CAMPAIGN INTERNATIONAL: Silent and venerable German giant makes tentative steps to break out of familiar niche - Bauer has relied on women’s and TV listings titles for decades but it is changing, Anna Griffiths says

Heinrich Bauer is an ostensibly powerful but noticeably silent force in the European magazine market. Although undeniably influential in terms of circulation - accounting for almost a third of the consumer magazines sold in Germany, for example - Bauer appears to have nowhere near the clout or presence of its big European rivals.

Heinrich Bauer is an ostensibly powerful but noticeably silent

force in the European magazine market. Although undeniably influential

in terms of circulation - accounting for almost a third of the consumer

magazines sold in Germany, for example - Bauer appears to have nowhere

near the clout or presence of its big European rivals.



The reason, say its critics, is the reticence it has shown in breaking

out of its comfortable domination of the German women’s magazine and TV

listings market. Here, it accounts for just less than half of total

sales, but despite this dominance, Bauer takes second place to

Bertelsmann’s Gruner & Jahr in advertising revenue terms. And in Europe,

Bauer is even smaller fry. According to Zenith’s report on the 50 top

European media owners, it stands eighth in the media revenue rankings

after the likes of Reed Elsevier, Bertelsmann, Axel Springer and United

News & Media.



Yet this secretive, conservative, Hamburg-based group has a venerable

history in the publishing game. Founded in 1875 by Johanne Andreas

Ludolf Bauer, as a printer of ornately designed calling cards, it

expanded into regional free sheets in the late 1890s. By the time two

world wars had come and gone, however, Bauer had left news-papers behind

and begun to settle into its current niche - the low-priced, mass market

end of magazine publishing.



It was a formula that Bauer first brought to the UK in 1987, when -

along with the appearance of fellow German publisher, Gruner & Jahr -

the group helped shake up radically the weeklies market, challenging the

success of IPC which was, until then, unassailable in the same

market.



Indeed, Bauer still has designs on the UK market, as shown by its

last-minute bid for IPC last year. Bauer’s offer was referred to the

Office of Fair Trading but, before it went any further, the German

publisher was pipped to the post by the venture capital company, CinVen,

which backed a management buyout.



Bauer obviously has cash to spare; a company spokesman has told

Campaign: ’If further opportunities for international engagement present

themselves in the future, we will most certainly examine these very

carefully.’ But if the company is interested in any magazine or company,

it is equally adamant that it would never buy into anything unless it

could be owned wholly.



According to the Bauer spokesman: ’We prefer to be alone in the house,

bear all responsibility and risks ourselves and also enjoy our successes

alone.’



However, when it comes to media outside magazines, Bauer is not a total

control freak. It has taken tentative steps into such areas as

television and radio such as its 32 per cent stake in the private TV

station, RTL2, sharing ownership with CLT and TeleMun-chen. It also owns

a significant chunk of the north German pop music station, Radio Ham-

burg, and just less than half of the film and TV production company,

MME.



Bauer has also sought to exploit the success of its magazines through

online initiatives, launching interactive sites for Autozeitung, Kochen

& Geniessen, TV Movie, Selbst ist der Mann, Bauidee, Praline and

Wochenend.



On the print front, it has been more adventurous, expanding into France,

Spain, the US, Hungary and Poland as well as the UK. It stepped up its

presence in Poland last September by establishing a printing plant in

Ciechanow for its 12 Polish titles as well as its Czech and Hungarian

magazines. Bauer is also keen to print other publishers’ magazines from

the plant.



At home, although Bauer is the major player in consumer magazines, it is

facing a tough market for its weekly programme guides as fortnightly

titles increase in popularity. During 1996 Bauer was also forced into a

price war sparked by Gruner & Jahr’s price reduction on TV Today. The

experience caused Bauer to lose three percentage points off its share of

the listings market to 48 per cent and resulted in a dip in its

circulation revenue through reduced cover prices.



One long-cherished ambition Bauer has yet to realise is a launch into

the lucrative and prestigious news magazine market. The essentially

regional nature of most German newspapers means that this sector is

where the real influence in the country lies, and Bauer has been seeking

to break into news weeklies since 1994.



That was the year it announced the launch of a title called Feuer.

However, the launch was delayed and, by February 1996, Bauer, which had

spent millions of pounds developing the title - now called Ergo -

decided that the market was beyond its reach.



Established players such as Der Spiegel and Focus were performing too

well and could not be shouldered aside. This year Bauer finally dipped a

toe into financial waters with a new, accessible fortnightly business

magazine, GELDidee. However, news and current affairs are currently off

the agenda.



As far as future plans go, there are no surprises in store. Bauer will

continue to concentrate on its core competencies of TV listings, women’s

and youth magazines.



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