'98 earnings drop 7 percent at Reader's Digest

Article Abstract:

Reader's Digest of Pleasantville, NY, posted a 7% drop in revenue, at $2.63 billion for 1998. Its earnings per share were down 56%, to 64 cents. As a result, the company's stock fell near its 52-week low, closing at 20 7/8 points recently. Reader's Digest attributed the decline to the recent strength of the dollar, lower mail quantities and lower response to promotional mailings. The firm intends to undertake a restructuring of operations as part of a three-stage plan to get back on track. It will announce on September 1998 how it will restructure cost and raise capital. While in December or January 1999, it will announce plans on how it will build business.

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Lycos acquisition signals familiar strategy

Article Abstract:

Lycos Inc., a Framington, MA-based online navigation service, will acquire Internet white-pages directory and free e-mail company, WhoWhere? Inc., in a stock deal worth $133 million. The deal will give Lycos, 9.3 million e-mail subscribers from WhoWhere?'s MailCity and 1.3 million registered members of personal home-page site Angelfire.com. The latest buyout reflects the ongoing consolidation trend happening in the portal industry. Melissa Bane, a senior analyst with Boston, MA-based The Yankee Group, states that the move is part of a three-pronged strategy that should be familiar to direct marketers: customer acquisition, conversion and retention.

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Reader's Digest begins net strategy with a $13M investment in WebMD

Article Abstract:

Reader's Digest Association Inc will invest $13 million in WebMD, a company that provides online medical information to consumers and physicians. Under the deal, WebMD will develop a consumer-friendly Web site for Reader's Digest, which in turn will supply content to WebMD. In addition, the two companies will cross-promote their sites. Reader's Digest has earlier announced its plan to spend $100 million to buy and invest in Web sites.

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