Germany: Special Report - The global face of a German giant

The international face of Axel Springer tells Mark Tungate why it took so long to expand overseas.

Andreas Wiele, the president of magazines and international at Axel Springer, is also responsible for the publisher's forays into digital, a fact his business card omits. "Perhaps there wasn't room," he says.

The company only recently started expanding beyond Europe where, since the mid-90s, it has been carving a publishing empire that includes notable successes in Central Europe.

Oddly for a former New York resident, Wiele is relaxed as he talks about the company and its plans to expand.

Could you tell me a little bit about yourself? What makes you uniquely qualified to head the international division of Axel Springer?

I wouldn't say I'm uniquely qualified. I've been on the board of Axel Springer since 2000. From 1994 until then, I was in New York as the chief operating officer of the magazine arm of Bertelsmann, Gruner & Jahr. Before that, I spent four years in Paris with Gruner & Jahr as the publisher of the French editions of Capital and Geo. And before moving into management I was a journalist.

Should I move into management?

If I were you I'd stay in journalism. You guys get to do all the fun stuff.

Right. Looking at Axel Springer's performance in Germany, I see dailies circulations have fallen in line with a global trend. Are readership patterns changing there - are mags affected?

Readership patterns of both newspapers and magazines are changing and will continue to do so, but more slowly than most people think. Remember, Bill Gates predicted we would have paperless offices by 2000. Circulations may not increase, but they will remain strong for some time to come, if publishers provide compelling products. Apart from free newspapers, a fairly recent phenomenon, the press is still the only media product that consumers perceive as "better paid for". Unlike TV, radio or the internet, many are still willing to pay for a good newspaper or magazine.

When did the company's international expansion strategy begin?

International expansion began rather late. This was linked to the death of the company's founder in 1985 (when the group was the subject of a prolonged and ultimately unsuccessful takeover bid by Leo Kirch and Burda) and the other is that newspaper publishers started to internationalise later than magazine publishers. But we have made up for lost time. In 1998, more than 2 per cent of our sales came from overseas, while eight years later that figure had risen to 15 per cent.

Your website suggests you don't have any products in the UK. Why?

As our expansion began late, we decided not to move into markets where there was already a great deal of competition. Instead, we focused our efforts on Central and Eastern Europe, and we are now reaping the rewards of that strategy. By the way, in the UK we license Auto Bild to Dennis Publishing under the title Auto Express, so we are not entirely absent from the market.

You are extremely strong in Poland where you've just launched the quality daily Dziennik. I'm surprised there was a gap in the newspaper market for it.

We found before the launch that total newspaper sales were 2.3 million for a population of 40 million. This was despite Poland's well-developed infrastructure of 75,000 newsstands, roughly twice France's number, and on a per capita basis, equal to Germany's. We could also measure the success of Fakt, a tabloid newspaper that we launched in 2003 and which now sells 500,000 copies, making it the best-selling newspaper in Poland.

In launching Dziennik, we were up against one newspaper that was half-owned by the government, Rzeczpospolita, and another with historical links to the Solidarity political party, Gazeta Wyborcza. In other words, we saw there was certainly room for a modern, independent quality newspaper that borrowed many elements from British products.

How has Dziennik performed since its launch in April?

We expected to sell 150,000 copies a day and we are selling more than 200,000. This makes the paper the third-largest in the market. If you also take into account our total newspaper sales, we have a 44 per cent share in the national dailies market.

You are also the digital strategist at Axel Springer. Do you think publishers should be investing less in traditional media and more in online and mobile?

Both. Publishers should play to their strengths and keep developing compelling print products. But they should also link them to relevant digital offerings. We recently bought a price-search engine. This links very well to Computer Bild, which is all about testing products for consumers. Now, when readers have worked out which product they want to buy, they can go online and look for the best price.

The tabloid newspaper Bild is, of course, a highly successful media brand. In Germany you've successfully expanded into other areas. What are the brand values of Bild?

The first magazine derivative of Bild appeared 23 years ago. In the meantime, Bild der Frau has become the leading women's weekly in Germany. Since then, there has been Sport Bild, Auto Bild, Computer Bild. Overall the Bild titles reach 43 per cent of the adult population in Germany ... and we have managed to license these products to other markets overseas.

The word Bild means "picture". It seems obvious now, but back in the 50s, Axel Springer was the first publisher to realise that newspaper readers didn't only want to read about what was going on, they wanted to see it. Bild products have always been accessible and affordable.

Apart from that, they have always been on the side of the consumer. Very often, magazine content is geared towards the advertisers, but the philosophy of Bild is to serve its readers first.

I heard you'd like to launch a Bild-style tabloid in Paris. Are the French ready for a genuine downmarket tabloid - their first? What's your view?

We need to decide, and consider the tone and the style of the product. Let's just say it's still at the research stage.

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