Magazine article Marketing

OPINION: Look into the Mirror's 20p Price Tactic - the Sun Will Stare Back

Magazine article Marketing

OPINION: Look into the Mirror's 20p Price Tactic - the Sun Will Stare Back

Article excerpt

In the beginning there were the four Ps: product, promotion, place and price. This is essentially the palette of colours with which we marketers paint our pictures.

Pricing is by far the worst practised because, unlike the more fluffy P's, pricing transports you to a very different world: your competitors' strategies must impact your decision-making; complex elasticities of supply and demand demand extremely detailed scenario planning; and you must have up-to-date fixed and variable cost data. A wrong decision will almost certainly result in you losing your job and your company losing profits.

Of course, it's a world that eventually you have to enter when all the other marketing options have been exhausted and your situation continues to worsen. Our case this week: the Daily Mirror. Faced with declining ad revenues and market share Trinity Mirror has recently repositioned the brand as an upmarket tabloid. Having altered the product and promotion Ps, Mark Hayson, managing director of Trinity, last week announced a price cut of 37% for the Daily Mirror - the stronger the brand, the less it relies on price to communicate value, it will now cost 20p. He proudly declared: 'With the Mirror brand stronger than it ever has been, it's the perfect time to shout about the value of the paper.'

Of course he is completely wrong. The only products that use low pricing to communicate value are commodities, and commodities are the complete opposite of brands. We buy commodities such as water, aeroplane tickets and newspapers because their low price provides us with value. …

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