John Loughlin, chief executive officer of magazine subscription service Texture, is setting his ambitions high, even in a highly competitive media market in which consumers are loath to open their wallets.
“The objective here is this should be a mass consumer service,” said Mr. Loughlin.
But Texture still has a long way to go, and is focused right now on increasing product awareness and making sure more potential consumers know about the so-called “Netflix for magazines,” which charges $9.99 per month for the basic plan or $14.99 for the premium plan, which also includes unlimited access to weekly magazines.
As part of this marketing effort, Texture began this week a tie-in with Home Shopping Network (HSN) that will run through the end of the year. The agreement is multi-faceted, and is meant to provide returns to both companies.
Texture’s editorial content director Maggie Murphy, a veteran of People and LIFE magazines, has already begun appearing on HSN, highlighting “must-read and exclusive articles, stories, tips and recommendations” from magazines that appear in the Texture app. There will also be paid segments on HSN meant to promote Texture, as well as brand integrations.
For HSN’s benefit, the network’s catalogs will be featured in a new “Shopping” tab on Texture, and items will be featured in Texture collections, as warranted.
Sean Bunner, an HSN executive focused on new business development, said the Texture partnership is part of the network’s Brand Marketing Alliances program, through which they’ve worked with companies including Toyota, Ford and Norwegian Cruise Lines. He said Texture has an “innovative editorial perspective” and “a service that sells better with demonstration and explanation, which HSN’s platform for storytelling is uniquely suited for.”
Mr. Loughlin pitched the HSN partnership as a test of whether content and commerce can truly work hand-in-hand. HSN and Texture, he said, do well with similar audiences: mostly women in their mid-30s to mid-50s who live in high-income households.
As a private company, Texture has never revealed how many people subscribe to the service, but Mr. Loughlin confirmed the number is “substantially in excess of” 200,000. Between the end of 2014 and the end of 2015, Texture saw 52% growth in net paid memberships. Mr. Loughlin said the company is targeting between 40% and 50% net growth for 2016.
Texture is not out there alone, though. The service was launched in 2010 as a partnership between media giants. In addition to providing funding, these companies — Condé Nast, Hearst, Meredith, News Corp., Rogers Communications and Time Inc. — provide Texture with in-kind advertising. The service, formerly known as Next Issue Media, was re-branded and re-introduced in the fall of 2015.
Last year, Texture spent almost $50 million on advertising, when factoring in cash purchases and in-kind advertising provided by its publisher-owners. Mr. Loughlin predicted that Texture would have a similar ad spend in 2016.
Texture is well-capitalized, having raised $130 million since the end of 2014 — $80 million from the media companies that launched it, and $50 million from investment firm KKR.
But Mr. Loughlin hinted that Texture could raise even more money at the end of 2017, “assuming that projections hold.”
Asked whether profitability is a goal, Mr. Loughlin said, “The objective is not to force this business to break even. Our objective is to force this business to grow … ” Subscibers are expensive to attract, he said, but normally remain customers for a long time.
The fate of Texture is in some ways linked to that of the magazine industry, which is changing rapidly, as companies that once relied solely on subscriptions and print advertising are now looking to social media platforms and live events, among other opportunities, for new revenue streams. Mr. Loughlin acknowledged that magazines are an industry in transition, but said the business has “proved incredibly resilient and fairly healthy.”
While advertising fluctuates, he said, the consumer side of magazines has been more stable. “Consumers haven’t abandoned magazines,” he said. “I think advertisers just have more choices, which creates pressure on some of these publishers.”