Among a number of other daily newspapers, the Daily Star has taken a continuous hit in circulation on a monthly basis. On the back of this, they made the brave move of slashing the price of its paper in half from Monday 5th October 2015; from 40p to 20p. This is something we expect will have had a significant impact on Northern and Shell’s revenue, but on the other hand has driven the positive effect on circulation that they were after. The immediacy of growing numbers speaks for itself: on day one of the price cut, sales grew c. 7% week-on-week (WoW), and this upward trend has very much continued into the new year.
Prior to October, Daily Star saw an average circulation drop on a monthly basis in 2015 of 0.67%. Given this, we’d have expected December to finish at around the 395,000 mark. However, the price decrease has led to the opposite; a continual upward trend. In October, circulation went up by nearly 7% month-on-month (MoM) from September, and up into November by 4%, and into December by just less than 1%. December’s circulation finished at 451,739; this is a 12% increase on the estimation. This has put them in 6th place with the daily national newspapers as of December figures, but without the price change, they could have ended up in 8th place.
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Typically (and especially with national press), circulations tend to dictate the rate of buying advertising space, however this boost in circulations have not yet appeared to have had an effect on rates. This is hugely beneficial to advertisers buying the space as the costs per thousand (CPTs) are much cheaper, accessing more of their demographic for the same money. However, if Daily Star can continue to drive up their circulations by reminding their audience that their paper is only 20p (as they have been doing with their current TV campaign), they may well have a leg to stand on in attempting to push up rates in parallel with their circulation increases. So far, they have maintained a circulation increase for three consecutive months and this will certainly be something to watch in 2016 to see if this does continue, and what the result and effect of this will be on advertisers moving forward. It will also be intriguing to see if other papers follow suit in the price change to achieve their own circulation increase.