High Art

Don Reeve, a wealthy magazine publisher with a reputation for turning round magazines, has purchased High Art, an international magazine of contemporary art and culture which has declining circulation. The magazine is published in New York eight times a year (annual subscription $75) and appeals mainly to those involved in collecting contemporary art. The magazine features reviews of contemporary art exhibitions from an insider perspective, as well as book reviews, auction activity, and columns by today's most forward-thinking writers, artists and curators.

The look and editorial coverage have already been transformed by the new owner to reflect the desired new market position of the magazine which emphasises art as an investment.

A spokesperson for Don Reeve stated: "High Art, along with other arts magazines, has struggled to maintain circulation in recent times. We know that the readership of arts magazines is declining generally, but we think we can buck the trend with our new format magazine. In fact, we believe the contemporary art investor segment has the potential to grow tremendously over the next few years, both in terms of magazine readership, as more people get into collecting art for investment purposes, and in terms of advertising, where we have the ability to deliver an audience to advertisers interested in reaching high net-worth readers. High Art is set to become a highly valuable and unique resource that provides the information and opinions that contemporary art investors need to successfully navigate the art market and make informed investment decisions."

The magazine is distributed through independent newsagents and select galleries in the UK, USA, Canada, France, Germany, Portugal, Italy, Belgium, Japan, Australia and New Zealand.

Required:

(i) Do you think Don Reeve is wise to invest in High Art at a time when readership of arts magazines is declining? Explain your reasoning. (10 marks)

(ii) Advise Don Reeve on the development of a