Reader’s Digest sold for a quid

Reader's Digest sold for a quidReader’s Digest is pledging to go back to basics and target the over-50s market after being bought by venture capitalist Mike Luckwell for only a pound.
The move marks the end of a disastrous three years for the UK publication, which was bought out of administration by Better Captial group – led by entreprenuer Jon Moulton – for £14m in 2010.
Since then it splashed out £23m on a direct marketing division – DM Partners – which aimed to offer campaigns from conception and creation to delivery. This was scrapped in January 2013 with the loss of over 100 jobs; the company began insolvency proceedings in the same month.
Moulton said he is now selling it because “from the viewpoint of the fund, the business didn’t justify the time and effort for us”. It is also thought that protracted negotiations with the US company – which still owns the name and demands a percentage of profits to use it – was at the heart of the financial woes.
Luckwell now plans to concetnrate on the over-50s, claiming that in the UK over 22 million were over the age of 50, but that just 10 per cent of the total advertising spend in the UK each year was used on campaigns targeting the senior market.
He also plans to launch a digital customer acquisition and delivery strategy, following the acquisition of the publication’s database of over 1.5 million, which will bring the group total to 2.7 million.
“This acquisition of Reader’s Digest is important to the growth of what is at present still a small group with sales of only £20m or so in the coming year but watch this space,” he added.
Along with Book Club Associates, Reader’s Digest was one of the first UK companies to embrace direct marketing, and was the stamping ground for many of the DM industry’s founding fathers. Its subscription marketing programme led the way in the Seventies and Eighties, although its reliance on prize draws and promotions did draw criticism from some quarters.

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2 Comments on "Reader’s Digest sold for a quid"

  1. RT @DM_editor: Reader’s Digest goes back to basics after being sold for a quid http://t.co/kZ4W5TRGts #directmarketing #data #digitalmarket…

  2. Reader’s Digest goes back to basics after being sold for a quid http://t.co/3vNJAsZl91 #directmarketing #data #DigitalMarketing

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