast sums of money in terms of naming rights, sponsorships, endorsements, etc.?
It's incredible [laughs]. That's a huge question. I observe often with my jaw agape the amount of money that is spent…To me, sports is entertainment. I always thought of it, growing up, as there was sports, and then there was Hollywood. Now they [have converged]. From a marketing perspective, it's hard to reach males, harder to reach men than women through traditional media vehicles. There's a huge fragmentation of loyalties and media habits and opportunities. But the core passions of the sports fan are still strong enough to attract companies to huge-price-tag opportunities.
What, also, has changed in our society over roughly the same period to make women much more active participants in sports?
You have to go back to the 1974 passage of Title IX [which mandated that college spent equal amounts of money on men's and women's sports]. That [trickled] down from the college level to the local community level [influencing girls] at a very young age - plus being pushed from the other side by the feminist movement, I think. It comes down to six-, seven-, eight-year-olds. These girls need to have opportunities. From a sociological perspective, there's research that connects girls playing sports with lower levels of teen pregnancy.
Do you see tennis as the first sport where interest in the women's side of the sport has really surged ahead of the men's side?
Absolutely. It's interesting, because it's the one sport where women and men are often playing in the same venue, if not side by side, and clearly the personalities in the women's game have just been more interesting, and spectators just really gravitate to them.
Will technology make the magazine business even more 'de-massified' in the years to come, with products aimed at smaller and smaller slices of the demographic pie?
It's interesting, because we at Time Inc. have historically not been good at niche magazines; we tend to be a large-magazine publisher. We do those well and we do them profitably. The question is, can you also service these niches profitably? People often ask me, 'What about an SI for Kids for girls?' I don't honestly see it going that far. Unless technology drives down the cost of creating good printed products so much, you're still going to have to have a magazine that has at least 500,000 to one million circulation to really make it profitable. There are certainly plenty of trade magazines that have smaller circulation, but if you're talking about consumer magazines, you still have to do it on a dual revenue stream. You have more pressure rather than less on the subscription-revenue side: You look at a lot of the Condé Nast magazines, for instance, and the average [annual] subscription price is $12. Time Inc. is in an unusual place where we're able to charge a substantial premium to consumers, and 50 percent of our revenue comes from consumers, as opposed to other companies that are more advertising-driven.
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