Quarto Creative

Louanne  Welcome to “Covering the Spread, Magazine Design for the Next Age,” a monthly discussion of all things related to our favorite medium, magazines.

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Scott  Whether you’re a seasoned designer, an aspiring creative, an editor or publisher, or just someone who appreciates the art of storytelling through visuals, this is the place for you.

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Louanne  I’m your host, Louanne Welgoss from LTD Creative, a graphic design firm located in Frederick, Maryland, and I’ve been working on publications for thirty-two years. You can see our work at LTDCreative.com.

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Scott  And I’m Scott Oldham from Quarto Creative, who’s been making magazines for twenty-five years. You can see my work at QuartoCreative.com. And on this podcast, we’ll chat with industry experts, designers, editors, and production pros to uncover the secrets of all things magazine.

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Louanne  It’s time to turn the page and what you thought you knew and reimagine the future of publishing.

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Louanne  Welcome to Covering the Spread, the podcast where we talk about the evolving world of publishing, media design, and content creation. And today, we’re joined by Scott Jamieson, CEO of Annex Business Media, to discuss how one of Canada’s largest business to business media companies is navigating the changing publishing landscape through digital growth events, acquisitions, audience data, and AI. That’s a lot, Scott.

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Scott J.  It is a lot. That’s what we do.

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Louanne  So tell us. We’re going to kick it off by telling us a little bit about: How would you describe Annex Business Media today to someone outside the publishing industry or for that matter, inside the publishing industry?

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Scott J. So we are Canada’s largest B2B media company — not one of them, but the largest B2B company in Canada. And we are omnichannel. That’s our best description. We are channel agnostic. So we still have quite a bit of our businesses in print advertising and print publications, but we have a large digital footprint. We run webinars, podcasts, we do research, we have live event business and a virtual event business. We do 75 events a year across our 55 markets, and we are acquisitive. The name “Annex” is a deliberate name. It means we annex other companies, and that’s how we’ve grown in our almost 30 years. We’ve done 26 or 27 acquisitions in our 29 years. So that would be a high-level overview of what we do at Annex.

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Scott O.  So among those acquisitions, what’s the kind of thing you look for, or that Annex looks for in a publication property?

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Scott J.  Well, for the first 15 years or so, we looked at scale. We were trying to flow our operations and trying to scale our efficiencies. And so we really just looked at any industry. It didn’t make any difference to us what the revenue mix was. We were really just trying to get to a sort of 35-40 magazine level that we thought would be very efficient from that point on. So for the last 10-12 years, we’ve been trying to fit magazine brands or media brands into groups that we already have now. So that’s agriculture resources, heavy construction, public safety… and I’m missing one in there, and then some miscellaneous ones from early acquisitions. So we want them to be bolt-ons, if you will, to those groups. And I would say in the last three or four years, we really look at revenue mix. Like everyone, we’re seeing that steady decline in print advertising. And so we don’t want to buy another magazine that has 90% of their revenue coming from print advertising. We think we’re just going to be in the managing decline industry. So we’re looking at magazines or magazine groups that have a similar revenue mix to Annex, and that would be 37% digital, 35% print revenue, almost 20% events, some e-commerce and then some miscellaneous. We prefer a mixed revenue bag when we look at it. Now, that’s not to say we won’t buy something else if we see something that’s heavy to print, but we believe there’s an event there that could be created, then we’ll do that as well.

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Scott O. So you mentioned declining ad revenue. This is a topic that comes up repeatedly among our industry contacts and partners. What have you seen the trend being in the last, let’s say, 15 years or so?

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Scott J. Pre-COVID, we were looking at a — what I would call — managed decline, a slow decline, 2-3%a year on average. We have enough brands that some of these brands actually can still manage to grow print, but that’s few and far between. COVID, we saw pretty close to a 20% drop just in 2020, and that has not recovered. And since then, we’ve seen that decrease more in the 5-7% per year range. It’s not slowing down. Now, some of that is deliberate on our part. We’re trying to optimize the number of issues we have, the frequency of our issues in markets where we’re seeing that decline so that we better match six issues, if the revenue is declining versus eight, for instance. We have a very deliberate process of determining when to remove an issue. So some of that is not market trends. It’s us.

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Scott O. Well, so what’s their rationale for scaling back? What do they tell you?

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Scott J.  Mostly they don’t tell us anything. You have to have that conversation. We know through our research — our own research into our audiences — that our audiences adore the print products we have. We have the research to back that up. We know from other research that advertising recall and content recall is far better if somebody is dealing with a physical copy of something, and that includes children and their education. But the advertisers are all about data and wanting to be able to say, “I ran this big box ad on your website, and I got a click through rate of half a percent.” And they’re happy with that. That’s a success because you have data, right? We know from research: If we send out a magazine and you have a full page ad in it, we can tell you roughly what the percentage of our readership is going to see it on any given issue. And it’s way higher than half a percent. And the impact is way more significant. But that’s not a conversation anyone wants to have. Having said that, I think we are going to see a bit of a reinvigoration of print, at our company anyways, and we’re investing in that at the executive level to bring an executive in who is going to help us optimize our print product — to make it more premium — and to find content strategies, packaging strategies, and design strategies to make them more impactful. We think in the age of AI, it’s going to become a more interesting product for readers, but also for marketers who are trying to stand out a little bit more and find a credible vehicle in which to be seen. And you can’t get more credible than an audited B2B magazine where every piece of content has a human being’s name.

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Louanne  We’ve had other guests on our podcasts that have talked about their magazine and not publishing as much, but doing a very special publication once a year or twice a year or something that has the most impact. We’re seeing this trend also appear on the newsstands, where we’re not seeing what used to be monthly magazines; we’re seeing very special big publications with super nice paper, extra bits of this and that. Is that what you’re talking about doing?

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Scott J.  We don’t have many magazines that publish less than at least four times a year, and we have a couple that are one or two times a year. But those are particularly super niche areas like drainage. Agricultural drainage. we only do twice a year, for instance. Very niche topics. But most of the time, we’re four to six issues a year. We still have some at ten. And we’re also very fortunate in Canada. We don’t have the postal cost pressures that you have in the United States for print magazines. And so we still use very high-quality paper. Our covers are 100 pound to 80 pound, very glossy stock. We have many magazines where we just use 70 pound throughout. So it could be a 100-page magazine, all 70 pounds, a beautiful, beautiful product, perfect bound when we get up to that size. So we’ve been very fortunate, there. We do have a couple of American magazines where we’ve had to go to much lighter paper, and you definitely feel the impact. It’s really hard to say it’s premium when you hold it, and it just sort of flops like a napkin, right? What I’m more referring to is just being more deliberate in the editorial package that you make. And this is not new. Those of us who started in the magazine business, like I did in the late 80’s, early 90’s, you had an architecture to your magazine where you had a plan of the kind of content you were going to share with your readership — very serious commitment to that plan and that architecture, and also the mix you were going to give them throughout the year, depending on who was in your audience. Over time, as we focused strictly on the digital and event side of the business, we lost sight of that to a certain extent. And our newer editors coming into the business who are more digital-first, don’t have that skill set. When you step back and think about it, it’s obvious. And so we’re actually taking chapters from an old book from the American business press going back to the 80’s. And they have two chapters on architecture and design of magazines, and that’s our training. It’s kind of back to basics that will have, I think, a significant impact on the reader experience, but also on the relevancy for advertisers. Advertisers don’t see themselves as being relevant to those magazines. We need to engage them more to get them involved in the conversation to help us plan. So that’s part of what this new role will be leading. Because if you don’t have somebody in the executive team driving it, it’s just a conversation.

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Scott O. Scott, tell us how a niche company like the ones that are within your audience group, can expect to receive a magazine from Annex Media. How do you find the companies that you are going to distribute your magazines to?

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Scott J. There’s a couple of ways we do that. One, we still buy some lists from time to time in given industries, and then we reach out to them to see if they would like to receive the magazine. The business model in Canada is much like it is in the States for B2B magazines. The magazines are free to qualified individuals of certain job titles in certain industries. And because we still audit our magazines, we know this to be true. Our events create a nice flywheel. We do a lot of events, and those attendees who have not yet subscribed will be given the offer to subscribe. And so, over time, that’s a great flywheel. Webinars and podcasts — the same thing. We also have a customer data platform on all of our websites, so that if you come to our website, we don’t know who you are. You can read three free articles. It’s gated after that. If you want to read more, you subscribe. You don’t have to pay, but you have to give us a certain amount of information. Now you’re a subscriber and if you qualify, we will add you as well. So it’s very sophisticated and for the most part it doesn’t cost a lot of money.

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Disclaimer  The views, thoughts and opinions expressed in this podcast are those of the hosts and guests and do not necessarily reflect the official policy or position of any organization, employer, or company they may be affiliated with. Covering the Spread is intended for informational and educational purposes only. While we explore topics such as design trends, industry practices, and future predictions, the content shared should not be interpreted as professional advice or a definitive guide. Listeners are encouraged to conduct their own research before making decisions related to magazine design, publishing or business strategy. We may reference or discuss third party content technologies or companies. These mentions are for context and commentary purposes and do not imply endorsement or affiliation unless explicitly stated. Additionally, given the ever-evolving nature of media and technology, some discussions may become outdated. We strive for accuracy, but we make no representations or warranties about the completeness or reliability of any information shared. Thanks for tuning in and enjoy the spread.

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Scott O. So these companies that are both the consumers, ostensibly of your magazines and the advertisers… If we run down the titles of some of the publications and properties that Annex works with, to the layperson’s ear, it sounds like some pretty specialized content. What are the natures of these companies? How big are they? Or do they run the gamut from mom-and-pop operations to multinational corporations?

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Scott J.  In both readership and in client base around marketing and advertising, they run the gamut of the Canadian and US economy and European economy in some ways, because we do have some international magazines, but we also have advertisers from around the world. So we have your John Deeres and Caterpillars that are advertising and reading, but we also have plumbing contractors that might only have two employees, including the owner. You look at your data set and it says, “President,” you could be the President of John Deere. That’s something. Or you could be the president of a plumbing company where you’re the only employee. Our average advertisers spend about $10,000-15,000 a year with us. So we have a lot. Our client base is over 7,000. And some of these people will run one $300 banner ad in a show guide with us once a year. And that’s it.

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Scott O.  So how do you tailor the content editorially to serve such a diverse audience?

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Scott J.  It goes back to having that audience data. The editors can look at the audience data set and get an understanding that, let’s say, if it’s our turf and rec magazine, 30% of your audience are landscape contractors, 30% golf course superintendents, 30% are municipalities, 10% are advertisers and suppliers. Well, you’ve got to have something for each of those groups in every issue. So you have to plan around that. In most of these industries, the issues are the same, regardless of your size. If it’s regulations, if it’s new technology, it’s just really a question of who can afford those investments. And so you have to keep that in mind. That hasn’t changed since I’ve been in this game. You need to know who your audience is — break it down by what their interest level might be in expensive technology, and then decide how much of that you’re going to cover. AI has made that a lot easier. We can put our data sets into code, for instance, and editors are doing this and saying, “Okay, tell me about my audience. Who are they? Who are in their groupings and who are the outliers?” It’s been surprising to some editors that they’ve got maybe, say, 15-20% of their audience — a group that they never considered writing content for. It creates a lot of opportunities, even for events. So I think we are positioned now to do a better job of that than we were before. Many of our magazines are so super niche that you’re really writing for one person — heating, plumbing, air conditioning. You’re writing for contractors. They might have 20 employees or 200 employees, but they’re all doing the same type of work. If you’re writing for Drainage Contractor, for instance, or Groundwater Canada, these are well diggers and their average age is 55. And so you’ve got very monolithic audience, but most of our audiences have two or three sets that we have to deal with.

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Scott O. How do you source subject matter experts for some of these very, very specific types of industries and interest groups?

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Scott J. That requires the editors, chiefly, and even some of the publishers, to be very active in their communities — to be going to all the events, regional events and national events, and making relationships with people, listening to speakers, talk at events or giving out webinars and having the intelligence to say, “Oh, this is a topic that’s important. And I met two experts at this event. Now I need to bring them into the fold.” That’s a job that never ends. For instance, in our firefighting magazine, a lot of the content is written by fire chiefs. But to get them to write for you, you have to do two things. You have to be out where they are, meeting them and gaining their trust. And then once they’ve submitted something, you have to edit it and fix it to the point where you make them look really good. And so it becomes something that they look forward to seeing their name in print. And that goes back to the value of print. It still means something to have an article in print with your name on it. If you’re an expert in your field — and we know this because people who tell us, “Well, we don’t want to do any advertising in print,” we’ll also say, “Here’s a great article we would like to work with you on.” And we’ll say, “Fine, put on the website.” “Oh, no, we’d really like to see it in print.” Well, you can’t have it both ways. Either it’s important or it’s not. And that’s a conversation we have all the time.

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Scott O.  Do any of the specialized magazines you publish have major competitors within that space?

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Scott J. The more niche, the less likely we are to have competitors. Of our 55 magazines. We have about 30 that have no competitors at all, which is rare and a very nice space to play in as long as you push yourself, because nothing pushes you like a competitor that beats you to a story. But some of our markets, like I mentioned — heating, plumbing and air conditioning — we probably have half a dozen competitors. Our aquaculture magazines are global, and the stack of competitors would probably be 30 magazines high. Our approach is to go very niche, and that narrows down the number of competitors you have. So we have a magazine on land-based aquaculture called RAStech, and that stands for Recirculating Aquaculture Systems. And we are the only one in that space. We have a large event that we run in the United States. We just ran it last week, actually. That is very profitable. And we are, again, the only one in that space. It’s so small that if you’re the first one, you’re likely to be the only.

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Scott O. So let’s talk about those events. How important is the print publication as an asset at an event like that for print publications?

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Scott J. I don’t see a direct link in terms of creating a successful event. It’s the basis for what we do in all of our markets in terms of credibility. If Canadian Forest Industries magazine comes out with an event, we have an immediate leg up on another person who comes out with an event that nobody’s heard of, in that our print magazine — the legacy of it, it’s 115 years old — gives us credibility that other people wouldn’t have in terms of marketing. And the importance of it, the media brand as a whole — and by that, I mean the digital side and the print — means we’re in front of our audience, potential audience, and potential exhibitors and sponsors 365 days a year. There was a big push pre-COVID by event companies, the larger ones, to get rid of all their media brands and be event-only. COVID was a wakeup call because now you don’t have any network, right? At the time, our event was maybe 12% of our revenue, so it hurt not to have it, but it wasn’t life-threatening. But the other thing, since COVID, is they’ve realized the advantage of having that constant dialogue and the data that comes with it to help you decide what to put on stage at your events. What are people interested in this year? When I look at companies or when we partner with companies that do events but don’t have media, I just look at: How do you even do this? How do you afford the promotion? It’s expensive to promote to niche audiences. For us, it’s just part of what we do as a means of connecting with what is, in many industries — apart from the ones that you serve — niche audiences and getting the most from them and getting the most to them.

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Scott O. A lot of these publishing entities that haven’t done events before are looking to start them up. So what advice would you have to a magazine brand or a publishing brand out there that wants to start going into the event business. How do they get started with that?

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Scott J. I think the first thing to do is to be willing to roll up your sleeves and do that first event on your own without having a lot of resources brought in, because a lot of the smaller magazines that we look at as an acquisition and who have events — they don’t feel comfortable running an event, which is fair enough. Everyone has to do it for the first time. And so they go out and they hire someone to do this event, or they have a contractor do the event, and there goes their margin. If you’re doing a niche event and you’re a niche publisher, you’re going to have a small event on a very specific topic. You have to be comfortable, having very low overhead for the first event or two. That’s how we started all of our events. Even though we had more resources our first two years in events, we had no event staff. The brand teams just figured it out themselves, learned from each other. Now we have six or seven event managers and directors and the full resource. We have an event marketing person, but in the old days we would just launch an event and figure it out. If you’re an independent publisher, I think that’s a necessity. You have to do that. And then the second thing I would suggest is working with the editors — find a topic that is very, very hot in your sector and then ask the question, “Are there potential advertisers and sponsors who also care about this topic?” You could have a topic like safety in your industry. That’s what your readers are really, really interested in, but you can’t make any money unless there are sponsors and exhibitors who are also interested in it. And what we found is safety is something that people love to talk about, but they won’t spend any money on it. In terms of marketing, you have to find where that overlap between reader interest and advertiser interest is, whatever that is. That’s where you want to hold your event.

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Louanne  What was your first event?

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Scott J.  Our first event that we launched was Grower Day in the greenhouse market. I think we just did our 30th one this year. When I first started in the company, we were holding it in the German Hall in Delhi [Ontario]. Imagine when you open your cottage for the first time in the year and it smells really, really musty. That’s German Hall smelled like. And we’ve served cabbage rolls for lunch because the ladies who run the German hall make excellent cabbage rolls. It was so tacky and low budget, but people loved the idea and the content, so we moved it to a professional venue and we started charging more. But that was our first event and still one of our most successful.

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Scott O.  What’s the most fun event?

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Scott J.  Manure Expo without a doubt.

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Louanne  Come on, it’s not chocolate?

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Scott J. Manure Expo. The tastiest is pizza. Our pizza events are the tastiest. Followed secondly, by the baking show, which is our biggest show by far. But Manure Expo is the one that we are famous for. I can’t go to a B2B media conference or trade show without somebody bringing it up — usually on the stage, not knowing that the publisher is there. We publish Manure Manager magazine. 80% of our readers and advertisers are in the Midwest, United States. So it’s one of our US brands, and the show is in the United States five years out of six. Next year, it’s back here in Canada for one year and it’s a live show. We build a live little mini-town every year. And they spray manure. They inject manure. They mix manure. They digest manure. The number one piece of advice before someone goes there: Don’t lick your lips.

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Scott O. Oh, God.

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Scott J. But it is a great event because it is so niche. Because who wants to do it right? Who wants to?

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Louanne  Okay. Well, yeah.

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Scott J. Yeah. Who wants to publish a magazine like that? So guess what — we own the market.

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Louanne  Oh, people probably love that smell.

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Scott J. Well, if you’re in that industry. I just got my start in the pulp and paper industry in Canada, and we used to call it the smell of money. And that’s the same thing in the manure industry. And we have a t-shirt contest where people send in their favorite slogans that they know we can’t officially use because they’re too crude or whatever. And then we create a t-shirt with the top ten on the back, and they sell out every year.

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Scott O. Oh, that’s great. What a great idea.

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Louanne  Awesome, I love it. You’ve acquired 27 magazines over the past 30 years. When you’re looking to evaluate a publication and acquire it, what, specifically, are you looking for besides the fact that they don’t have too many competitors?

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Scott J.  We look for revenue mix that we find is future looking or future-facing. We also look for people, staff. Are they going to fit our culture? And that’s important to us. We have a very unique ownership culture here. We are employee owned. The bar for how you treat your fellow employees and all of the admin staff is very high, and we have no tolerance for not meeting those standards. And so there’s no point in bringing people into our company who we know we’re going to have to throw out in six months. For those reasons, it’s not worth the risk. It’s also not worth what you inflict on other people in those six months.

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Scott O.  So how long has Annex been employee-owned?

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Scott J.  We have been employee owned since March of 2024. So just over two years prior to that, we had a very strong ownership culture, very transparent on financials. We had profit sharing. The evolution wasn’t shocking to anyone.

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Scott O.  What was the nature of the ownership of Annex before that?

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Scott J.  It was owned by a husband-and-wife team. They ran a newspaper business that they sold in 2004, and when they sold that, they really geared up the B2B side that became Annex. They were getting to the age where they wanted to retire. I was brought on as the CEO in 2019, and my main role was to try to sell the company, and we just didn’t find the right partner. Then COVID hit, and then the interest rates got out of whack. And so all of a sudden, a lot of private equity money dried up. And so we just came to the conclusion that this wasn’t for us, for many reasons.

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Scott O. How did you come to be in the position you’re in now?

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Scott J. I hung around longer than everybody else. I just wore people out. Um, so I was acquired. I owned three forestry magazines with three business partners, two in Quebec and one in Ontario. And we were acquired by Annex in 2004. And I signed a contract as part of the deal that I would stick around for two years to help with the transition. And I told the owners straight up, “In two years I will be gone. I’m going to start something new on my own.” I’m still here. So, you know, I think it’s because I had the varied background of owning a company. So you’re involved in all facets of the business. It was a natural transition, first to become a group publisher, and I had ten or twelve brands that I was running — a mini business inside Annex — but also a keen interest on where things were going in the future. So on the technology side, on automation side, efficiencies made the CEO role make sense.

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Scott O.  And what was your original job?

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Scott J. Editor.

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Scott O. Okay. So you have an editorial background.

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Scott J.  Yes. Editorial background up until 2009, and that’s when I moved to the dark side fully.

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Louanne  I think it’s interesting that your company has grown in differentiated itself. And in our previous conversation that we all had when we got to know each other, you mentioned something about the designers who may have been trained in print, are being retrained in digital. And instead of sending them off to pasture, so to speak, you’re keeping the talent and just retraining them so that they stay. You want the knowledge base and you don’t see that a lot. I think that it just really speaks volumes to how you treat your employees.

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Scott J.  One of the things about being an employee-owned company is your decisions are made with a different lens. And so we’re not in the business of putting people out of work because these are part owners of the company. Having said that, we were never in the business of putting people out of work. I remember one of the first things that I was asked to do as a publisher — when I started to get into the operations a little bit more, the previous owner asked me to look into design houses offshore and to see what the options were. We were a relatively unsophisticated company at the time. We had a lot of designers because we had a lot of magazines, and I was thinking, “This doesn’t make any sense to me. This is not who we are.” And he knew he wasn’t going to do it. He just wanted to be able to tell his banker or his partners or whatever. It didn’t make any sense. We got some pricing and everything, and first of all, we’re just as efficient. We just figured out how to scale it so we could be efficient while still having Canadian employees. Part of that is templating design, because if you’ve got 55 magazines, you don’t have to have 55 unique designs. The readers are different in every market. In terms of retraining media designers, it depends on the individual. They have to have a willingness to learn some new skills and an ability. We don’t have a perfect track record. They all work on digital projects. They’re designing digital ads for our events. And so there’s always a baseline. What we’re looking at now is, since we know the digital and events side and the webinar side is growing while the print side is shrinking, can we get somebody who was either a media designer or maybe a sales assistant on the print side interested and trained in running our webinar business? And it turns out we could. The success rate is pretty good. In fact, one of the things we’re doing with our structure in the coming month or two — and this is exclusive to you guys… brand new… even the employees don’t know this — is we’re going to be putting the digital and print production sides together under one person. So we get rid of that silo, and it will be that person’s responsibility to create the training grid where we’re moving these people, where we think the company is going. So it’s not a conflict between two departments. We’ve had numerous people from different sides of the business join our events team, because it’s growing quickly and requires knowledge of the business. And so it’s easier for us to train somebody to be an events person than it is to train someone about all of our unique processes as a business. You retain the good talent.

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Scott O. So without giving away too much of your trade secrets, how many titles would a typical editorial team be expected to be producing?

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Scott J.  That depends on the size of the magazine and the frequency and the number of special projects. If it’s got four events versus no events, things like that. But if we’ve got a larger brand that’s got a good revenue stream and maybe has won a bit, we’d have one editor that does that. That’s all they would do, and one salesperson that only does that. In other cases, we have some editors who are doing two or three of these ultra niche magazines that only come out once or twice a year. So they’ll do two or three of those, and a salesperson will do two or three of those and they’ll be the team. Otherwise, you couldn’t afford to put those magazines out. Some of these magazines might only drive $250,000 in revenue in a year. You can’t have a full-time editor, full-time sales staff. It’s got to be all shared services and shared duties.

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Louanne  What about the designers? How much do they take on?

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Scott J.  We have peak times of the year where that team is just going at 130%. That is typically fall and spring when we have a number of issues and typically bigger issues around shows in the summer. In the winter, sometimes we’re looking for things for them to do. Our event team has that same feast or famine, right? That’s the nature of our industry, I think, in general.

 

Louanne  One more question before I get into the big question. Is your team remote, hybrid or all in house?

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Scott J. Well, I can hardly think now that I’m waiting for the big question.

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Scott O.  So, am I. I’m scared.

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Scott J.  Yeah. Me too. And you don’t have to answer it. Before COVID, we were mostly in-office and we had some remote employees working in forestry or agriculture where they were in the Midwest or in British Columbia. Let’s say 95% of our people were in the office five days a week. Very early in COVID — as a backgrounder, we had far stricter restrictions in Canada than most of the United States, for all kinds of reasons that I won’t get into.

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Scott O.  It wouldn’t have been hard to be stricter than we were.

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Scott J.  We still argue about that in Canada, which is odd. Anyways, it doesn’t matter. We had to deal with them. So the first day of COVID, when we knew things were going sideways, everyone went home and we had to figure out how to do that with equipment. So we were buying a bunch of laptops, and it was very busy for a month or so. But we quickly learned there was no big deal, that there were some advantages to it as well in productivity. Instead of people driving two hours for a half-hour meeting, we just Zoomed it. But we also found that we missed a lot of what made Annex, Annex. So we spent about six months. And when I say, “We,” it was the management team: myself and our amazing VP of HR, and we brought in a couple of focus groups from employees. 15 in our south office and 15 in our Toronto office. And we all talked about what would the ideal look like when COVID was over, which was, of course, much longer than any of us anticipated. We called it work 4.0 because we didn’t want to call it “return to office,” because “return to office” is either negative or positive, but it’s not neutral. It wasn’t only going to be where we did the work, but how we did the work, what we had to invest in. Of course, we didn’t come back to the office until March of 2022, and we have not changed it since. And the result is we have two common days in the office — Tuesday and Wednesday — and three days in home offices. We are not “work from anywhere,” so you can’t go to Japan for a month and work there. I would say you would be hard pressed now to get anyone here, including me, to change that. It works extremely well. It works well for your personal life and it works well for your professional life. And I can’t for the life of me, except for trust issues, understand why you would want to go from that to “return to office” five days a week.

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Louanne  Okay. Are you ready for the big question?

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Scott J. Yeah. Terrified.

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Louanne  AI. So that’s not even a question anymore, right? But I call it the big question because, inevitably, we always end up talking about AI on our podcasts and everybody cringes or people are excited. It just kind of depends on who we talk to. So we talked about staffing and your company and your events. How much is AI cutting into any of these decisions, and do you feel like AI might reduce some of your workforce, or are you using AI to make your workforce more efficient or both?

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Scott J. I’ve been deep into AI for about three years, and I’ve gone through that whole cycle of “There’s nothing here. It’s not accurate. It’s useless,” to, “This will do everything for us. I can’t believe we don’t have more of this,” to where I am now, which is: It’s going to do some things, but there’s things we are not going to do with AI. And we decided what those are. I don’t see a direct link right now between AI and job reductions. Again, that’s not what the business we’re in anyway. I guess I can start first with what we’re not using AI for. We’ve had an AI policy — detailed policy, mostly for the editorial staff — for about three years now, two and a half years. Every quarter we update it because it changes that much, right? We do not use AI for any of the creative process. We do not use it for writing content. We don’t use it for laying anything out, designing anything. We’ve seen some horrible examples when staff send our production department a design that they made in Claude or whatever system they’re using, and want our production department just to clone it. And we’re going, “No, that’s not how this works. You don’t know anything about design. You’re an editor. Go back and write something and let us lay it out.” So we don’t use it in the creative process at all. And I don’t see that changing unless something changes dramatically. In contrast, we see it as a great moat for us on the creative process. We can create content, exclusive content, ultra niche content that we know actually searches very well with AI. That gives us an advantage. Right now we have proof of that. We even have products built around that ability for us to help you as an advertiser get discovered through our content on the process side. We use it a lot for analysis. I mentioned the example of the editors using it to dig into their audiences. I use it to stress test ideas or, for instance, I’m rejigging the executive team. And so I use it to challenge some of my assumptions, to give me some advice that I use judiciously. We use it for renewing our subscriptions because we’re audited. We have to do a certain amount of telemarketing that used to all be offshored, right? It is now all AI. If you get called as a reader of Canadian Forest Industries to renew your subscription, you probably won’t know it, but you’re talking to an AI agent, and we’ve been doing that for 18 months. We use it a lot in finance and in minerals, where we have two systems that don’t necessarily talk to each other yet. And instead of doing manual conversions — putting things on a spreadsheet and working with that — we have AI do that. It’s not saving us any employees. We’re using them for more valuable things like collection of our debt, which really moves the needle for our business.

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Scott O.  What about the industries you serve? Because they’re so specialized, in some cases, I wonder if that makes them more insulated than, perhaps, general interest topics are from AI, kind of polluting the water, as it were, in terms of what your editors or writers are looking for to report on.

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Scott J.  It’s made us rethink the content we produce. Not all of it, but it’s deprioritized some content and forced us to prioritize other types of content, even to the point where we’re hiring differently now. So as an example, part of our content on our e-news is curated news, aggregated news. It used to have some SEO value with Google. It now has zero value with AI and probably it’s a negative value. So we’re really de-prioritizing that. We’re going to produce less of it so that we have bandwidth to create original content. We’re already doing that. We’re going to produce more of it. And that means picking up the phone and interviewing someone. AI can’t do that: creating that unique content with a person’s voice in it and with a credible byline. And then we might use AI to create other things from that content, but we have the original content. So even the AI-modified content is still high-value. We know that search is very well even in the new Google. With the zero click, we are cited far more often than anyone else that we see. We have advertisers and PR agencies who are now all of a sudden very interested in working with us, because they also have learned in AI, you need a credible source. You need to be found in a credible location and we know we have that.

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Scott O. Scott, thank you so much for joining us. It’s been a pleasure having you. Can you tell our listeners how they can find Annex Business Media?

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Scott J. If you Google Annex Business Media, we will be at the top, I can guarantee you that. And our website is a wealth of information. We have a page that tells you about all of the brands, and they click directly to those websites so you can go deeper. Our next event, I believe, is in the greenhouse sector. And so like everything we do, it’s inside baseball. You either are fascinated and passionate about it or you don’t care. So probably none of your listeners will go to the greenhouse.