Ebony, the iconic African-American magazine, reaches over 12 million readers. But that's not enough for CEO Linda Johnson Rice. She believes that same audience is ready for a complete Ebony lifestyle from her new consumer products division.
Suzy Bibko is editor of Families in Business.
I have a dream. Those four little words are forever linked with Martin Luther King Jr and his hope for racial equality. But 11 years before King uttered that famous phrase on the steps of the Lincoln Memorial in Washington, DC, there was another man who likely said them. But this time it was in Chicago and race relations weren't exactly on the agenda, though what resulted has had a huge impact on the African-American community.
The man was John H Johnson, and he was begging his mother for $500 to start a magazine for African-Americans back in 1942. Being a good southern mother (she had moved to Chicago from Arkansas), she told her son she'd have to pray about the matter. After a week of consultation with a higher authority, she mortgaged her furniture and gave him $500 to follow his dream.
True to his word, Johnson used the money to form Johnson Publishing Company (JPC) and published Negro Digest. It was patterned after Reader's Digest, and filled with articles written by African-Americans. But, as this was 1942, Johnson had a lot of obstacles to overcome to make his dream successful – this was a time when a Black man wasn't called a "Black man" and Martin Luther King Jr hadn't even started high school, much less begun his march to freedom. And there was a world war going on, making the business environment a bit hostile for new ventures. But none of these factors deterred Johnson. Ever the entrepreneur, he created demand by enlisting his friends to go to every newsstand in Chicago to ask for copies of Negro Digest, creating an instant media "buzz". Later, he'd employ paperboys to hawk copies on the "L" (Chicago's elevated train), walking up and down the cars selling it to passengers. His hard work paid off: within a year, circulation was at 50,000.
Three years later, in 1945, things really started to take off. Seeing a need for a magazine that promoted the success and achievements of African-Americans, Johnson started Ebony magazine (his wife came up with the name). This was a big step in the publishing world, as Ebony was a monthly features magazine, complete with pictures and ads. As Ebony went from strength to strength, Johnson soon realised that there was another empty market that he could fill: the weekly news niche. So, in 1951, he started Jet.
Surviving and thriving
These magazines were important then, and now, because they really are two of the only publications that highlight the achievements of this growing minority population (and if
estimates are correct, by 2020 both the Hispanic and Black populations will no longer be ethnic minorities in the US as they are growing at a very quick rate). "We didn't have any magazines to identify with as African-Americans," explains Venetta LeRoy, a retired teacher and avid Ebony and Jet reader from Chicago. "[Johnson's] publications provided a lot of information for us – health, fashion, sports, food, entertainment – and that interested us. We finally had magazines that represented us and gave us people we could identify with."
Zena Martin, an African-American and managing director of Acknowledge Communications, a diversity communications consultancy based in London, concurs – from both a professional and personal standpoint. "The publications are important because, since their launch, what they have done is highlight the positives about African-Americans and their lives. They were launched at a time when that certainly was not happening in the mainstream media. I think that they're incredibly empowering, as well. They've lifted up an entire community and continue to do so." Martin says that the mainstream media tends to overlook Black people and their achievements, like actors in ensemble casts in television shows or movies. By not highlighting those actors' successes, it can alienate, or at least not attract, the African-American demographic to those publications. "It's just a fact," says Martin of the media's focus. "And in any media, people like to read about people like themselves. That is why Ebony and Jet are so important and why they've lasted for over 60 years. And speaking as an African-American woman, it makes me proud to read about all these wonderful things happening within our community and all of these great people who do unbelievable things that often don't get written about or talked about."
Today, both magazines are thriving. Ebony guarantees a readership of 1.45 million a month, while Jet pulls in 900,000 readers a week. At present, the only competition seems to be from features magazines Essence (targeted at African-American women and owned by Time Inc, a subsidiary of Time Warner) and Vibe (targeted at African-American men and women), but they're lagging behind by 33% and 50% fewer readers, respectively, a month. And O, while published by Oprah Winfrey, is aimed at women in general, rather than just African-American women.
Beyond the bindings
But just because JPC seems to have a handle on their competitors doesn't mean it's resting on its laurels. "I think there's a lot of competition and it just doesn't come from other magazines," says Linda Johnson Rice, Johnson's daughter and CEO of the company for the past five years. "It also comes from the internet, which is why we have really beefed up our internet strategy." She admits the company has been a little slow out of the gate with their web offerings, but with a new Chief of Digital Strategy now on board, she's seeing bigger and better things ahead.
But the internet is just the tip of the iceberg. Like many other successful business people, and indeed like her visionary father, Rice sees beyond the bindings of Ebony and Jet. She has already put the plans to paper to create a media empire that includes a whole lifestyle brand. Under a new division of JPC called JPC Consumer Products, they've already begun a licensing division. "We have Ebony and Jet, which are iconic brand names," explains Rice. "So, we've signed a deal with American Greetings cards, where we took past covers of Ebony that are so striking and terrific, really iconic covers, and we've turned them into greeting cards called Ebony Inspirations. The cards are now sold in Wal-Mart, CVS (pharmacy) and Jewel (Chicago's largest supermarket chain). That's just one licensing deal. The other is with a company called Dan River and they're introducing bedding and linens under the Ebony Home brand. That will be rolling out in Wal-Mart stores in July. We're also talking to a couple of licensing partners about Ebony Apparel, Ebony Baby and Ebony Junior. Ebony Junior is a magazine that we used to have, but no longer do. We're now going to put the magazine online. That's another niche that we can fill because there isn't a lot of interactive, educational information out there for African-American children and parents. We're also going to open up our photo archives. We have photographs that no one else has that date back to 1942. We're going to digitise those photos so that you'll be able to purchase them the way you can from the Associated Press or Corbis. So, there's a lot more we can do to grow the brand."
Indeed, it's an approach that's worked for Martha Stewart and her media empire. Even after Stewart's fall from grace and resulting drop in ad revenue for her magazine, the Martha Stewart Living brand seems to only be getting bigger. Once just touting white goods through Kmart stores, Stewart's offerings now include ready-made home furnishings, interior paint, business books, a satellite radio network, upscale home wares, and even the homes themselves in which you can put all this stuff and pretend to be Martha.
But while licensing is a smart business move, Rice is quick to point out that it's not all about the money for her and JPC. Her goal is clearly to grow the business – she is the head of a half-billion dollar company, after all. "But at the same time," she emphasises, "I want to be able to continue our philanthropic philosophy, to be able to give back in an educational way so that we, as a people, can advance forward." (On the personal/family side of things, Rice and her parents have been practising what they preach: her father made a monetary gift to Howard University to build the John H Johnson School of Communications; her mother has donated funds to Talladega University and also has made a gift to the Selma, Alabama YMCA where they are building a YMCA in her name; and Rice has recently given to the Annenberg School of Communications at the University of Southern California (her alma mater) to create Johnson Scholars, to fund scholarships for African-American students studying communications. "Education and communication are key to our business, so that's really where we have to put a lot of effort," says Rice.)
Rice believes that philanthropy is extremely important, especially for family businesses. "It's absolutely important," stresses Rice. "It's poor stewardship to run a business and not give back to your community or give back in some way. I think you'd be very remiss and a poor part of your community if you didn't give back. I think we're a very philanthropic company for a company of our size."
Giving back is certainly big business at JPC. Over the past 49 years, through a unique marketing concept, JPC has helped raise over $55 million for African-American charities. Linking with various African-American organisations, JPC finances the Ebony Fashion Fair, a fashion show that tours the US for six and a half months of the year, visiting a different city each night. The sponsoring charitable organisation sells the tickets and receives all the proceeds from the ticket sales. "It's a great promotional vehicle for Ebony," explains Rice. "With the ticket purchase, you get a subscription to either Ebony or Jet, so it's great for us for our subscriber base. But, more importantly, it really showcases the beauty of African-American men and women."
The Ebony Fashion Fair was again something that started under Rice's father. Approached by the wife of the president of Dillard University in New Orleans to put on a fashion show as a fundraiser for the school, Johnson saw an opportunity he couldn't refuse. He asked the then-editor of Ebony's fashion section to put something together, and she started the show in 10 cities. Johnson's wife then stepped in, as she loved fashion, art and culture, and took over from there, building it to become the largest touring fashion show in the world. Today, the show goes to 180 cities (none repeated in the same year), and sponsors need to sign up about two years in advance. "The organisations have benefited tremendously and so have we," says Rice. "It has been a wonderful thing for the company, a wonderful promotional vehicle, and it has been great to do this for charity." Indeed, the charities think so, too. Besides being an avid reader of JPC's magazines, Venetta LeRoy also knows the Ebony Fashion Fair well, as her sorority has been one of the sponsors, and thus, beneficiaries of its proceeds. "It's extremely well known in the community. The amount raised [in total over the years] is amazing, but I'm not surprised. Because, again, that was the only fashion show, like the magazines, that was geared for Blacks. And it has been successful as a result of that."
Something else that has been a successful outgrowth of the Ebony Fashion Fair has been a cosmetics company owned by JPC. While Johnson's wife was involved with the fashion show, she noticed that their models had to keep mixing and matching different cosmetics to complement their skin tones. She mentioned this to her husband and wondered if they could start their own cosmetics business. Johnson, true to his entrepreneurial roots, said "of course" to the challenge and started Fashion Fair cosmetics in 1973. Johnson already had contacts and resources in the hair care business from Supreme Beauty Products, a small hair care company he owned, so he parlayed that knowledge into the cosmetics arena. The first Fashion Fair cosmetics products were then sold as a "capsule collection" through a mail-order advertisement in Ebony.
"But my father realised that in order to be very competitive in the business and really make money, you had to be in department stores," recalls Rice. "His idea was always to test something in Chicago, your home ground. So, he went to Marshall Field's (Chicago's largest department store; once owned by the Field family, it is now owned by Macy's) and got an appointment to see the buyers there. He told them he was starting a cosmetics company, what he'd done in Ebony, the orders he got from the strength of Ebony's name, and told them that if they put his products in Marshall Field's, he'd advertise that fact in Ebony and that would bring the customer into Marshall Field's. And while a woman is in Marshall Field's buying Fashion Fair lipstick, she could also be looking in the other departments and buying other merchandise."
It seems like a no-brainer as there weren't any cosmetics available for African-American women, and the large department stores had nothing specific to attract that demographic. "It seems like a simple thing," admits Rice, "but it wasn't. At that time, my father was again a pioneer. There weren't any cosmetics for African-Americans and they (the department stores) at first said they didn't want any cosmetics for African-Americans. But my father said he could bring them additional customers that they didn't have. And that is really how he sold them. Of course, he got a space that was in the back corner and dark, but my father made the most of it, and now we're at the front of the store."
As the sales from this division of JPC are at nearly $50 million, it's easy to see that Johnson did make the most of it. He certainly seemed to have a knack of seeing a void in the market and taking advantage of it. This entrepreneurial spirit is something that was passed on to his daughter, as is evident with her desire to take the family firm to the next level, both through new business ventures and philanthropic endeavours. "I have a great deal of responsibility," admits Rice regarding what she has taken on as CEO. "And I enjoy that and want to do the best that I possibly can and not let people down. And most importantly, I don't want to let our readers down. I want to be able to supply them with the best writers, the best talent, the best information coming out of Ebony and Jet and our other businesses. I want to be able to disseminate information on a timely basis that they feel they can't get any place else and that really is proprietary for African-Americans. That is what my job its. So, do I feel a sense of responsibility? Yes. Do I feel overwhelmed? No." Sounds like she'll have no problem keeping her dad's dream alive.