The following appeared in an announcement issued by the publisher of The Mercury, a weekly newspaper.
“Since a competing lower-priced newspaper, The Bugle, was started five years ago, The Mercury’s circulation has declined by 10,000 readers. The best way to get more people to read The Mercury is to reduce its price below that of The Bugle, at least until circulation increases to former levels. The increased circulation of The Mercury will attract more businesses to buy advertising space in the paper.”
The argument in the announcement issued by the publisher of a weekly newspaper, The Mercury, to increase its circulation is unconvincing because its conclusion depends only on unsubstantiated assumption of lowering the price of the newspaper below the price of The Bugle. Each of the following areas merit further explanation before it can be given any degree of credibility of its conclusion of increasing the circulation by lowering the price.
Firstly, no sufficient information is provided so that The Bugle’s popularity can directly be compared to that of The Mercury. It may be possible that The Bugle might be a financial newspaper while The Mercury can be a daily newspaper. In such a scenario, the comparison may not make sense at all. Moreover, there is no information about the performance of The Mercury before five years, when The Bugle was introduced in the market.
Secondly, the assumption that decreasing the price of The Mercury below The Bugle, will help in increasing the circulation of the former is fallacious. It may be possible that the price may not be the only concern for the readers of The Mercury. It might be possible that the time of the edition may not be proper. For example, assuming The Bugle’s edition comes in the morning and The Mercury’s edition in the afternoon, most office going people might prefer to have a morning newspaper so that they can catch up with the happening while commuting but on the other hand, The Mercury’s edition might be publishing in the afternoon session. Additionally, one cannot ignore the possibility of the lack of quality and the current affairs news in The Mercury as compared to that of The Bugle. One cannot also ignore that as the readers might be interested more in the local news, which The Bugle might be covering extensively while The Mercury might not.
Lastly, the assumption that decrease in the price of The Mercury, resulting in increase of the circulation, will help in increasing the advertising space may be completely flaw. One cannot ignore that such marketing gimmicks of lowering the price for a short period of time cannot go unnoticed by any company tied with The Mercury for advertising. Additionally, it might be possible that the readers might not prefer The Mercury due to its inclination to more advertising space than the news. In such a scenario, even if The Mercury increases the advertising space further after reducing the price will backfire on the strategy of The Mercury only.
Due to the many holes in the reasoning in the arguments of the report, it is difficult to take the arguments seriously. Unless further evidence surface in each of the areas discussed above, the given premises are insufficient proof that the conclusion drawn is viable.