Thomas O. Ryder, chairman and CEO of The Reader’s Digest Association Inc., Pleasantville, NY, yesterday outlined a growth strategy for the troubled company in a speech to financial analysts–and many of the measures have to do with its direct marketing operations.
Ryder, who arrived at the company from American Express last April, said Reader’s Digest will develop new channels. It has already expanded its DRTV efforts, which focus on its Reader’s Digest magazine. Reader’s Digest is also testing non-sweepstakes direct mail. “We were missing many people who like our products, but are not interested in sweepstakes,” Ryder said.
The company will expand its presence in home, health, family, finance and faith, starting with the first two. In financial services, it will focus on insurance and credit cards, possibly offering co-branded cards.
Reader’s Digest is also considering entry into product categories in which it could capitalize on its brand strength and direct marketing skills, including the direct mail pharmaceuticals and vitamins business. It is talking with potential partners and acquisition candidates and could enter the market in its fiscal year 2000.
In merchandise, the company’s efforts will build on the recently acquired Good Catalog Co., which it said will expand from its current nine catalogs.
Reader’s Digest will also focus on life-stage marketing, continue geographic expansion and make the Internet an integral part of its business, in part by making $100 million in strategic investments in Web sites.
Ryder said the company has an investment pool of $300 million and no debt.
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