Christie Hefner became chairman of the board and CEO of her father Hugh's business, Playboy Enterprises, in 1988. Hefner never expected to end up in that role, nor did she view it as her life's work. She was born just before Playboy magazine, and lived with her mother after her parents split up when she was two. An English major at Brandeis University, she was Phi Beta Kappa and graduated summa cum laude with the intention of pursuing a career in journalism or law. But she took a job working for her dad as special assistant to the chairman of the board in 1975 and stayed, moving up to vice president after five years and president in 1982, before finally ascending to the top spot. Twenty years later, Hefner, 55, is attempting to navigate her company through a landscape changed radically by technologies unimaginable when Playboy was born. She spoke toMultichannel News contributor Stuart Miller last month. An edited transcript follows:
MCN: When you took over, did you envision staying for 20 years?
Christie Hefner: Candidly, no. When I first came to the company, I thought I'd just work here for a year or two and then go to law school. And even after I took over, I didn't think of it as a long-term plan. We were not doing very well then, and my focus was just to put the company on a solid footing. I'm not someone who has 10-year plans in life.
MCN: Did you view taking on the job as a business challenge or a chance to preserve and nurture a family legacy?
CH: It was all of a piece. I feel like I'm the steward of a great brand. I do treat it like a family business — if you do that, you take the long term views and then you'll make the right decision in the short term.
MCN: What are the biggest and the most surprising changes Playboy Enterprises and Playboy TV have undergone since 1988?
CH: The biggest changes are the ones in new technology that have been the major changes for all media. Fortunately, we were early believers in extending the brand — we were the first national magazine to go into television and in 1994 we were the first national magazine to go online.
Playboy TV is obviously in the process of navigating the changes in technology for delivery. We have started a subscription service, and [subscription video on demand] has done well with brands that cultivated a loyal audience. We are on the cusp of exciting opportunities.
Second would be the opening up of so many new markets internationally. We've got a global consumer products business, 25 editions of the magazine and Playboy TV in 100 countries.
Third is how popular the brand has become with women. I think it's a combination of things. But we have been helped by a generational change: Women are growing up as the beneficiaries of both the feminist movement and the sexual revolution and embracing both — they are very comfortable with their sexuality and see themselves as equal partners. At our company, over 40% of our executives are women.
MCN: Has the change come more quickly in the last 10 years with things like Internet, video on demand, HDTV, and will that pace continue or was this era unique?
CH: The rate of change has been accelerating. There is truth to the old adage that it is always overstated how quickly people will adapt to technological change, but it is always understated how profound the impact will be once they do.
The key for any mid-size entertainment company is to be fiscally prudent but creatively bold. Seventy percent of the next generation down believes the mobile phone is an entertainment device. I don't know what it means exactly yet for us but it will be a 'third screen' for programmers, consumers and advertisers. The changes will continue to be profound.
MCN: How has Playboy TV contributed to and possibly added to the Playboy brand? Is there any distinction between it and the magazine in terms of brand? And how has that brand changed over the last 10 or 20 years? CH: The Playboy brand is more popular than ever before. One of the keys to Playboy's enduring popularity is that it's as much an attitude and psychographic as anything else. We need to stay true to those brand attributes, which are all about the good life and sexiness and fun. But the more varied offers we can provide, with Playboy radio or online, the better, and each one can change to attract a new consumer.
The magazine needs to remain focused on its core audience — it is a men's magazine and needs to have its own voice — but Playboy TV was designed with an eye to an entertainment experience that couples would share.
The cable television brand was focused on more affluent couples, which is an appealing demographic and was an important expansion of the market for us. That's who is coming to our club in Las Vegas. The club brings our brand to life in an immersive experience, it can be a critical part of our success in terms of branding like the theme park piece of Disney. It promotes the idea of our lifestyle and gives people a chance to live it.
We do make the connection, whether with the magazine and with Playboy TV, and we are working to find more ways to cross-promote and integrate the different properties.
We are very careful in what we license and we are an active brand marketing partner, not a passive licensee. We have a large design team that creates style books four times a year. Any product has to be approved at concept but again when it comes off the factory line and before it goes into stores. We are very consistent now.
MCN: How important is the international market, and how is the brand perceived overseas?
CH: The core brand values are universal — the style, the sophistication, the sexiness — but the brand also stands for personal freedom and that now has a greater resonance outside the United States. It is part of the appeal of America as a cool place to be with a great lifestyle, but on a deeper level it is about America as a place you can be free.
When we launched a magazine in Russia after the Soviet Union broke up, we were told by someone, 'Now we really have freedom because we can read Solzhenitsyn and Playboy.'
Twenty years ago, I would not have thought we'd be doing business in China and we still don't have a Chinese language edition of the magazine, but licensees in Taiwan and Hong Kong have been exporting Playboy products there. I didn't think we'd do very well but I said, 'Okay, go ahead and try.' And now it is one of the biggest brands there.
We create content in other parts of the world and are truly a local partner. In Latin America we even launched a basic cable, ad-supported channel that focuses on the celebrities and nightlife. We try things like that in different parts of the world and then we say, 'Where else might it work.' We might even try something here.
MCN: How important are the other adult channels you own — Club Jenna, Spice Xcess, Fresh, and Shorteez — to the company's bottom line and to the brand? Even though they're not branded as Playboy, they do let you venture into racier fare.
CH: It is not a big part of our overall business, but it has made us more important to distributors. It is a totally different brand, though, just like BET and Showtime and Nickelodeon are all owned by Viacom. Playboy always has been and needs to be in a class by itself. It is very important we stay true to that.
MCN: What is your favorite Playboy TV show?
CH: My favorite is the new show, 69 Sexy Things to Do Before You Die — each episode takes a couple and follows them on an experience, like nude scuba diving. I enjoy it enormously.
Beyond Print And TV From the magazine that started it all to TV, radio and online, Playboy Enterprises understands the importance of having a multiplatform strategy.
“We do make the connection between properties whether with the magazine or with Playboy TV,” said CEO Christie Hefner. “And we are working to find more ways to cross-promote and integrate the different properties.”
Bob Meyers, president of media, said, “Our brand is unique in that we have this certain aura.” While he stressed that brand extensions and licensing opportunities must be carefully selected and well-coordinated, he added, “Our brand is very flexible and can be stretched in many ways.”
Indeed, the brand made famous by its pictures has even made a go of it on satellite radio.
According to Meyers, while many companies have a core business and treat branding and licensing projects as secondary, Playboy Enterprises has a different mentality. “No one thinks of any part here as an ancillary business,” he said. “Everything here is core.”
That explains why Hefner remains upbeat even when the magazine and the domestic TV sides have struggled. In the fourth quarter of 2007, online and mobile revenue increased even as other areas were lagging; and in the first quarter of 2008, the consumer products division and international TV continued to flourish even as much of the company took a hit.
Hefner said the company will invest even more in technology, marketing and content to drive growth in online and mobile in the near future.
“The key for any mid-size entertainment company is to be fiscally prudent but creatively bold,” she said.
“There are new platforms emerging all the time,” Meyers added. “Every day when I wake up some new device has been invented to change the way we deliver our product to the consumer. [Given that], a strong brand is really important. The trick for us is to keep the brand strong and relevant and to have our antenna up for these new opportunities. Then each has to be interpreted in the appropriate way.”
While “the magazine is the centerpiece of the brand,” Meyers said the magazine's persona is adjusted to fit each brand extenstion. “The Internet site does not just reflect the magazine's sensibility,” he said. “It wouldn't work if we just regurgitated content from another medium. It interprets that style sensibility of brand in a way that is appropriate for the Internet.”
Playboy.com provides links to other Playboy platforms, including the Cyber Club, video-on-demand content, Playboy gaming, Playboy TV's Web site and Playboy mobile. Hefner said the sites will undergo a “large redesign over the course of this year,” with one focal point being the building the social networking side of the site.
On the mobile front, Hefner said Playboy is still strategizing the best way to approach this “third screen.” “Seventy percent of the next generation down believes the mobile phone is an entertainment device,” she said.
Earlier this year, Playboy signed a deal with THQ Wireless to develop Playboy-branded lifestyle-themed mobile games, which will not have nudity. The first, Playboy Games: Pool Party debuts this summer.
Playboy is also extending its brand by borrowing a page from its past, resurrecting the famous Playboy Clubs. The clubs, which generated buzz and revenue in the 1960s, were losing money when Hefner shut them in 1986. But with this revival, the company is being careful not to spread too many around.
The first of the new Playboy Clubs opened in Las Vegas in 2006 at the Palms Casino Resort, and Jeff Georgino, senior vice president of location-based entertainment, said the club mixes retro with modern — archival magazine images along with plasma video screens. The Playboy Bunny logo is woven throughout, from the carpeting to the buttons on the sofas. “And, of course, beautiful Playboy Bunnies at the blackjack and roulette tables, and serving cocktails with the legendary Bunny Dip,” he said.
“The club brings our brand to life in an immersive experience,” Hefner added. “It promotes the idea of our lifestyle, and gives people a chance to live it.”
Next up is another club on the other side of the world: “Playboy Mansion Macao” will open in China at Macao Studio City. And Georgino said he is looking into other possible locations in Europe and Latin America.
The Las Vegas club opened just down the road from the first Playboy retail store in the United States. The licensing of retail merchandise has been perhaps the brightest star in the Playboy firmament in recent years showing consistent and strong growth, in America but especially in Europe and Asia.
“We are very careful in what we license and we are an active brand marketing partner, not a passive licensee,” Hefner said. “Any product has to be approved at concept but again when it comes off the factory line and before it goes into stores.”
The company now offers everything from Playboy video games (the Playboy: The Mansion game lets you be Hugh Hefner if you are so inclined) to sunglasses, swimsuits, lingerie and cosmetics.
Hefner said three-quarters of all Playboy merchandise sold is for women, especially internationally, where it is seen as the apex of sexiness and the good life. “Women understand we have a commitment to quality and to good taste,” she said.— Stuart Miller
For more on Playboy TV's 25th Anniversary, read MCN's Special Report and multichannel.com.