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Analyses of Issue--Please Review-Newspaper Analyses

Expert replies
by KPMG_GMAT » Mon Dec 31, 2018 6:12 am
The argument that by lowering the price of the Mercury newspaper below the bugle will help to increase the circulation of the Mercury newspaper omits some important considerations that must be addressed in order to substantiate the argument. The statement that follows the description that by ensuring increased circulation, more businesses will buy advertising space in the paper only describes the effect once the circulation increases and not a proper way of increasing the circulation. This clearly does not constitute a logical argument in the favour of the Mercury's decision, and it certainly does not provide support or proof of the main argument.

Most conspicuously, The argument does not provide information regarding the total number of readers reading the Mercury newspaper either today or five years back. It might be true that The Mercury originally will have a reader base of millions of people spanning the entire country. In that case, a minor decrease like 10000 readers should not have such a drastic impact on the company for it to go to the extent of reducing the prices of the newspaper.

Secondly, in a weak attempt to prove its point, the argument states that being a lower-priced newspaper, the Mercury lost it's circulation. This might not be true, there might be several other factors which would have led to such a decrease. E.g. the readers would prefer more of sports related news, or news related to business. The Mercury would not be offering them the relevant content that they desire to read. In that case, the better alternative strategy for the Mercury to increase it's circulation would be to conduct a market segmentation and consumer behaviour analyses in order to find out the topics of interest for majority of the newspaper readers rather than simply reduce the price below the competitor.

Third, in today technology driven world, people are choosing newer forms of electronic devices for viewing news and other content. E.g. All the major news papers and agencies have their online apps and websites for readers to receive their news completely free. Major business also have utilised this opportunity to reach out to readers by advertising their content online. In that case, The Mercury's competitor is not the Bugle as much as the newly emerging digital news platforms who have led to the reduction in the readership for the Mercury. Creating an online presence can significantly help the company in gaining it's readership like it had before.

Finally, as the argument leaves out several key points of consideration, it is not sound or persuasive. If it included the items discussed above instead of solely explaining the reduction in readership due to lower price offering by the competitor, the argument would have been more thorough and convincing.
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Source: — GMAT Essays (AWA) |

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