The trade magazine that’s also a real estate developer

Flying is developing a high-end community for pilots

Hope everyone’s week is off to a good start. Mine has begun ideally: Surrounded by boxes in the midst of a move. The only good part of moving is witnessing the efficiency and skill of movers. In this issue:

• Flying’s Preston Holland on The Rebooting Show about how a niche publication geared to amateur pilots is building a real estate business, part of a trend of using publishing to power non-media business.

• What Mr Beast means for media, retail and brands

• The Athletic gets (big) ads

Quick request: Please share The Rebooting with friends and colleagues you believe would find it valuable. 

Flying’s big bet on air parks

Publishing is a great way to attract audience attention and foster authority in specific areas, only the business models have often lagged the value created. As Joe Marchese pointed out in an earlier episode of The Rebooting Show, media has often served as the front end to other businesses. After all, NBC was owned by Westinghouse and General Electric.

In niche areas, the opportunity is to use publishing as leverage in other related businesses. This is happening more broadly lately, as more brands are built with a community at their core. Consider: 

• Hubspot is using The Hustle to lower its customer acquisition costs and build the top of the funnel for its software business. CB Insights uses its publishing in a similar way.

• Penn Entertainment paid over $500 million for Barstool based on how well Barstool can promote and funnel gamblers to Penn’s sportsbook, a playbook that even Disney is looking into for ESPN.

• In newsletterland, popular business strategy writers like Pack McCormick and Mario Gabriele are using publishing to source deals for investments. Litquidity is memeing his way there. 

• As seen by the stampede created by Mr. Beast at the opening of his burger joint in a mall, there’s real power to having a tie with an audience. (Of course, the risk is a shitty product, which could very well be the case with Mr. Beast’s burgers.)

Flying, a 95-year-old magazine publisher focused on amateur pilots, is on this path. Craig Fuller, CEO of Freightwaves, bought Flying in July 2021 and a key part of the growth plan he and COO Preston Holland have begun is a massive bet on so-called air parks, basically resort communities with ample space to park your plane at your home. The Fields is a 1,500-acre development in Tennessee’s Sequatchie Valley that’s due to open next year. Plans call for 800 homes, 180 “vacation villas,” a runway and many private hangars for people to park their aircraft. The Fields is billed as “a luxury fly-in community for pilots, by pilots.”

The approach is somewhat akin to how Freightwaves uses its media arm in order lower the acquisition costs of its data business. Done right, this allows for taking a longer view of the value of different content products. For instance, Flying’s new management decided to keep the print edition and double the production cost to improve the quality.

“Marrying [editorial] with some other monetization strategy allows for you to make some decisions on the media side that you wouldn't necessarily make if you're trying to make all your contribution [margin] on the media side,” Preston said.

The move into real estate development came after Flying looked for space at an airport to build a studio, only to find none available. 

“We understood that there were these air parks all across the country that people actually live with their planes and you taxi out to the taxiway and take off and go wherever you want to,” Preston said. After seeing how well content around air parks did on Flying’s site and newsletters, they decided to go with the plan, securing the land and a promotion in Flying netted 300 in-bound requests, which has since grown to 1,200. All told, Preston says Flying has collected $27 million in deposits for The Fields. 

“If you look at real estate sales and the spread you can get on building a ground-up dev, the media asset is a very small fraction of the revenue, cost base and capital investment on the front end that you can pull through this monetization monetization effort on the back end to sell real estate.”

Check out the full episode to hear more about Flying’s innovative model. The Rebooting Show is available on Apple Podcasts, Spotify and Anchor. Thanks to Jay Sparks of Pod Help Us, who produced the episode. Check out Pod Help Us if you’re thinking of starting your own podcast. Or shoot me a note, and I’ll connect you to Jay. 

People vs Algorithms podcast

People vs Algorithms is a new podcast in which Troy Young and I discuss patterns in media, business and culture. The idea is to go a bit broader than the typical topics covered in The Rebooting to look more broadly at the media business’s place in both the overall economy and culture. In this week’s episode, we talk about what to take away from Mr. Beast’s burgeoning empire, why MAGA could become a lifestyle brand for our polarized times, and the growing power of Chinese ultra-fast retailer Shein. Give it a listen, subscribe, and let me know what you think. It’s on Apple Podcasts and Spotify. 

The Athletic’s new ads

As a reporter you’re inclined to not believe any company that says they’ll never do this or that. It’s not that they’re lying – well, sometimes they are – it’s just that businesses and contexts change, so anyone who wants to continue as a business must also adapt. In publishing, people who say “never ads” – and even market that loudly in their own ads – tend to end up running ads. Journalists are the only people who care about them going back on their word. It’s a misdemeanor, not a felony.

The Athletic has finally rolled out its advertising approach. And unsurprisingly it looks a lot like how The New York Times handles its ads. No open-programmatic or ad networks, bigger ads interspersed within the content rather than being relegated to the right rail. I give The Athletic credit for not tip-toeing into the ad experience. These are big ads.

If it isn’t already clear at this point, subscriptions and ads work well together. Subscriptions give you more data and show a qualified audience that isn’t just some arbitraged audience found through clickbait or the myriad growth hacks that many publishers rely on to fulfill promises of audiences they do not really have. Brendan Spain, vp of advertising at the Financial Times, recently made this point in AdExchanger and The Logic’s David Skok did as well in the new podcast by Jack Marshall of Toolkits. 

It’s telling that Chanel is the first advertiser. I presume that’s to show how The Athletic isn’t just for the endemic sports ad category of betting, booze and fast food. (Chanel is advertising anThe Athletic is clearly focusing more on content adjacency and less on mining user data for individual targeting, a smart decision at the relatively small scale of 4 million readers a month.

Subscriptions are just a tool, not an identity. Publishers are publishers, and the best ones marry their editorial and business models to be seamless. As David Skok pointed out, too often subscriptions are grafted onto a business model dependent on ads rather than vice versa. My assumption is the audience focus required to have a robust subscriptions business line will end up meaning a far less adversarial approach to advertising. The Athletic’s publisher, David Perpich, used the term “seamless,” which I think is right. You tend to be more mindful of people you see as customers rather than those you see as data points.

Thanks for reading.  Feel free to shoot me a note with feedback: bmorrissey@gmail.com.