Tag Archives: daily star

ALL SHOOK UP

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August 17, 2011

It’s now been almost six weeks since the dramatic implosion of the News of the World following the fallout of the phone hacking scandal. However it’s only now, with the release of July’s ABC figures, that the impact of the demise of Sunday’s largest selling newspaper can be properly gauged. With 2.7m potential readers up for grabs, the challengers have launched a frantic flurry of price cuts and promotions but who has succeeded in wooing the orphaned NotW readers?

Unsurprisingly, the lion’s share stuck to what they knew and switched to an alternative tabloid. The remaining Sunday red tops were rejuvenated with an average net circulation increase of 66% last month. The Daily Star on Sunday fared the best with an additional 400,000 additional copy sales in the three weeks following the NotW’s closure – a 130% period-on-period (PoP) increase; its highest circulation since 2002. (Elsewhere, however, it’s daily equivalent had the biggest year-on-year (YoY) decline in July, down 16%.) Other tabloid stablemates that profited from the market shake up were the Sunday Mirror and The People, up 64% and 70% PoP respectively.

While most didn’t stray too far from the tabloid sector, some more adventurous readers braved mid-market territory with the circulations of the Sunday Express up 14% and the Mail on Sunday up 15%. With a circulation now at 2,255,399, MoS is still Britain’s biggest selling Sunday title by a significant margin. This has no doubt been helped by the recent launch of the Mail Rewards Club, a weekend-centric loyalty scheme offering free vouchers and nice freebies, that the Mail has been promoting.

At the top end of the market, there were also strong performances for some of the quality Sundays – no doubt a combination of a few ex-NotW readers experimenting, coupled with a general spike in news interest to follow the hacking scandal itself.

Bucking the upward trend though was The Sunday Times, which limped out of the ABCs with a 1% decrease, the only Sunday title that failed to gain new readers during the period and the first it has dropped below 1m since 1962, as readers question whether they want to support any News International title at all. Conversely, the Sun readers remained loyal as it continued to be the biggest daily publication with a circulation of 2.8m.

All in all, with so many switching allegiances and trying new titles, there were some who clearly could not plug the gaping hole left by the NotW in their lives. The overall Sunday market is down 8.6% PoP. Is there a future home for them? Or have they simply turned their back on Sunday newspapers? And will those who have picked up a different paper stick around once the price reductions and freebies disappear? What’s Hot will keep you informed as and when this becomes clear.

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Back for Good

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June 23, 2011

This week Richard Desmond’s multi media company Northern & Shell announced profits that have more than tripled from £8.9m in 2009 to £30.3m in 2010.

Until recently, Northern & Shell consisted of a print group that included papers Express and Daily Star as well as magazines Ok!, New! and Star. Desmond moved into the world of broadcast last year when he acquired Channel 5 for £103.4m a move that many at the time said did not make sense.

What’s clear from this announcement is that against all odds Desmond has orchestrated an enormous turnaround of Channel 5. In 2009 RTL posted a £34m loss for Channel 5 – but in 2010 announced a £15m profit. As well as stripping out an entire layer of management and investing 1.5bn over five years, the channel was also helped by a rebounding 2010 TV market.

Whilst the TV station is performing well, the papers have had a much tougher time. Discounting the cover price across both papers affected the margin, but dropping the price of the Star to 10p would have contributed to the bulk of the £43m costs within the print division. This did however drive circulations growth that sales team were able to convert to a rumoured double digit YoY growth in ad revenue which again was helped along by a rebounding 2010 market buoyed by the World Cup.

The future for Northern & Shell lies in the long-term profitability of Channel 5. This year Desmond has invested £200m in a deal to secure the return of Big Brother. Celebrity Big Brother launches this summer followed by a traditional series this winter for three months. This is particularly clever, as if Channel 5 can grow its share of impacts significantly this year through the Big Brother format, it will stand it good stead for its negotiations with agency groups for 2012. Despite rumours of its decline, Big Brother contributed 19.8% of Channel 4’s programming impacts for 16-34 adults in 2010.

Desmond has not washed his hands completely of his print titles and on 15th June announced categorically that rumours of him looking to sell his papers or magazines are not true. He is investing in a new printing press in Luton expected to open late 2011. This will help with the availability of colour ad slots within their newspapers that an ageing West Ferry press can’t deliver.

Northern and Shell are selling advertising packages across TV, print and magazines – which for an advertiser provides an interesting cross promotional opportunity with a level of editorial buy-in not offered by other titles. An example of this is Northern & Shell’s purchase of the Health Lottery, which seeks to raise money for health charities and will be marketed across all properties. It is understood that in the future Northern and Shell will continue to build upon media interests particularly in the digital arena.
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