Yes, even the most famous companies can get hit by the financial crisis. For example Condé Nast Publications. I guess it doesn't ring a bell.. But it's a famous American magazine publisher. They publish magazines like Vanity Fair, Vogue, The New Yorker,..
They are well-known for its extravagant parties. So money is definitely not an issue! Photographers even get paid for pictures that aren’t published!
But now it seems that the glory days are over.. The audit results weren't good, and it’s time to cut through their budget. Mc Kinsey and Company were called in, to advise Condé Nast in reducing their costs.
The duration of the project was 3 months. The results are quite harsh, because several magazines have been told to cut about 25 percent from their budgets. The magazine Business Week proposed a 20 percent staff layoff along with cutting costs on art and illustrations.
According to the Audit Bureau of Circulations, Condé Nast brought in 2 million $ less, in the first 6 months, than they did the year before. But according to the audit results, the biggest problem is the advertising, which is one of the biggest sources of income. When you look at all their magazines you can see a downfall of 8000 advertisement pages.
Due to the advertisement plunging, Condé Nast had to close 2 magazines in 2009, Domino and Condé Nast Portfolio. This gives you a clear view of how hard the company has been hit.
What will happen next?
You can find the article here.
