{"id":16026,"date":"2016-11-18T03:08:44","date_gmt":"2016-11-18T08:08:44","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/the-naked-truth\/"},"modified":"2016-11-18T03:08:44","modified_gmt":"2016-11-18T08:08:44","slug":"playboy-the-naked-truth","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/playboy-the-naked-truth\/","title":{"rendered":"Playboy: The Naked Truth"},"content":{"rendered":"

Before you get your panties in a twist…<\/strong><\/em><\/span><\/p>\n

Consider this: pornography\u00a0has been shown to accelerate, and even dictate, the adoption of technologies. Look to the 1980s, and we see VHS winning out over Betamax as the format for video tapping. Why? The longer recording times of VHS made it the porn industry standard, and with overwhelming volume flowing out of adult entertainment, media mavens were forced to follow suit. [1]<\/p>\n

\"blu-ray_hd_dvd_war\"<\/a><\/p>\n

Again in the mid-2000s, the National Association of Broadcasts discussed\u00a0“several major players in the porn industry going the Blu-Ray route” over HD-DVDs, ultimately convincing mainstream players to invest in the Blu-Ray format. [2] Business Insider even goes so far as to say that the internet itself “would not have found a solid consumer base without porn.”<\/strong> [3] The whole internet?! Owes its success to porn?!\u00a0Now that’s a panty dropper.<\/em><\/p>\n

 <\/p>\n

The internet is such a tease: stripping away profits, one click at a time…<\/strong><\/em><\/span><\/p>\n

As much as porn has driven technology innovation, the digital revolution has caused issues for the industry and many companies have struggled to adapt as free porn floods the internet. In 2006, the internet saw double digit growth, already outpacing spending in more traditional businesses like magazines by nearly three times.<\/p>\n

\"2016-11-17\"<\/a>
Excerpt from 性视界 Professor Edelman’s research [4]<\/figcaption><\/figure>It’s\u00a0evident from industry insiders that the internet has become\u00a0the dominant channel for adult entertainment; in 2013, the\u00a0CEO of Takedown Piracy gave a sense of scale for internet porn\u00a0stating, “We’ve submitted 6.5 million URLs [with pirated material] to Google. Financially, piracy has killed the adult movie industry.”\u00a0[5]<\/p>\n

Can the internet really take down\u00a0an institution like\u00a0Playboy though?<\/strong><\/em><\/span><\/p>\n

Um…yes.<\/p>\n

The NY Times notes, “Pornographic magazines, even those as storied as Playboy, have lost their shock value,
\ntheir commercial value and their cultural relevance.” [6] Playboy’s business model banked on the elusiveness\u00a0of \"read-it-for-the-articles\"<\/a>naked photos, but flashlights under the sheets have been replaced by the glow of iPhones where porn is on-demand, free, and easily accessible.<\/p>\n

Playboy magazine’s circulation dropped\u00a0from 5.6 million in 1975 to 3 million in 2006 and 0.82 million in 2015. [7] Banking on the adage that men buy Playboy for the articles, the magazine dropped nudity from its website and magazine in 2014 and 2015 respectively. This business model shift to top-notch journalism with artistic photos provided access to social media\u00a0(which bans sexually explicit content) and additional advertisers, but also edged Playboy into a competitive space with elite brands like The New Yorker<\/em>. [8]<\/p>\n

\"playboy-now\"<\/a>
Playboy Now mobile app (playboy.com)<\/figcaption><\/figure>\n

Playboy’s operating model has expanded beyond the core of publishing magazines; the company now positions playboy.com as “sexy and safe-for-work,” offers iPlayboy for access to every issue of the magazine ever, gives Playboy bunnies Instagram feeds, and pushes\u00a0a mobile app, Playboy Now, to allow readership across digital channels. [9]<\/p>\n

Adding to its business and operating model over the last ten years, Playboy also pursued\u00a0subscription porn sites like Playboy TV and acquired hardcore porn sites, such as Club Jenna in 2006.\u00a0[10]<\/p>\n

Here’s the sad part of the story: free porn is still winning. <\/strong><\/em><\/span><\/p>\n

Despite the business model and operational updates seeking to leverage digital solutions, Playboy is still losing ~$6M per year\u00a0and is up for sale for $500M with no potential buyers. [11] While the non-nudity rebranding quadrupled its website unique users per month to 16 million, over half of Playboy’s money\u00a0comes from licensing its brand. [12]<\/p>\n

Can we save the bunnies?<\/strong><\/em><\/span><\/p>\n

Playboy is having a full-on identity crisis. Capitalizing on the brand for subscriptions to hardcore porn sites while attempting to shift the magazine to\u00a0work-appropriate editorial content makes it near impossible for Playboy to disassociate with its erotic image and attract new customer segments to its website, mobile app, and social media. People looking for porn are going to find it for free; people looking for great journalism have plenty of established options that don’t require excuses when the website is open on their computers.<\/p>\n

But they still have one edge – the bunnies. Playboy needs to divest its subscription hardcore porn businesses \"kate-moss-2014\"<\/a>and return to its 1950s pinup girl roots with a clear and consistent brand message matching their non-nudity move. Then, they need to aggressively manage their bunny brand and expand merchandising, perhaps limiting licensing over time to control product quality. Finally, they need to find their Marilyn Monroe of the 21st century and create a Playboy bunny social media supermodel to keep the brand relevant and cool. Playboy can use these steps to position themselves as a classier, gender-neutral\u00a0Cosmo<\/em> magazine, providing the potential to retain male readers while attracting women who want to feel sexy (but not slutty). In the age of #freeporn, Playboy needs to leverage its iconic heritage and go back to basics to win in this digital revolution.<\/p>\n

[Word count: 798]<\/p>\n

Sources<\/em><\/span><\/p>\n

[1] Johnson, Peter (1996). \u201cPornography Drives Technology: Why Not to Censor the Internet.\u201d Federal Communications Law Journal, 49(1): 217\u201326. <http:\/\/www.repository.law.indiana.edu\/cgi\/viewcontent.cgi?article=1120&context=fcl><\/p>\n

[2] Mearian, Lucas. \u201cPorn Industry May Decide Battle between Blu-Ray, HD-DVD.\u201d Macworld, 2 May 2006. <http:\/\/www.macworld.com\/article\/1050627\/storage\/pornhd.html>.<\/p>\n

[3] Benes, Ross. “PORN: The hidden engine that drives innovation in tech.” Business Insider<\/em>, 5 Jul 2013. <http:\/\/www.businessinsider.com\/how-porn-drives-innovation-in-tech-2013-7><\/p>\n

[4] Edelman, Benjamin (2009). “Red light states: who buys online adult entertainment?”\u00a0Journal of Economic Perspectives, 23(1): 209\u2013220. <\/em><http:\/\/people.hbs.edu\/bedelman\/papers\/redlightstates.pdf><\/p>\n

[5] Breslin, Susannah. “The business of porn.”\u00a0Forbes<\/em> online, 21 Jan 2013. <http:\/\/www.forbes.com\/sites\/susannahbreslin\/2013\/01\/21\/the-business-of-porn\/#379d071859b2><\/p>\n

[6] Somaiya, Ravi.\u00a0“Nudes are old news at Playboy.” The New York Times<\/em> online,\u00a012 Oct 2015. <http:\/\/www.nytimes.com\/2015\/10\/13\/business\/media\/nudes-are-old-news-at-playboy.html?_r=0><\/p>\n

[7]\u00a0Chemi, Eric. “Playboy magazine, by the numbers.” CNBC<\/em> online, 11 Dec 2015. <http:\/\/www.cnbc.com\/2015\/12\/11\/playboy-magazine-by-the-numbers.html><\/p>\n

[8] Powell, Neil. “The real reason Playboy is getting rid of nude pics.”\u00a0Fortune\u00a0<\/em>online, 17 Oct 2015. <http:\/\/fortune.com\/2015\/10\/17\/playboy-stops-nude-photos\/><\/p>\n

[9] Company website. Accessed 16 Nov 2016. <http:\/\/www.playboyenterprises.com\/playboy-content\/><\/p>\n

[10] Spain, William. “Playboy gets more hardcore with new acquision.” Marketwatch, 22 June 2006. <http:\/\/www.marketwatch.com\/story\/playboy-goes-for-more-hardcore-with-new-acquisition><\/p>\n

[11] Helmore, Edward. “Playboy business on sale for $500m – but is there still money in the bunny?” The Guardian<\/em>, 2 Apr 2016. <https:\/\/www.theguardian.com\/us-news\/2016\/apr\/02\/playboy-business-sale-future><\/p>\n

[12]\u00a0Somaiya, Ravi.\u00a0“Nudes are old news at Playboy.” The New York Times<\/em> online,\u00a012 Oct 2015. <http:\/\/www.nytimes.com\/2015\/10\/13\/business\/media\/nudes-are-old-news-at-playboy.html?_r=0><\/p>\n","protected":false},"excerpt":{"rendered":"

*gasp* yep, I'm talking about porn… bear with me while I bare all about the industry we like to pretend doesn't exist.<\/p>\n","protected":false},"author":2077,"featured_media":16730,"comment_status":"open","ping_status":"closed","template":"","categories":[2287,2285,2286,2283],"class_list":["post-16026","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-adult-entertainment","category-hugh-hefner","category-playboy","category-taboo-industries"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/digitization-challenge-2016\/","yoast_head":"\nPlayboy: The Naked Truth - Technology and Operations Management<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/playboy-the-naked-truth\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Playboy: The Naked Truth - 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