Reorienting Business Tokyo; after a U.S. relaunch, the title is growing ancillary products and converting circulation to paid

Folio: The Magazine for Magazine Management, Dec 1, 1991 by Liz Horton

The story, apocryphal or not, goes like this; The future minister of international trade and industry of Japan and the chairman of Keizaikai Co., which publishes three Japanese-language business magazines in Japan, were standing on the observation deck of the Empire State Building discussing their dreams for the future. The first said his dream was to become a cabinet minister.

Seichu Sato's was to produce a top-quality English-language magazine offering an insider's view to outsiders doing business with the Japanese.

The story is part of the corporate tore of Business Tokyo, and is frequently repeated to the New York City staff when its Tokyo-based publisher, Peter Fuchs, visits. It is intended to underline Keizaikai's commitment to building a more and more successful magazine.

The original Business Tokyo was based in Tokyo and covered the ins and outs of doing business with Japan from a worldwide perspective, distributing a total of 25,000 copies across 29 different countries. But to reach the magazine's potential, the parent company decided it had to refocus exclusively on the U.S.-based business executive. In October 1989, Business Tokyo resurfaced in New York City sporting a new look designed by Milton Glaser and Walter Bernard.

Two years into its relaunch, fiveyear-old Business Tokyo has built its qualified controlled circulation to 120,000 executives of small- and medium-size American companies interested in taking advantage of Japan's economic growth.

And now, having mastered its Tokyo/New York commute and solidified its editorial positioning, the magazine is planning to convert its circulation to paid and is beginning to expand its franchise with a plethora of databases, cassettes and seminars.

"Our initial emphasis was on producing a prestigious editorial product," specifically addressing U.S. executives, says associate publisher Andy Fowler, a former West Pointer and journalist. Fluent in Japanese, Fowler moved with the magazine from Japan to New York in july 1989. He began handling new business development as business manager barely a year after relocating and became associate publisher in january 1991.

The ties with Tokyo remain tight. Stories are generally outlined by U.S. editors familiar with American businesspeople's concerns. Then a bilingual research and reporting staff, based in Japan, write the stories in English. The articles are edited stateside and sent into production by the New York staff. The process is eased by a sophisticated electronic publishing operation that includes a well-used electronic mail link with Tokyo.

Conversion: A tough sell?

The editorial part of the equation is in place now, says Fowler, and the company is readying step two of its strategy: converting its controlled circulation to paid. Business Tokyo's strategy has been to gather a large and highly qualified written request profile of top people at its target firms, then somersault that audience into paid subscribers.

A million-piece direct-mail drop following the relaunch bumped circulation to 100,000 by March 1990, says Fowler. Current American qualified circulation is just over 121,000, according to the June 1991 Business Publications Audit of Circulation (BPA) statement, with 91 percent controlled and 9 percent paid (a one-year subscription to the monthly costs $48). An additional unaudited 16,000 copies go to Japan, says Fowler.

The speed of the transition to paid circulation depends on the results of tests currently under way, Fowler says, but it definitely won't be an overnight move. First to be asked to pay are likely to be less desirable subscribers, or ones who didn't fill out the entire reader request form and so don't qualify for inclusion in the BPA audit (a small part of total circulation). Business Tokyo will also continue looking for new paid subscribers through direct-mail and blow-in and bind-in cards in magazines distributed in East Coast and West Coast airline shuttle flights, at co-sponsored conferences, and through newsstand sales.

There's precedent for very successful moves from controlled to paid, says publishing consultant David Foster- "look at Inc. " -but it can be risky. "You have to make sure you have sufficient market penetration to continue to deliver a circulation your advertisers want. You're going to cut the advertising heart out if you monkey around with delivering inferior quality circulation." And you have to be sure the publication has become so indispensable that readers will pay for it. "The fact of the matter is, you've trained your readership to get it without having to pay, and it's very hard to break that mentality," notes Foster.

One way to make your magazine essential, he suggests, is to increase the information flow by adding directories, newsletters, and other information streams-and charge for these products. Upping the ancillaries In fact, ancillary services for Business Tokyo readers are already a big part of Fowler's strategy. Six months ago, using the magazine as a flagship, Business Tokyo launched a database with Rye, New York-based International Business Network. A $50 enrollment fee, plus $30 per hour on-line fees, gives readers access via computer to a calendar of trade events going several years into the future, a library of Business Tokyo materials-how to get in touch with companies that manufacture products covered in the magazine, for instance-and global listings that provide thousands of trade leads. For an additional $3, readers can download a profile of the lead they're interested in. One new project is a forum in which readers can ask questions on Japanese business topics to host consultants-a resource that will also help editors keep in touch with their readers' concerns. is the database profitable yet? "It's a long-term new business development," hedges Fowler.