Playboy Comeback Bets on Women, Wellness and Maybe Sports Betting

By Christiana Sciaudone

Investing.com -- This is not your uncle's Playboy. 

The iconic brand is making a comeback, going public via a special purpose acquisition company and reinventing itself as a pleasure and lifestyle consumer platform for all, focused on everything from sexual wellness to, potentially, online sports betting. 

"Everything that makes you look good and feel good," as Chief Executive Officer Ben Kohn put it in a recent video interview. The company has been best-known for its magazine, which stopped publishing earlier this year.

To help get it there, Playboy agreed to merge with Mountain Crest Acquisition Corp, a Spac, in a $415 million deal that's scheduled to close in early 2021. That will set the company up to fund acquisitions and expand.

Kohn said the company is already growing on its own, with sales expected to increase 68% year over year. The key to that growth has been capturing younger generations and transforming the brand from its lascivious origins to one that appeals to the current generation.

"Over 85% of our audience today is under the age of 44," Kohn said. "We've grown the female audience by 70%."

Future acquisitions will be focused on the $250 billion sexual wellness industry, think: condoms, or the expansion of businesses like its recently released line of CBD bedroom products aimed at women. It's offering more than just stuff to buy, too. Playboy wants to provide advice and education. 

"How do we help people have better sex lives?" said Chief Brand and Strategy Officer Rachel Webber in the same interview. "That's how we're thinking about it."

Recently, the company rolled out a three-part class about the orgasm gap with Allbodies, an online health education company. Some 3,000 people signed up for the first class, without any marketing.

"It's such a sign that there's a need in the marketplace," Kohn said.

The company is ready to use its brand recognition to expand into new places and businesses.

The Playboy bunny has always had a close association with casinos, and online sports betting could be a new frontier for the company.

"Historically, this brand has worked very well in sports; I can't announce anything that's imminent," Kohn said, playing coy. "It's not like it's not on our radar."

Also on the radar, in a major way, is the Chinese market, where Kohn says Playboy is the leading men's fashion brand. Not far behind China is India, where Playboy will launch its first legitimate consumer products later this year. 

While the Playboy brand is obviously highly recognizable, it's working to shed its old reputation as an adult magazine full of sexy centerfolds and the occasional edgy interview or article. Playboy's staff is now 50% female, and almost the entire editorial staff consists of women. They also have women behind the camera, and the subjects of the photographs are intimately involved in the shoots.

"At its core, it's about free expression, sexual freedoms," Weber said. It's "about really creating a platform for people to own their sexuality."       

Still, it will take a long time to shed its salacious past, Kohn said. The brand, however, is powerful. Playboy ranks as the 21st on the annual Top 150 Global Licensors report, which ranks the retail sales of licensed merchandise from the world's most powerful brands, spanning all consumer product segments. That's ahead of Pokemon and Ferrari (NYSE:RACE).

"The advantage of this company is that you can't replicate it," Kohn said.