Wall Street Journal
Wall Street Journal
Dow Jones and Company is a global provider of business news and information. Its primary operations were in three business segments: print publishing, electronic publishing, and general-interest community newspapers. Now he stands in front of a decision what to do with two segments of the business, the Print Edition and the Interactive Edition.
• Wall Street journal is well-established and known newspaper and it is the largest circulation newspaper in the US. It has been in an unrivaled position as a top daily newspaper for 109 years. It also enjoyed tremendous loyalty among readers. The subscription renewal rate was 80%. This journal has a well-established international market as well.
• The total advertising market in the United States for print medium is projected to exceed $82 billion by 2001 up from $72 billion in 1999.
• The WSJ interactive edition is the largest paid subscription site on the WWW. Most information pay sites on the Internet are poorly organized or charge too much for services provided.
• The market for Internet users is growing continuously. So, there might be an opportunity of expanding internet-based Interactive Edition.
• Newspaper industry was facing a future of little to no growth and mounting competition from other forms of news delivery, such as Internet.
• There are two primary sources of print revenues. They are sales/subscriptions and advertising. Advertising rate was dependent upon the circulation level.
• Newspapers faced increased media competition in the 1990s, making advertising sales a harder pitch.
• Many people are very skeptical of paying for the information on the Internet.
• Editorial and news skills for a near-real time environment became necessary skills for electronic publishing. In edition to that, there is an increased competition on the Internet between different information providers.
• The WSJ print edition stats is not promising. The paper is slowly dying out. Average age of readers is 52, which doesn’t look promising.
• Wall Street journal’s traditional size was larger than that of typical print newspapers. This format was believed to be more appealing to advertisers and to readers alike.
• The business-versus-general interest focus of The Wall Street Journal kept it relatively immune from direct competitors.
• Interactive journal was called to be the best single financial site on the Internet. It provides useful information to investors and alike.
• Subscription renewal rates were approximately 75 – 80 per cent.
• WSJ Interactive Edition has a cost advantage over competitors that were Internet-born.
• Both WSJ print edition and interactive edition were in the same market; hence they were competing against each other within one company.
• WSJ print edition is more expensive. That is why interactive edition took over a part of subscribers (30000 US subscriber who are the former WSJ print edition subscribers)
The overall situation is OK. This company has its established market and has a cost advantage, because of economies of scale and well-established brand name. The Internet-based business is good alternative if the print edition is going out of business, because of an increased Internet use.
Alternative strategies and consequences flowing of those strategies
Change the information provided by the Interactive Edition so Print Edition can retain its market share.
Wall Street journal is well-established and known newspaper and it is the largest circulation newspaper in the US. It also enjoyed tremendous loyalty among readers. It had a subscription renewal rate of 80%. This journal has a well-established international market. The advertising market is projected to grow for print media. The WSJ’s format was believed to be more appealing to advertisers and to readers alike and the business-versus-general focus kept the journal relatively immune from direct competitors.
The newspaper industry was facing a future of little to no growth and mounting competition from other forms of news delivery, such as Internet. Statistics shows that the average age of readers is 52. Advertising as one of the primary ways of revenue was heavily dependent on circulation level. If there were no growth in industry those revenues would shrink, because of an increased competition for advertising sales.
Focus on the Interactive Edition development and let the Print edition stay as it is until break-even and then close it.
Interactive edition has a cost advantage over the competitors that were Internet-born. It already proved to be the best and the largest single financial web site with subscription renewal rates of 75-80 per cent. The market for Internet users is growing continuously.
There are many people that are very skeptical to pay for something through the Internet, because you never know what you going to get for price paid. There are many other information providers on the Internet who do not charge for information provided, so it might be hard to stay competitive as a pay site. If people were paying for the service, this service must be much better and useful for users.
Maintain both editions in the way to advertise and promote each other. Give the special discounts to subscribers for both editions.
Maintaining both the Print and Interactive Edition is a bigger target market. Because there are still subscribers who prefer to have the hard copy (loyal subscribers), and those for whom Interactive Source is fine. In my opinion those who use the Interactive source are mostly those who need the precise up to date information in a timely manner, for example every hour or two. Hence, there will be more revenues and it will eliminates the risk of being deadlocked with just one choice. Those two editions may also advertise each other and hence increase revenues by the way of double subscriptions.
Both WSJ print edition and interactive edition were in the same market; hence they were competing against each other within one company. Interactive Edition is a cheaper Internet-based one and therefore took over a part of former WSJ Print Edition subscribers. There is also a chance for management competition within those two segments of Dow Jones.
Conclusion on recommended course of action
In my opinion strategy 3 is the best alternative in this case because The best argument is that Dow Jones is not deadlocked with only one edition and has opportunity to develop both streams. The Interactive Edition could be used as supplement to the full Print Edition. In order to be able to run both segments efficiently the company needs to establish a good atmosphere between those to divisions and to make sure they are not competing against each other but on the opposite side helping to promote each other.
Third strategy is basically a do-nothing one. However, discounts for users of both editions should be developed. For example, if the person is already subscribed for print edition he/she could get a 50% discount on Interactive edition, while print division would repay 25% to Internet-based division in order to promote status quo between those two and avoid management competition and dissatisfaction. Trial periods for Interactive and Print editions may be used to attract new customers. People usually would like to see first what they paying for.