The New (Old) Playboy
How Scott Flanders changed the iconic magazine to avoid closing the doors to Hef's mansion for good.
Now, with the magazine and the mansion on his back, Flanders needed to figure out another way to turn a profit, and time was running out. So he turned to what had always worked for him in the past. “[My best ideas] don’t come to me when I’m at the office,” he says. “I’ll get on the stationary bike and not even put on headphones, and as monotonous as that may seem, there’s something about it that frees my mind for kind of random connections. I’d say that’s when I do my most inspired thinking.” A former marathoner, Flanders is a self-professed exercise enthusiast. “The most fascinating thing about Scott is that he’s got this tremendous sense of work–life balance,” says Kristin Patrick, Playboy’s chief marketing officer. “He makes it a point to work out every day, and encourages all of us to do that, too.”
Flanders soon hit on the realization that, while Playboy’s consumer licensing business was far more profitable than its media properties, it accounted for just 13% of the company’s business model. Seeing his opening, he began selling off chunks of the media operation and focusing on partnerships to develop the licensing model. “It was clear to me that we needed partners who could operate those businesses more efficiently and effectively than we could,” he says. And with that decision, everything began to fall into place.
Three years later, from an operations standpoint, Playboy was a new company. “When I came in, the media business was around 87%, and consumer licensing was about 13% of the business model,” Flanders says. “In the third quarter of 2012, licensing was 74%. of our business.” And who’s driving the majority of those profits? Women—a discovery that led to a partnership with cosmetic giant Coty that, since the fall of 2009, has built Playboy an astounding $200 million bath-and-beauty business. On the apparel front, bringing in agency powerhouse IMG has caused profits to multiply tenfold in China alone; and Flanders has even bigger plans for Asia this year.
The kicker is that Playboy is now doing with a lean 165-person staff what it couldn’t do three years ago with an organization almost four times the size. And by bringing all the personnel together in a swank, new Beverly Hills office—and taking the company private for the first time since the ’70s—Flanders has brought Playboy back full circle, returning it to its debonair roots without sacrificing the magazine, the mansion, or the integrity of the brand.
Financially, Flanders’ mission has been a success: One year after his hiring, Playboy had gone from a deficit to a $10 million profit, and in 2012 the company quadrupled that. Flanders has preserved an iconic piece of Americana for the next generation. Now we’ll all have to wait a little longer to find out how the story ends.