Haymarket takes on the world

Lord Heseltine's latest launch is making a play for the download generation. He talks to Ciar Byrne
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The Independent Online

Lord Heseltine, publisher and former deputy prime minister, has a problem with some of the more conservative sectors of the British press. In particular with News International and its boss, Rupert Murdoch.

"It concerns me that people like Murdoch own our principal newspapers. They are now propaganda sheets. I happen to believe that Britain's self-interest is deeply ingrained in the European Union, and to have North Americans using their newspapers to grossly misrepresent the British self interest I find unattractive," he says.

And as for such newspapers allying themselves to the Conservatives, Heseltine says that the party has no right to see such support as a given.

A rumour that the Daily Telegraph would break its ties with the party under its new owners the Barclays proved to be unfounded, but the current editor, Martin Newland, does not share the open political affiliation of his predecessor, Charles Moore.

And in an interview with Media Weekly last month, the chairman of the Daily Mail and General Trust, Lord Rothermere, said: "The Conservatives do not have a God-given right to expect the loyalty of the Daily Mail."

Lord Heseltine understands this sentiment and sympathises with it. "The job of the Conservative Party is to make sure that they are attractive to a sufficiently large part of the population that the newspapers will not move away from them. The newspapers are in the business of selling newspapers. They won't sell newspapers unless they communicate messages that the population can accept. It's a symptom and not a cause," he says.

Michael Ray Dibdin Heseltine knows something of the journalists' trade. Since 1997 he has devoted about half his time to Haymarket, the magazine publishing company he founded - as Cornmarket - in 1957.

Lord Heseltine believes his experience of managing a publishing business helped him while he was in government. It also turned him into an unlikely champion of the The Observer when it was the subject of a takeover by The Guardian in 1993, which could have been referred to the Monopolies and Mergers Commission.

"Having run a business from very humble beginnings did influence my views about how to run a government department without any shadow of a doubt. When The Guardian took over The Observer it came to me as President of the Board of Trade. The official advice was great investigations and delays and I remember saying: 'Look, this newspaper won't survive your detailed investigation. I can tell you straight out that this is a perfectly reasonable and acceptable situation and I'm not going to refer it to lots of other people to second guess,' and I sent it through, I just approved it. I might not have done that if I hadn't had publishing knowledge. I know what it means for a publication to be under a cloud. I know what the advertising will do."

From its origins as the publisher of the Swinging Sixties men's title Town - the cradle for talents such as David Bailey and Terence Donovan - Haymarket has grown into the UK's largest privately owned publisher.

Since Lord Heseltine's return - as director in 1997 and as chairman since 1999 - the company has embarked on a campaign of global expansion, inspired by his ministerial travels. Haymarket now has some 1,700 employees around the world, with subsidiaries in the USA, Germany, China, Hong Kong, Japan, Singapore, India and Australia.

"Without any doubt, travelling the world as one did as a minister, one realised that there were very similar markets developing in most countries one visited. When I came back I discussed with my colleagues whether we shouldn't look to a wider market," Lord Heseltine explains. He also admits to having been influenced by the international success of Cosmopolitan magazine, under the aegis of former National Magazine Company boss Terry Mansfield.

Haymarket titles are now published in more than 100 editions around the world in 20 languages. The company's portfolio includes business and trade titles - from the advertising bible Campaign to Horticulture Week; specialist consumer titles, including Classic fm magazine and Gramophone; and customer magazines - for the British Army and Jaguar, among others.

The publisher last week filed its accounts for 2003, showing a slight fall in pre-tax profits (£13.9m for 2003, down from £15.2 million the previous year).

Its chairman admits that Haymarket fell victim to the dotcom boom, launching two magazines: Revolution, which struggled when the fledgling market crashed; and Internet Business, which has since closed. "We did one or two things in the dotcom world in defiance of economic logic and in 2001 we saw a very heavy correction. It didn't have any permanent effect on us, but it was a shock."

More recently, the company, which publishes several medical magazines, has been affected by a downturn in the sector. "The medical market has had a rough time, the worst I can remember. So holding our profits has had to be done in spite of the fact that a major part of our market is in serious decline."

Over the last five years, however, Haymarket has spent £37m on development and £45m on acquisitions, and it is confident that in 2005 profits will materially improve as these projects turn into money-spinners.

This month, Haymarket has launched Rip & Burn, a new title devoted to music downloading, whose first cover star is the rapper Eminem. This is the brainchild of Mat Snow, the editor of Haymarket's leading football title FourFourTwo and a former Mojo editor. Unlike traditional music magazines, album reviews single out the handful of tracks that are worth "burning" from an artist's latest release. Football is likely to be another area of expansion for the company, which already publishes the official magazines for Manchester United and Uefa.

Lord Heseltine believes the secret of Haymarket's longevity is the people who work there, describing it as "a rather emotional fact" that the senior managers and board members have all been with the company for a long time. Group managing director Eric Verdon-Roe is considered a "spring chicken", having joined Haymarket in 1976.

There is, however, a worryingly high turnover of more junior staff. Lord Heseltine insists they are leaving because of lifestyle choices and not salaries, which he calls "competitive".

"We have a high turnover of staff and it has worried us a great deal. I think we have a particular problem in that we are such a honey pot for people of a young age. For a lot of them it's their first job and after a year or so, quite a lot of them simply say 'let's go backpacking'. We have a very high reputation for training so our competitors are always stealing our people. I just shake my head and say you cannot expect people of this age and vibrancy not to move about, it's just not the nature of the beast. If they were all 50 they would stay, but it wouldn't be Haymarket."

Staff turnover may be a weakness, but Haymarket's strength has always lain in its high production standards. Town, a tired tailors' title when the company acquired it, never made any money in the 1960s because it refused "to do nudes", but it proved that high standards could be applied to trade and technical magazines. That lesson has stayed with the company, says Lord Heseltine.

"Our philosophy is very clear. We only introduce magazines that we like in a field that we like. Once we decide to do a magazine, we want it to be the best in its field. We don't always get there, but we keep trying."