N.J. Dailies Discount ABC Rule

By: Mark Fitzgerald

After years of sometimes bitter debate, the Audit Bureau of Circulations (ABC) last year let newspapers count in their top-line paid-circulation number copies that are sold for as much as 75% off the regular price.

Yet, when the rule got its first outing in the six-month reporting period that ended last Sept. 30, few papers took advantage of it: Of the 800 or so papers reporting in the FAS-FAX, only about 125 reported any sales at the deep discount — and almost all of those were hotel and other third-party bulk sales.

The deep-discount rule won’t show up any stronger when publishers report results for the six months ending March 31, if the dailies in the highly competitive New Jersey market are any indication. An E&P survey of circulation directors there found papers are nearly uniformly shunning the rule in home-delivery offers. Only one paper, the Herald News in West Paterson, acknowledged using the rule, and that was only in limited geographic areas. Some Garden State papers are even going in the opposite direction (that is, full pricing).

Circulation directors say that, in these tight economic times, they don’t want to give up any subscription cash. “We really don’t want to erode revenue right now,” said Gary J. DiSanto, who heads circulation for three Gannett Co. Inc. papers: the Asbury Park Press in Neptune; the Home News Tribune in East Brunswick; and the Ocean County Observer in Toms River. “If we can get the 50% or even full price, that’s the direction we would want to take.”

Even in the most competitive markets, deep discounting on home delivery is nonexistent. “We’re not doing anything with it at all,” said Edgar W. Hippo, circulation director of Advance Publications’ The Times in Trenton. “There’s a crunch on for money, so the timing just isn’t there to take advantage of the rule.” (Ed Kelly, circulation director of the Journal Register Co.’s The Trentonian did not return phone messages for comment.)

John Murray, the Newspaper Association of America’s vice president of circulation marketing, said the New Jersey papers reflect the entire U.S. industry: “The 25%-to-50% rule for selling home delivery, to the best of my knowledge, has been used sparingly — if at all.” U.S. circulation directors, he added, are questioning whether it is worth giving an even deeper discount to a customer who won’t subscribe at 50% off the regular price.

That’s a lesson learned at The Record in Hackensack. Last year, the paper offered year-long home delivery of the Friday, Saturday, and Sunday issues for just $19.99. At the end of the year, when the paper bumped subscribers up to $48.88, fewer than half renewed, even though the price was less than a dollar a week. “We learned something there — sticker shock from one price to another was a factor,” said Vice President of Circulation Robert T. O’Sullivan.

One paper in the anti-discounting camp, Gannett’s Courier-Post in Cherry Hill, sells home delivery at the full rate, with an occasional premium tossed in. The Daily Record in Parsippany went full price to avoid churn, said Circulation Director Andrew Mok: “People keep looking for the best deal and keep dumping the paper.” The no-discount has had a perhaps surprising effect, Mok said. “We’re the only Gannett paper in New Jersey that has actually grown home delivery.”

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