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MEXICO CITY-At first glance, introducing a newspaper in a city where at least 25 dailies are on sale seems pure folly-even if it's the largest city in the world.

But it made sense to Alejandro Junco de la Vega, the publisher of Reforma, which, only two months after its startup, boasted the fourth-highest number of ad pages for all major Mexico City papers. During December through Jan. 27, Reforma racked up 855 pages of advertising (excluding classified pages).

Published by Consorcio Interamericana de Comunicacion and the sister paper of the Junco family's Monterrey daily, El Norte, the new paper-unlike most in Mexico City-does not rely on government advertising to break even. Instead, Reforma has built a reputation for independence.

Many of the capital's two dozen newspapers would fold without government ad support, a situation that creates a symbiotic relationship between publishers and the government and compromises objective reporting.

Now, Mr. Junco has brought El Norte's style to the capital. "The other newspapers [have had] to go on the alert," said Ignacio Sanchez Cid, a professor of journalism at the National Autonomous University of Mexico.

Since Reforma's startup Nov. 20 the paper has already racked up 7,800 paid subscriptions, growing at a rate of 26% a month, Mr. Junco said. Its ad page performance was even more remarkable considering that overall newspaper ad pages for the last quarter of 1993 were down 10.6% in major Mexico City papers-by about 3,000-said Patricia Ford, a partner at Sistemas para Edicion Electronica, an independent print ad monitoring company.

Still, Reforma needed more than just its sister newspaper's reputation to sell here. The paper prepared readers for its arrival with a teaser campaign that began two months before publication. Designed in-house, the campaign consisted of 40 billboards and 150 banners posted along key roads bearing nothing more than a large letter "O" with a picture inside of Mexico City's most famous monument, the Angel of Independence. The Angel, high atop a pillar, dominates the vista of the city's main thoroughfare, Paseo de la Reforma.

In October, the banners and outdoor boards were replaced with new ones bearing just the word "Forma" and the Angel drawing. Then, a day before the paper's debut, the full logotype went up, bearing the word Reforma, the Angel drawing and the paper's slogan, "Heart of Mexico" as it now appears on the masthead.

"I calculate that the average motorist in Mexico City sees one of my posters four times a day," said Jose Luis Grosvenor, Reforma's advertising and marketing manager. Reforma execs wouldn't discuss the ad budget.

But even by its startup date, the newspaper had not explained what in fact Reforma was so "we had to close the circle," Mr. Grosvenor said. Eighty thousand free copies were distributed in key restaurants, hotels and airports during the first week.

Now the company is offering free eight-week subscriptions on a "floating" basis in different Mexico City areas to 20,300 readers to boost sales beyond the 12,000 newsstand distributions.

The goal, Mr. Junco has said, is to double the initial print run of 30,000 paid subscriptions by the end of 1994 through both newsstand sales and retail outlets.

Aside from a lively layout, strong graphics and evenhanded reporting, the newspaper also has several other features aimed at winning readers. The daily enticed many of the city's most prominent columnists away from their own papers with generous contracts. Reforma is also emphasizing local news. Its 12-page "Ciudad," or City, section includes pages on crime and ecology and a full-page color pollution map, showing the previous day's ozone levels throughout the city.

Banks and airlines have been the first to sign on for page ads at a $5,815 cost in the weekday section, slightly less than competitor Excelsior, one of the most widely read and influential papers here, although bulky and old-fashioned. Excelsior, which claims a print run of more than 270,000, charges $6,346 for a comparable page.

Because of its positive experience with the Junco family paper in Monterrey, Comercial Mexicana, a leading supermarket chain, was one of the first advertisers to sign up.

"Being a newspaper from the same group, we have the background of quality, content, circulation and print quality," said Ricardo Padua, Comercial Mexicana deputy director of marketing. The Liverpool department store chain also is a regular advertiser.

"These are very professional people," said Eduardo Mallet, Liverpool's deputy director of advertising, but he said it was too early to judge results in Reforma, and the store continues to advertise in eight other Mexico City newspapers as well on TV and radio.

To give advertisers a taste, Reforma is giving away "courtesy space." One advertiser that has accepted this offer is Continental Airlines. Account Executive Patricia Tirado at Continental's agency Admark said Reforma had offered a one-time placement to the airline. "We normally wait six months for a new publication to establish itself," she said.

Mr. Junco, who originally was negotiating with publisher Dow Jones to start up Reforma, is still talking with the company about an undisclosed electronic media project. The Junco family still operates "Infosell," a financial newswire, which is required reading for the Mexican financial and business community, so it's believed the talks will focus on a joint financial news project.

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