The inefficiencies of cutbacks

The Observer have announced that they are streamlining their offering into 4 sections. In the process, they are ending 3 of their 4 monthly magazines (several of which, I believe, are award-winning).

It is highly unlikely I will continue to buy it.

As a non-subscriber, my switching costs are minimal. I may prefer the tone of its coverage to other titles, but value – at least perceived value – plays an important role in the purchase decision. The quality of the magazines (along with the relative ease I can do the crossword) were major draws to the title. Both versus its competitors, the Saturday Guardian and its website.

And I don’t really feel like paying the same for less. So I may experiment once again with the Times, transfer my pennies over to its sister paper, or stick to the website.

Of course, I am assuming that the cuts mean that these articles will be discontinued. They may well be moved into the other sections. But given the need to cut costs, I am expecting that if this does happen, it will be on a much reduced scale.

This move may cut the Guardian group’s costs, but it is also going to negatively affect their revenues. They must be sure that the net impact of their finances is beneficial. But the net impact on their brand and identity is surely negative.

There is also the possibility that the move to streamline the Observer could have a secondary motive to make the Guardian look better by comparison.

Other titles such as the Express, Independent and People are already shells of their former selves. I’m hoping the Observer doesn’t go this way. It would be far better to convert it to web-only or end it completely than to see it published merely for appearances.

sk

Image credit: http://www.flickr.com/photos/uherrmann/

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One Response

  1. I agree – how surprising given that the magazines must have been the best way of reeling in unfamiliar buyers. Apparently the Sunday Times recently decided against a male companion title for Style, so on this basis I assume the magazines weren’t as effective at bringing in new readers as thought.

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