Murdoch’s Sun Slashes Its Price In London To Stop Falling Below 3 Million Circulation While The Times Goes Up 5 pence, Equaling The Price Of Its Quality Rivals

It has been sunny and warm in London this week, but not so sunny that it was necessary for all those red sun umbrellas to show up all over town. Upon closer inspection they were actually Sun umbrellas with about 100 youthful hawkers wearing bright red T-shirts flogging the tabloid at just 20 pence, 15 pence off its regular price.

So what is daily Murdoch-owned tabloid circulation leader up to? With its July ABC figures showing its circulation down to 3,128,829– off 2.45% over the same period last year – and with August always being a rotten month with people away on vacation, circulation must be falling perilously near that psychologically important  3 million mark and that calls for drastic action.

But there could be more to it than even that. There is really bad blood between News International and Associated Newspapers, both locked in a nasty free PM newspaper battle that is not doing Associated’s paid-for Evening Standard any good. But Associated also owns the Metro brand in the UK and has announced it is going to increase its southern England (including London) AM circulation by some 250,000. And since the Sun is very dependent on its London newsstand sales – they account for about 20% of the newspaper’s total circulation  and there is no doubt that Metro has already hurt those sales – then this could be a calculated “second front” move by Associated to draw blood at News International by trying to force the Sun’s numbers down.

It was Rupert Murdoch who started a blood-letting UK newspaper price war several years ago from which only in the past couple of years have most of the quality newspapers recovered.  Murdoch signaled an end to that “war” by raising the price of his Times to where it was only about 5 pence less than its quality  rivals, and finally this week he went the whole distance and raised the price of the Times another 5 pence to 70 pence, just like the other quality newspapers. The Times has never made money under Murdoch and has been financially covered by its sister Sunday Times that makes a bundle, but the whole company is being squeezed with cost-cutting to pay some £600 million ($1.2 billion, €880 million) for new generation printing presses and a new printing plant, so now is as good a time as any for the Times to increase its circulation income.

So, on the one had you have the Sun slashing prices in its primary distribution area, while the Times increases its price. That makes it even more plausible that it is somewhat panic stations at the Sun. The newspaper has not been adverse to such regional price cuts in the past -- its Scottish edition has been at 20 pence for some time now -- but it has, until now, left its primary market out of such shenanigans.

Based on history, the Sun has reason to believe its price cut will work. Back in 1993 when tabloid circulations were also having difficulties the Sun slashed its price bringing in some 368,000 additional sales the next month.

Of course, that was before there were such animals as “free newspapers” muddying the sales water and it will be interesting to see if some of those Metro readers who get their newspaper for free might just shell out the 20 pence for the cut-rate Sun.

The price cut also puts the Sun a full 50% below the price of its tabloid rival, the Daily Mirror, owned by Trinity Mirror. So far it has not responded with any price cut of its own, and one question will be whether  there will be any circulation slippage there?

And just to ensure the Sun’s numbers do go up, it has embarked on a big TV marketing campaign promoting vacations at just £9.50 ($19, €14). – September 6, 2007

Keywords:marketing promotion,newspaper marketing

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