Our post Hemmings to Digital Readers: Hurry Up and Wait drew a range of comments including offensive remarks from Hemmings staffer Richard Lentinello. The comment in question did not address the nature of the post and instead aimed to discredit myself and Mobilia Magazine, a publication I ran for eight years.
Lentinello referred to Mobilia as a “useless magazine” that “failed miserably.” Only in subsequent comments did another Hemmings staffer attempt to respond to the post’s stated subject of Hemmings digital strategy. So now we have two stories.
Hemmings disrespectful attack is a slap in the face to all entrepreneurs, fledgling publishers in particular. A number of publishing professionals have reached out basically saying “WTF” is this guy all about?
One way to answer that question is to address the matter of myself and Mobilia head on and, in so doing, attempt to educate Mr. Lentinello that his cloistered world is not the real world.
So for those interested in what it takes to develop a magazine and a market from the ground up are invited to read on.
Mobilia’s concept derived from a walk through Hershey 1991 in search of car collectibles ranging from old model kits to Gulf signs and pedal cars. Yet no single source of market and collector information existed for the thousands of objects that populated Hershey’s vendor tables and car shows throughout the U.S. and abroad. $8K for a gas pump globe anyone?! Having sold a successful technology publishing business in the late 1980s, I thought, why not launch a mag devoted to automobilia? After all, Toy Farmer had 52K paid subscribers and smaller niche pubs serving petroliana, art, and diecast also enjoyed unique loyal followings. On the other end we had 1M+ circ consumer titles with regularly published content on automobilia. Just about every car guy craves their favorite vehicle’s accessories and related merchandise. So bring them all together and Mobilia could become a universal marketplace. Brock Yates thought so.
Developing desktop publishing skills along with the then nascent Photoshop image software, sourcing printers, writing content, selling ads, and developing marketing plans fell solely on myself. This was 1993 when Quark page layout and Syquest drives were the hot new thing. Circ growth came from hauling cartons of magazines to events throughout the northeast, rolling out self mailers, onserts, bounce backs, and eventually a break-through direct mailing that took circulation from just over 10K to 35K in less than six months. That 600,000-piece campaign generated a 4% net yield and 90% cash with, and earned a Folio Gold Award. It was immediately profitable.
And the money? Ask any fledgling publisher and they’ll likely throw up their hands! In my situation it was selling two beloved collector cars and, at times, borrowing against credit cards to meet expenses. So I wrote a business plan and offering statement and raised angel funding to maintain growth and fulfillment while jumping into that new fangled world wide web. That was 1995.
Staffing grew from myself to a total of three plus a part time sales rep. 70-page issues loaded with ads and a wide range of editorial content and images became the monthly grind. Mobilia also went through a format change to respond to the exploding growth in motorsports collectibles including NASCAR. This change was accompanied by launching our proprietary data base to over 12,000 scale models indexed by marque and model maker.
Mobilia’s online home took root in 1994 as the first speciality automotive website catering to automobilia collectors and car enthusiasts at large. But by the 1997 time frame eBay was grabbing hold of just about every collecting category including automotive. Mobilia’s once-rich classified ad section was falling prey to online auctions and the lucrative space advertising showed early signs of topping out. We had a vibrant and sticky website at Mobilia.com but it lacked a commerce component; it was the typical “publishers” site of the time—an electronic version of the printed page.
By 1999 it was clear Mobilia Magazine would see further erosion from web pure plays like eBay. Cheap and instant advertising, hundreds of thousands of eyeballs—how do you compete? Plus it became increasingly difficult to rent essential mailing lists for direct marketing, and print costs were rising. So in 1999 I sold Mobilia Magazine to Krause Publications on an all-cash deal to focus entirely on a building Mobilia.com into leading e-commerce and online auction home for car lovers.
Around 1998 we entered into discussions with eBay management to partner Mobilia’s market traction with eBay’s auction platform. One year later eBay “Motors” materialized without us, essentially gathering the site’s transportation-themed content in one place and using everything Mobilia had developed. Still, we forged ahead in the belief we could carve out a healthy niche in motorsports merchandise. Between raising venture capital, staffing to 30, building a warehouse for direct inventory fulfilling all manner of automotive diecast and merchandise, and signing strategic partnerships including AutoTrader, Mobilia.com nonetheless fell victim to an evaporating investment climate during the dotcom bust of 2000. Our business plan required funding through to break even and we just didn’t make it.
I learned more in eight years than I believe many do in a lifetime. Obviously I wish it had ended differently but sometimes its about the journey and not the destination. Some 90+ published Mobilia issues populate readers bookshelves throughout the world. There was no safety net, no corporate war chest of cash and support, no 401K, no company picnics, no four-decade brand legacy. Yet Mobilia Magazine was covered in The Wall Street Journal, Mobilia.com became an auction partner with Amazon, and our team simultaneously unified a previously scattered group of smaller collecting groups into one cohesive marketplace along with specialty automotive equipment and accessories—a total market of 28$B in the U.S. alone.
That’s my story, now here’s a snapshot of Hemmings…
Prior to ACBJ’s ownership, publisher Terry Ehrich operated Hemmings in the fashion of benevolent despot and I say this in the most complimentary terms. Under Ehrich’s management Hemmings became the industry’s “Bible” of classified collector car ads. Its simplicity appealed to everyone with a car or part to buy or sell. Yet Ehrich avoided growth and expansion like it was cancer, including the web. Ehrich also disdained editorial content and only reluctantly published Special Interest Autos (SIA) because he thought road testing old cars was cool.
At Ehrich’s passing, Hemmings was shopped to acquirers for numbers north of $20M to eventually sell to American City Business Journals (ACBJ) in 2002. (Ehrich turned down $50M from eBay a few years prior). New management was installed the following year, SIA became Classic Car, and other pubs and products were launched along with an odd mix of feature articles within Hemmings front pages. Little does Hemmings realize that auction reports and price guides operate cross-purposes to the free market nature of classified advertising but that’s another story.
As of 2011 audit figures, Hemmings’ paid sub and newsstand totaled 204K of which 173K are paid subs. At its height prior to ABCJ, Hemmings circ was in the 285K range. Currently Hemmings staff numbers 100, and is backed by ABCJ’s infrastructure of multiple titles and newsstand relationships. Hemmings web strategy has been the subject of much discussion here at CPI. Look no further than the latest post to grasp Hemmings dependency on print and resulting online handicap. Would a Hemmings acquisition today realize anywhere near twenty million? I’ll leave that to the M&A experts to weigh in.
For every Kodak married to film, there’s a hundred fast movers like Instragram unencumbered by liabilities disguised as assets. I stand by my post’s concluding remarks that Hemmings is Bennington, Vermont’s version of Kodak’s decaying company town of Rochester, NY. A business with all the needed elements to succeed but without the vision and execution to mercilessly revamp their business model for the future. Today’s profitability does not assure tomorrow’s. Andy Grove, co-founder of Intel, said it best: ”Cannibalize your own business or others will do it for you.”
Experiencing every corner of the business world, the highs and lows, what works and what does not, proving through doing, having skin in the game… I believe that anyone with a similar background has something uniquely valuable to offer, and my clients seem to agree. Publishers attempting to survive today’s digital world are not finding solutions from peers stuck in the same quandary. They need battle-scarred veterans who’ve been where they are about to go.
A recent post cited the end of over 38 pubs from 2011, and nearly 40 disappeared in 2010. I can only imagine what Mr. Lentinello thinks of them. As publishing entrepreneurs, we are offended by his mean-spirited attack on the very nature of creative and forward thinking individuals who chose the path least traveled.
Have a story of your experience in publishing you’d like to relate to CPI readers? Please send it along.
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