A great example of non-price competition comes out of New York today. The Wall Street Journal is introducing a metro section about New York City, explicitly to draw new readers away form the New York Times. News Corp., run by Rupert Murdoch, owns the Journal these days, as well as the New York Post.
As owner of The New York Post, Murdoch has been willing to cut newsstand prices and lose tens of millions of dollars in his bid to outsell the New York Daily News. In 2000, the Post sold about 435,000 copies on an average weekday, compared with 714,000 for the Daily News. By 2009, the Post was up to roughly 530,000 copies while the Daily News had sunk to 570,000.
And Murdoch’s underlings have been accused of using rougher tactics than just price cutting or promotions.
Challenging the Times for revenues will also include reduced advertising rates by both the Journal and the Post.
While the competition in the market has included discount pricing, the focus now seems to be with content.
But he has been open about his goal of using his media properties to challenge what he considers a left-leaning news establishment in the U.S.And he took a swipe at the Times in a speech to New York real estate executives last month. “We believe that in its pursuit of journalism prizes and a national reputation, a certain other New York daily has essentially stopped covering the city the way it once did,” he said.
The real differentiation really seems to be political, and apparantly Murdof believes New York is turning conservative. I am not sure how that is justified, but this market works as another good example of competition giving consumers more diversity and choice.
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3 Comments
When we learned oligopolies and monopolistic competition, we had mentioned the concept non-price competition. That is defined as a marketing strategy in which one firm tries to distinguish its product or service from competing products on the basis of attributes like design and workmanship.
It can be contrasted with price competition, which is where a company tries to distinguish its product or service from competing products on the basis of low price. Non-price competition typically involves in promotional expenditures, (such as advertising, sales promotions, coupons), marketing research, new product development, and brand management costs.
In the example above, political position and views can also be a kind of non-price strategy.
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