Inside Immediate Media’s BBC Good Food acquisition

Immediate Media, publisher of titles including Top Gear and Radio Times, has strengthened its food portfolio with the acquisition of BBC Good Food from BBC Studios this week, with an eye toward growing revenue opportunities beyond advertising.

The 40-odd staff from Good Food will move over to Immediate Media’s offices in the coming weeks and will create a group to house the other food titles under its portfolio. Immediate said it does not plan any staff cuts as part of the deal.

BBC Good Food brings with it a strong events arm: BBC Good Food Show. These regular roadshows with the U.K.’s top chefs, tastings, shopping and entertainment, attract 300,000 visitors who spend £27 million ($35 million) at the Shows, according to event organizers, River Street Events. BBC Good Food also has a popular Amazon Alexa recipe skill which will enhance Immediate’s opportunities in the audio space.

Immediate has diverse revenue streams across the portfolio through affiliate links, selling bikes and TV shopping businesses tied to its craft magazines. The opportunities for Good Food brand extensions through selling kitchenware to TV cookery shows are ample.

“We’ve grown fast when other publishers from a magazine heritage have not had an easy time of it. Our success is that we’re laser focussed on special-interest communities,” Immediate Media CEO Tom Bureau said. “There are wars on consumer attention and if you focus on the stuff people love doing you have a strong strategic platform for growth. In a large market, there’s huge commercial opportunity.”

This marks Immediate Media’s sixth significant acquisition since 2011 as part of the company’s focus on passion areas. Immediate has nearly 80 special-interest titles under its stable including wedding magazine Hitched, Cycling News and Simply Knitting. Specialist titles may not be the most flashy, but they are strong profit drivers during otherwise turbulent times for media.

“Under Immediate Good Food will be able to commercialize its reach more effectively,” said Alex DeGroote, an independent media analyst. “Mature magazine companies [like Immediate Media and Future] are very profitable. Immediate Media loves solid, unglamorous titles in secure market positions. There are few competitive threats and the demographic is skewed to the older reader. Special-interest brands typically have high subscriptions and low churn.”

According to the Auditing Bureau of Circulations, BBC Good Food has a monthly subscription circulation of over 200,000. As Digiday has previously reported, a subscription-focused business can command a price eight to 12 times its earnings, while an ad-supported business might fetch a price four to seven times.

According to Similar Web stats, BBC Good Food has 18 million monthly unique visitors on desktop and mobile, with around 85 percent of traffic coming from search, and ranks 14th in the world for the food and drink category. In the food and drink category, Immediate Media already has recipe and review title Olive, which has just shy of 1 million monthly unique visitors on desktop and mobile, according to Similar Web.

In 2011 Immediate Media licensed a number of magazines from BBC Studios, the commercial arm of the BBC, including BBC Gardeners’ World and Top Gear so has sold the ads for Good Food for years. According to Douglas McCabe, CEO at Enders Analysis, the transition of BBC Good Food under the Immediate umbrella has been a long time coming. “It’s a great brand — in print, online and as a live event — and understandable that BBC Studios would want to hang on to it, but in the end Immediate Media provides a more natural home.”

In 2017, BBC Studios made £157 million ($203 million) in profit. BBC Good Food might be an iconic title but its numbers are tiny compared to BBC Studio production revenues, DeGroote points out.

The investment indicates an increased confidence in the industry, said Liz Duff, head of media and investment at media agency Total Media. “Does it indicate that the return to context is gathering pace, and is being reflected in ad revenues? A brand safe environment with great content will surely be of interest to advertisers, and the move is one that agencies will welcome,” she said.

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