David Carey, President, Hearst Magazines, spoke today at the Dive into Media about his business — and he had plenty of numbers immediately at hand to discuss the health of his business. His main goal is to reach three million digital subscribers by 2016 — slightly more than a threefold increase over its current digital subscriber base. That three million number would still only represent ten percent of Hearst's total subscriber base, but Carey was much more optimistic about tablets than that other print medium — newspapers. Carey acknowledges that competing with the free web is a challenge — "we're not going to put that toothpaste back in the tube," he says — but tablet-based magazines seem to be working to the tune of 160,000 digital subscribers to Cosmopolitan.
"We're trilled that Apple brought out the mini."
Interestingly, Carey says that initial concerns over Apple's decision to require consumer opt-in for sharing information with publishers turned out to be unfounded. Where he was expecting a very small number of readers to tell Hearst who they were, a full 65 percent have, which makes getting re-ups much easier. Carey also noted that he was very excited for the iPad mini. Apparently smaller tablets like the iPad mini and the Kindle Fire are more popular with women, Hearst's core demographic.
Bottom line, is Hearst making money on tablets and on mobile? The answer appears to be yes, and Carey says that he has Steve Jobs to thank for that, because he "taught consumers how to buy digital content." Hearst isn't yet charging a premium for advertisers on its tablet products, but Carey says that "we've established the case, because of the engagement, that CPM should be the same as the [print edition]." Eventually Hearst may charge advertisers more for digital advertisers — mirrors the same call for more premium ads on digital that Microsoft made yesterday for interactive TV: better data on consumers theoretically should equal higher prices for advertisers. Carey also says that Hearst is making money on mobile phones, but that it's more of a challenge than with tablets, "We and everyone else are in a period of huge experimentation on mobile."
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