In this Annual Report on Form 10-K, the terms “we,” “us,” “our,” “MSO” and the “Company” refer to Martha Stewart Living Omnimedia, Inc. and, unless the context requires otherwise, Martha Stewart Living Omnimedia LLC (“MSLO LLC”), the legal entity that, prior to October 22, 1999, operated many of the businesses we now operate, and their respective subsidiaries.

 

FORWARD-LOOKING STATEMENTS

 

All statements in this Annual Report on Form 10-K, except to the extent describing historical facts, are “forward-looking statements,” as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent our current beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of our control. These statements often can be identified by terminology such as “may,” “will,” “should,” “could,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “potential” or “continue” or the negative of these terms or other comparable terminology. Our actual results may differ materially from those projected in these statements, and factors that could cause such differences include those factors discussed in “Risk Factors” as detailed in Item 1A of this Annual Report on Form 10-K, as well as other factors, including those discussed in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Forward-looking statements herein speak only as of the date of filing of this Annual Report on Form 10-K. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our reports to the Securities and Exchange Commission.

PART I

Item 1.   Business.

 

We are an integrated media and merchandising company providing consumers with inspiring lifestyle content and well-designed, high-quality products. The company is comprised of four business segments: Publishing, Merchandising, Internet and Broadcasting, a combination that enables us to cross-promote our content and products.

 

Our growth strategy is three-pronged:

 

As part of our brand acquisition strategy, we recently announced our agreement to acquire all the assets related to Chef Emeril Lagasse’s businesses, other than his restaurants and corporate office (subject to certain closing conditions), in exchange for approximately $45 million in cash and $5 million in our Class A Common Stock and an additional payment of up to $20 million based upon the achievement of certain operating metrics in 2011 and 2012.

 

The media and merchandise we create generally encompasses eight core areas:

 

As of March 10, 2008, we had approximately 760 employees. Our revenues from foreign sources were $12.3 million, $15.6 million and $9.3 million in 2007, 2006 and 2005, respectively. Substantially all of our assets are located within the United States.

 

Martha Stewart published her first book, Entertaining , in 1982. Over the next eight years she became a well-known authority on the domestic arts, authoring eight more books on a variety of our core content areas. In 1991, Time Publishing Ventures, Inc. (“TPV”), a subsidiary of Time Inc., launched Martha Stewart Living magazine with Ms. Stewart serving as its editor-in-chief. In 1993, TPV began producing a weekly television program, Living , hosted by Ms. Stewart. In 1995, TPV launched a mail-order catalog, Martha by Mail , which made available products featured in, or developed in connection with, the magazine and television program. In late 1996 and early 1997, a series of transactions occurred resulting in MSLO LLC acquiring substantially all Martha Stewart-related businesses. Ms. Stewart was the majority owner of MSLO LLC; TPV retained a small equity interest in the business. On October 22, 1999, MSLO LLC merged into MSO, then a wholly owned subsidiary of MSLO LLC. Immediately following the merger, we consummated an initial public offering.

 

BUSINESS SEGMENTS

 

Our four business segments are described below. Additional financial information relating to these segments may be found in Note 15 to our Consolidated Financial Statements.

 

In 2007, our Publishing segment accounted for 56% of our total revenues, consisting of operations related to magazine and book production. Revenues from magazine advertising and circulation represented approximately 58% and 39%, respectively, of the segment’s revenues in 2007.

 

Magazines

 

Martha Stewart Living.  Our flagship magazine, Martha Stewart Living , is the foundation of our publishing business. Launched in 1991 as a quarterly publication with a circulation of 250,000, we currently publish Martha Stewart Living on a monthly basis with a rate base of 2 million, effective January 1, 2008. The magazine appeals primarily to the college-educated woman between the ages of 25 and 54 who owns her principal residence. Martha Stewart Living offers lifestyle ideas and original how-to information in a highly visual, upscale editorial environment. The magazine has won numerous prestigious industry awards and generates a substantial majority of our magazine revenues, primarily from advertising revenue.

 

Everyday Food.  We launched Everyday Food in September of 2003 after publishing four test issues. This digest-sized magazine featuring quick, easy recipes was created for the supermarket shopper and the everyday cook. Everyday Food targets women ages 25 to 49, and is intended to broaden our consumer audience while developing a new brand and diversifying our revenue.

 

Martha Stewart Weddings.  We launched Martha Stewart Weddings in 1994, originally as an annual publication. In 1997, it went to semi-annual publication and became a quarterly in 1999. Martha Stewart Weddings targets the upscale bride and serves as an important vehicle for introducing young women to our brands. Martha Stewart Weddings is distributed primarily through newsstands.

Body + Soul.  In August 2004, we acquired certain assets and liabilities of Body + Soul magazine and Dr. Andrew Weil’s Self Healing newsletter (“Body & Soul Group”), which are publications featuring “natural living” content. The magazine generates both advertising and circulation revenue, while the newsletter generates substantially all of its revenue from subscriptions. Body & Soul Group also sells a limited line of merchandise related to “natural living,” which we record as publishing revenue attributed to Body + Soul .

 

Blueprint: Design Your Life.  In 2006, we began testing a new magazine called Blueprint: Design Your Life . Geared to women ages 25-39, Blueprint targeted a different demographic than our core consumer, while maintaining our distinctive “how-to” approach, covering home, fashion, and beauty. After two test issues in 2006 and six in 2007, we decided to discontinue publishing the title on a stand-alone basis after the January/February 2008 issue.

 

 

Special Interest Publications.  In addition to our periodic magazines, we publish certain special interest magazine editions. We began with one in 1998 and published nine in 2007. Our Special Interest Publications provide in-depth advice and ideas around a particular topic in one of our core content areas, allowing us to leverage our distribution network to generate additional revenues. Our Special Interest Publications can be sponsored by a single advertiser, multiple advertisers, or contain no advertising; and may be sold at newsstands and/or distributed to subscribers with issues of Martha Stewart Living . In 2007, we published Good Things for the Kitchen, Martha Stewart Living: Outdoor Living, Good Things for Kids, Good Things for the Home, Martha Stewart Holiday: Halloween, Everyday Food Holiday Baking and three Body + Soul specials.

 

Magazine Production, Distribution and Fulfillment.  We print most of our domestic magazines under agreements with R. R. Donnelly and currently purchase paper through an agreement with Time Inc. While paper for use in our magazines is widely available, volatility in the paper market is currently applying upward pressure on paper prices. We also expect to see a mid-year 2008 increase in postage expense. We use no other significant raw materials in our businesses. Newsstand distribution of the magazines is handled by Time Warner Retail, an affiliate of Time Inc., under a more favorable, revised agreement that expires with the December 2010 issue of Martha Stewart Living . We expect that prices charged for distribution through national wholesalers will increase in 2008. Subscription fulfillment services for our magazines are provided by Time Customer Services, another affiliate of Time Inc., under an agreement that expires in June 2014.

Books

 

In the second quarter of 2007, we announced a multi-year agreement with Clarkson Potter/Publishers to publish 10 books beginning with Martha Stewart Living Cookbook Volume I: The Original Classics; Martha Stewart Living Cookbook Volume II: The New Classics; and Martha Stewart’s Wedding Cakes . In the fourth quarter of 2007, we signed an amendment to the agreement with Clarkson Potter to deliver an additional two books for a total of 12 books to be published over multiple years. In addition to these 2007 titles, we have produced over 60 books including the recent best-sellers: Martha Stewart’s Homekeeping Handbook: The Essential Guide to Caring for Everything in Your Home; Everyday Food: Great Food Fast; and Martha Stewart’s Baking Handbook .

 

Competition

 

Publishing is a highly competitive business. Our magazines, books and related publishing products compete with other mass media and many other types of leisure-time activities. Competition for advertising dollars in magazine operations is primarily based on advertising rates as well as editorial and aesthetic quality, the desirability of the magazine’s demographic, reader response to advertisers’ products and services and the effectiveness of the advertising sales staff. Martha Stewart Living competes for readers and advertising dollars with women’s service, decorating, cooking and lifestyle magazines and websites. Everyday Food competes for readers and advertising dollars with women’s service and cooking magazines and websites. Martha Stewart Weddings competes for readers and advertising dollars primarily in the wedding service magazine category and websites. Body + Soul competes for readers and advertising dollars primarily with women’s lifestyle and natural living magazines and websites. Our Special Interest Publications can compete with a variety of magazines depending on the focus of the particular issue.

 

Seasonality

 

Our Publishing segment can experience fluctuations in quarterly performance due principally to publication schedule variations from year to year, timing of direct mail expenses, delivery schedule of our long-term book contract, and other seasonal factors. Martha Stewart Weddings was published five times in 2007: three issues in the second quarter and two issues in the fourth quarter. Additionally, the publication schedule for our Special Interest Publications can vary and lead to quarterly fluctuations in the Publishing segment’s results.

 

Our Merchandising segment contributed 26% of our total revenues in 2007. The segment consists of operations relating to the design of merchandise and related packaging, promotional and advertising materials, and the licensing of various proprietary trademarks, in connection with retail programs conducted through a number of retailers and manufacturers. Pursuant to agreements with our retail and manufacturing partners, we are typically responsible for the design of all merchandise and/or related packaging, signage, advertising and promotional materials. Our retail partners source the products through a manufacturer base and are mostly responsible for the promotion of the product. Our licensing partners source and/or produce the branded products together with other lines they make or sell. Our licensing agreements require us to maintain no inventory and incur no meaningful expenses other than employee compensation.

 

Licensed Retail Partnerships

 

Martha Stewart Everyday at Kmart and Sears Canada

 

Martha Stewart Everyday is our mass-market brand. Currently, the label is associated with products that generally fall into the following categories: Home (which includes sheets, towels, pillows, bath accessories, window treatments and kitchen textiles); Garden (which includes outdoor furniture and accessories); Kitchen

(which includes cookware, bakeware, utensils, dinnerware, flatware, and beverageware); Keeping (which includes organizational products relating to the pantry, closet and laundry); Decorating (which includes mirrors, picture frames, candles, and lamps); Ready-to-Assemble furniture (living, dining, bath and bedroom furniture); and Holiday (which includes artificial Christmas trees, decorating products, wrapping and ornaments).

 

In the United States and Canada, all of these products are sold under exclusive agreements. In the United States we have an exclusive license agreement with Kmart Corporation in the mass-market channel. In 2007, Kmart represented 76% of total revenues in our Merchandising segment and 21% of total Company revenues due principally to the contractual minimum guarantee (see “Management’s Discussion and Analysis – Executive Summary” for details regarding our contract with Kmart). In Canada, we have an exclusive license agreement with Sears Canada, which launched the Martha Stewart Everyday brand label in September 2003.

 

We own the Martha Stewart Everyday trademark and generally retain all intellectual property rights related to the designs of merchandise, packaging, signage and collateral materials developed for the various programs.

 

Martha Stewart Collection at Macy’s

 

In September 2007, we launched the Martha Stewart Collection exclusively at Macy’s. The Martha Stewart Collection line encompasses a broad range of home goods, including bed and bath textiles, housewares, casual dinnerware, flatware and glassware, cookware, holiday decorating and trim-a-tree items. We own the Martha Stewart Collection trademark and generally retain all intellectual property rights related to the designs of the merchandise, packaging, signage and collateral materials developed for the various programs.

 

Martha Stewart at Costco

 

In December 2007, we introduced our first product as part of an agreement with Costco to sell prepared food co-branded with Costco’s private label brand, Kirkland Signature. Our soups began selling in January 2008, and we anticipate launching a series of fresh, refrigerated and frozen food products throughout the year.

 

Martha Stewart Colors at Lowe’s

 

In 2007, we launched a Martha Stewart-branded interior and exterior paint palette program called Martha Stewart Colors . The palette is available exclusively at Lowe’s stores in the United States and Canada.

 

Martha Stewart Flowers with 1-800-Flowers

 

In 2007, we announced our partnership with 1-800-Flowers to create an exclusive, new, co-branded floral, plant and gift-basket program beginning in 2008. This licensing agreement will provide an opportunity to participate in the same-day delivery of the flowers market.

 

Digital Photography Products

 

In 2006, we began a two-year agreement with Kodak Imaging Network to develop a line of branded Martha Stewart personalized photo products. The product line includes cards, calendars (non-branded), photo-books and stickers. In 2007, we partnered with Shutterfly to offer Martha Stewart-branded photo-books and cards, although the parties will be phasing out this relationship during 2008. The financial results from the sales of these digital products were reported in the Internet segment through December 31, 2007. In 2008, the digital photography product business will be managed and reported in the Merchandising segment as a licensed retail partnership.

Licensed Manufacturing Partnerships

 

Martha Stewart Crafts

 

In May 2007, we launched Martha Stewart Crafts products at over 900 Michael’s stores, and in August 2007, pursuant to our licensing relationship with EK Success, LTD and GTCR Golder Rauner, LLC, began distributing product to certain independent craft stores across the United States. In August 2007, we invested $10.0 million in an entity primarily funded by GTCR Golder Rauner that acquired Wilton Industries, Inc. and Dimensions Holding, LLC. The investment gives us a 3.8% ownership interest in the holding company of the new, combined entity, Wilton Products, Inc, which already owned EK Success. We also have a subordinated equity interest of 7.25% in the holding company of Wilton Products, the market value of which is contingent on reaching specific performance hurdles. In addition to our existing licensing relationship with EK Success, we also entered into a new licensing agreement with Wilton Industries. Through this arrangement, we will broaden our footprint in the crafts market by introducing licensed products in the following categories: food crafts; party favors; and weddings.

 

Martha Stewart Furniture with Bernhardt

 

We have had a Martha Stewart furniture program with the Bernhardt Furniture Company since 2003 and renewed that relationship at the end of 2007. Currently, merchandise produced under this relationship includes furniture for the living room, bedroom, and dining room, that is sold at furniture and department stores nationwide, including certain Macy’s stores.

 

KB Home / Martha Stewart Homes

 

In October 2005, we entered into an agreement with KB Home, Inc. to design and style all interior and exterior components for 655 new homes in Cary, North Carolina. In February 2006, we announced an expanded agreement with KB, pursuant to which we are collaborating with KB on new home communities throughout the United States. As part of the expanded agreement, we also offer a range of design options, featured exclusively in KB Studios nationwide. In December 2007, we amended the terms of our relationship in the initial contract, accepting a one-time payment in exchange for certain promotional obligations.

 

Martha Stewart Fine China for Waterford Wedgwood

 

In January 2007, we announced a worldwide agreement with Waterford Wedgwood USA, Inc. to develop a fine china and crystal collection. The line launched in January 2008 exclusively at Macy’s in the United States, and through macys.com, as part of the Martha Stewart Collection assortment of products.

 

Martha Stewart Lighting

 

In September 2007, we launched our Martha Stewart Lighting program through our agreement with Generation Brands, LLC, a manufacturer of leading brands of lighting. Our lighting and ceiling fans are available through independent lighting and furniture dealers.

 

Martha Stewart Area Rugs

 

In January 2007, we introduced our line of rugs through a licensing agreement with Safavieh, Inc., a leading manufacturer and importer of fine rugs. The Martha Stewart Rugs are sold at independent furniture and rug galleries and at certain Macy’s stores.

Martha Stewart Carpet Tiles for FLOR

 

In July 2007, we introduced our Martha Stewart Floor Designs with FLOR, Inc., an eco-friendly manufacturer of residential, high-style modular floor coverings. FLOR manufactures the Martha Stewart–branded carpet tiles and sells direct to consumers as well as to retailers.

 

 

Competition

 

The retail business is highly competitive and the principal competition for all of our merchandising lines consists of competitors in the mass-market and department stores in which our Merchandising segment products are sold, including Wal-Mart, Target, Kohl’s, JCPenney, Bed Bath & Beyond, Linens ’n Things, Home Depot, BJ’s and Sam’s Club as well as other products in the respective product categories. Competitive factors include numbers and locations of stores, brand awareness and price. We also compete with the Internet businesses of these stores and other websites that sell similar retail goods. Competition in our flower business includes other online sellers as well as traditional floral retailers. Competition in our digital photo products business consists of other Kodak and Shutterfly digital products, as well as products in competing online photo sites.

Seasonality

 

Revenues from the Merchandising segment can vary significantly from quarter to quarter due to new product launches and the seasonality of certain product lines. In addition, we historically recognize a substantial portion of the revenue resulting from the difference between the minimum royalty amount under the Kmart contract and royalties paid on actual sales in the fourth quarter of each year, when the amount can be determined.

 

Our Internet segment represented 6% of our total revenues in 2007, resulting from three revenue streams: online ad sales primarily at marthastewart.com ; product sales of Martha Stewart Flowers ; and sales of digital photo products. In 2008, revenue from the Internet segment will be advertising driven, as sales of flowers and digital products will be managed and reported by our Merchandising segment.

 

In August 2004, we chose to discontinue Martha By Mail and its online product offerings, which historically had been included in the Internet segment. The last catalog was mailed in the fourth quarter of 2004, with all remaining inventory disposed of in early 2005.

 

Marthastewart.com

 

The marthastewart.com website offers recipes and how-to content, integrated across the Martha Stewart brands in the following categories: food, entertaining, holidays, home and decorating, crafts, gardening, weddings, kids and health. In 2007, we relaunched the site with a new, more user-friendly platform. The site relaunch and subsequent releases included the development of advanced search, community tools, and the creation of “most popular” modules which showcase our inspirational content and beautiful imagery. Advertising is the primary source of revenue for our site.

 

Martha Stewart Flowers

 

Originally launched in 1999 as marthasflowers.com , the new website marthastewartflowers.com continued to operate under the business model of providing fresh floral products shipped directly from farms to consumers. This business model enables customers to ship floral gifts overnight, delivering Martha Stewart–inspired designs with superior freshness. Product categories include grower’s bunches, mixed bouquets, blooming plants, fresh wreaths and garlands. In 2007, we chose to partner with 1-800-Flowers to create an exclusive, new, co-branded floral, plant and gift-basket program beginning in 2008. This new, higher-margin licensing agreement will provide an opportunity to participate in the same-day delivery of the fresh flowers market. Martha Stewart Flowers , under this new agreement, will be managed and reported in the Merchandising segment in 2008 as a licensed retail partnership.

 

Digital Photo Products

 

In 2006, we began a two-year agreement with Kodak Imaging Network to develop a line of branded Martha Stewart personalized photo products. The product line includes cards, calendars (non-branded), photo-books and stickers. In 2007, we partnered with Shutterfly to offer Martha Stewart-branded photo-books and cards, although the parties will be phasing out this relationship during 2008. Our agreements with Kodak and Shutterfly provide for royalty payments based upon product sales. The agreement with Kodak also had a minimum guarantee which was completely recognized in 2006 and 2007. In 2008, the digital photo product business will be managed and reported in the Merchandising segment as a licensed retail partnership.

Competition

 

The online ad sales and flower businesses are highly competitive. Marthastewart.com competes with other how-to, food and lifestyle websites. Our challenge is to attract and retain users through an easy-to-use and content-relevant website. Competition for advertising revenue is based on the number of unique users we attract each month, the demographic profile of that audience and the number of pages they view on our site.

 

Seasonality

 

Revenues from our Internet segment can vary significantly from quarter to quarter. Advertising revenue on marthastewart.com is tied to traffic among other key factors and is typically highest in the fourth quarter of the year due to high advertiser demand to reach our audience demographic with their marketing messages, while revenue for Martha Stewart Flowers is tied to key holidays during the year.

 

Our Broadcasting business segment accounted for 12% of our total revenues in 2007. The segment consists of operations relating to the production of television programming, the domestic and international distribution of our library of programming in existing and repurposed formats, and the operations of our satellite radio channel. We generally own the copyrights for all content we produce for our television and satellite radio programs.

 

In September 2005, we launched The Martha Stewart Show  – a syndicated daily lifestyle series hosted by Martha Stewart – which generates the majority of the segment’s revenue. Filmed in front of a studio audience, the show consists of several segments, each featuring inspiring ideas and new projects from one or several of our core content areas. NBC Universal Domestic Television Distribution distributes the program domestically. In 2007, we announced that a fourth season of The Martha Stewart Show is expected to begin in September 2008. Because seasons run twelve months beginning and ending in the middle of September, the 2007 results include a large portion of season 2 and the first 16 weeks of season 3, which is currently airing in syndication. The Broadcasting segment previously produced the Living show, which ceased airing in September 2004. Revenues for The Martha Stewart Show currently are mostly comprised of advertising and product placement.

 

In November 2005, we launched the Martha Stewart Living Radio channel on SIRIUS Satellite Radio. Our channel provides programming designed for women listeners and their families, 24 hours a day, seven days a week. Under the terms of the four-year agreement, we receive a fixed revenue stream earned evenly over the life of the contract, with the potential for additional amounts based on certain subscriber and advertising based targets.

 

Everyday Food , a half-hour original series inspired by the magazine of the same name, airs weekly on PBS stations nationwide. Unlike revenues for The Martha Stewart Show, revenues for the Everyday Food series are provided by underwriters. In 2008, we added a spin-off companion show, Everyday Baking from Everyday Food , which also airs weekly on PBS stations.

 

In 2007, we announced several agreements with Scripps-owned networks including the primetime rebroadcast of The Martha Stewart Show on the Fine Living channel on a one-day delay from the initial syndicated broadcast. We also have a new series, Martha Stewart Crafts , currently airing daily on the DIY channel, which is a “best of” compilation from the former Living show, featuring how-to crafting segments.

 

We began to offer, in October 2007, access to 10 hours of segments from our library of programming through an advertising-supported, free video-on-demand service. Martha Stewart On Demand is currently available to Comcast and Cox digital cable customers and is updated monthly with 50% refreshed content.

Competition

 

Broadcasting is a highly competitive business. Our television programs compete directly for viewers, distribution and/or advertising dollars with other lifestyle and how-to television programs, as well as with general programming on other television stations and all other competing forms of media. Overall competitive factors in this segment include programming content, quality and distribution as well as the demographic appeal of the programming. As in publishing, competition for television and radio advertising dollars is based primarily on advertising rates, audience size and demographic composition, viewer response to advertisers’ products and services and effectiveness of the advertising sales staff. While the revenue from our radio business is contractually guaranteed, we compete for listeners with similarly themed programming on both satellite and terrestrial radio.

 

We use multiple trademarks to distinguish our brands, including Martha Stewart Living , Martha Stewart Everyday , Martha Stewart Collection , Everyday Food , Martha Stewart Weddings , marthastewart.com, Martha Stewart Flowers, Body + Soul and wholeliving.com . These and numerous other trademarks are the subject of registrations and pending applications filed by us for use with a variety of products and other content, both domestically and internationally, and we continue to expand our worldwide usage and registration of related trademarks. We file copyrights regarding our proprietary designs and editorial content on a regular basis. We regard our rights in and to our trademarks and materials as valuable assets in the marketing of our products and vigorously seek to protect them against infringement and denigration by third parties. We own and license the rights to many of these marks pursuant to an agreement between us and Ms. Stewart, which is described under Item 13 of this Annual Report on Form 10-K.

 

Our website can be found on the Internet at www.marthastewart.com . We have adopted a code of ethics applicable to our directors, officers (including our principal executive officer, principal financial and accounting officer and controller and persons performing similar functions) and employees, known as the Code of Business Conduct and Ethics. The Code of Business Conduct and Ethics is available on our website www.marthastewart.com and as Exhibit 14.1. Our proxy statements, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as certain of our other filings with the Securities and Exchange Commission (the “SEC”), can be viewed and downloaded free of charge as soon as reasonably practicable after they have been filed with the SEC by accessing marthastewart.com and clicking on Investor Relations and SEC Filings. Please note that information on, or that can be accessed through, our website is not deemed “filed” with the SEC and is not to be incorporated by reference into any of our filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

Item 1A.  Risk Factors

 

A wide range of factors could materially affect our performance. In addition to the factors affecting specific business operations identified in connection with the description of these operations and the financial results of these operations elsewhere in this report, the following factors, among others, could adversely affect our operations:

 

Our success depends in part on the popularity of our brands and the reputation and popularity of our founder, Martha Stewart, and any adverse reactions to publicity relating to Ms. Stewart, or the loss of her services, could adversely affect our revenues, results of operations and our ability to maintain or generate a consumer base.

 

While we believe there has been significant consumer acceptance for our products as stand-alone brands, the image, reputation, popularity and talent of Martha Stewart remain important factors. Ms. Stewart’s efforts,