The Playboy bunnies have a message for college students returning to campus this fall: We want you.
Riding a wave of renewed popularity among consumers around the globe, Hugh Hefner’s Playboy empire is set to launch a sexy social networking site dedicated solely to college students, its latest online venture as it tries to reinvigorate its stagnant finances.
The launch of Playboy U, which has similar features to those found on Facebook, comes as Playboy’s 54-year-old magazine continues to lose money and readers.
To compensate, Chicago-based Playboy Enterprises Inc. is embarking on a one of its biggest expansion efforts in years.
“This is one brand that is relevant to 18 through 81-year-olds,” said Scott Stephen, executive vice president of operations for Playboy’s entertainment division. “We’re looking at this as a way to introduce and escort someone through their adult life.”
Playboy has cozied up to collegians before, featuring parties, promotional events and pictorials of student bodies from across the country. Now, executives hope Playboy U will help build brand loyalty among young consumers.
Backed by a hit cable TV show featuring Hefner’s three girlfriends, a Sirius radio channel and the adoration of young Hollywood stars again flocking to parties at the Playboy mansion, the company is trying to grow its licensing business and online presence and build an international fan base that includes a surprising legion of female fans.
Thanks in part to those initiatives, Playboy is gradually returning to profitability after years of operating in the red.
Last year the company eked out a $2.3 million profit, its second-best since posting a $47.6 million loss in 2000. So far this year, Playboy has earned $5.7 million.
But growth has been slow as Playboy wrestles with other struggling units, like its domestic television business that’s facing increasing competition and losing favor to other video-on-demand offerings. (Playboy executives said they’re working to stabilize the TV unit by offering their own on-demand lineup.)
“They definitely haven’t had the blowout kind of success that you would expect a big brand like Playboy to have,” said Rick Munarriz, a senior analyst with the investment advisory service The Motley Fool. “The brand seems to be having some kind of renaissance around the world yet, financially speaking, it’s not really contributing to the top and bottom line.”
The latest statistics compiled by the Audit Bureau of Circulations show the magazine’s average paid circulation has fallen to just under 2.9 million readers, less than half of the 6.25 million readers who bought the magazine during its heyday in 1974. During the first six months of the fiscal year, the magazine unit lost $4.7 million, 15 percent more than it lost during the same period last year.
Playboy executives said there are no plans to eliminate the publication, even as the company turns its attention to other parts of the bunny empire that include Playboy-themed casinos, clubs and apparel. Next month, Playboy will open its ninth retail store, stocking jeans, jewelry, T-shirts and cosmetics.
Playboy To College Kids: We Want You
Published in August 25th, 2007
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