Building on a Good Name; 'Information Franchise' Builds Profits for Institutional Investor, but Requires Diligence and Commitment

Article excerpt

Building on a good name

Sponsoring a conference or two, or publishing a newsletter, is currently par for the course among many established business magazines. But Institutional Investor, owned by Capital Cities/ABC, Inc., New York City, has been one of the most successful in developing an "information franchise' on its good name--a nest of newsletters, conferences, directories and research products that currently accounts for 40 percent of the company's revenues.

Louis B. Dotti Jr., executive vice president at Institutional Investor, says the company thinks of itself, not as a publishing business, but as a toll business. "We figure out how to charge a toll so that buyers and sellers can communicate with each other,' he says. In this case, that means asking the same people who subscribe to Institutional Investor to subscribe to newsletters, attend meetings and conferences, or join Institutional Investor membership organizations.

The magazine itself celebrated its 20th anniversary in June. Its current circulation of 100,000, controlled, is up 250 percent from two years ago. Some 20 percent of readers pay $165 annual subscription fees. The international edition has a circulation of 30,000.

According to founder and chairman Gilbert Kaplan, Institutional Investor was launched as "the flagship around which we would build many other information products.' In time, the magazine's reputation lent the credibility essential to launching II's information products. These include:

Newsletters. Six weekly newsletters expand on topics covered by the feature-oriented monthly magazine. Each covers spot news in a specific area, such as banking, money management and Wall Street, and each has an independent staff of journalists. Annual subscriptions cost $1,275 to $1,500, and recent newsletters have carried advertisements, such as investment offerings. Kaplan believes that any publisher with a monthly trade magazine should be able to generate a weekly newsletter to cover news in that field.

Conferences. Twenty to 30 conferences and seminars around the world are sponsored annually by Institutional Investor. Many, funded by perhaps a dozen corporate sponsors, are by invitation only to qualified prospects. Others are open-attendance conferences or smaller, industry or job-specific meetings. Kaplan says between 50 and 75 employees work full-time on conferences.

Professional journals. The Journal of Portfolio Management, a quarterly launched in 1974, is the model for a new division that publishes quarterlies, semiannuals, annuals and one-shots on narrow investment subjects in banking, corporate finance and other areas. The division's first project is The Money Management Forum, a one-shot scheduled for November publication. Depending on test response, the new division may roll some projects into higher-frequency publications. The journals will be written by academics and practitioners, rather than journalists.

Institutional Investor Institute. More than 100 leading investment institutions pay annual dues to an organization that conducts research and sponsors regular meetings on topics of common concern. …