In recent years the precipitous drop in newspaper circulation has been due in no small part to the shift from physical to digital consumption via computers and mobile devices. Yet the decline in circulation has another layer to it – rising prices for both newspaper subscriptions and for single copies at the newsstand.
The pricing decisions of major newspaper companies reflect their desire to stem the losses from the attrition of their print subscribers. Yet attempts to recoup lost revenue through higher prices while essentially asking subscribers to pay more for a lesser product has predictably been negative.
According to a Nieman Lab article by Ken Doctor, Gannett, one of the largest publishers in the country, raised home delivery prices by over 25% and still saw a loss of 0.9% in circulation revenue in 2014. The Des Moines Register, one of Gannett’s largest papers, has lost 14% of its daily circulation revenue and 23% of its Sunday circulation over the last three years. Even worse, single copy sales are down 53 percent in the same time period. Other newspapers haven’t fared very well either. The New York Daily News has lost 20% of its daily home delivery business while losing 43% of its daily single-copy sales.
Compounding this, rising prices at the newsstand for single newspaper copies haven’t helped circulation fortunes either. The Alliance for Audited Media says that for the first time last year the price for a daily newsstand paper hit $1, while the price for a Sunday paper hit $2.
Insider Take:
The precipitous decline in single copy sales as prices have increased shows the efficacy of subscriptions as a baseline business model for newspaper publishers. As prices for single copies rise, less are purchased and publishers are forced to cut back on how many copies are printed and where they are sold, further fueling their decline. The papers who have transitioned their physical subscribers into digital subscribers are leading the way in curbing their losses, however slim those margins may be. The circulation data bears out focusing efforts on growing a digital subscriber base at current prices as the industry continues to evolve. Publishers should be wary of raising their prices by too much too soon, no matter how much it makes sense in the short term.
