Expectations:Bjective

Part 1:

objective:

To determine the internal and external factors that must be considered in the development of a marketing strategy, evaluate their likely impact on the firm and generate possible competitive advantages for the development of a sound strategic and tactical direction.

Expectations:bjective:

Expectations:

Complete a full SWOT Analysis for the textbook Case – “USA Today” and use it to analyze and determine 3 Competitive Advantages that USA Today could build upon.

Begin with a complete SWOT matrix grid that specifies both Internal and External factors.It is expected that you research and provide meaningful data/information as it relates to external factors.

Analyze the SWOT, matching strengths to opportunities and provide 3 Competitive Advantages that you feel are available for the company to build upon. Support your analysis. Tell the reader why these are the best options and be sure to have facts to support it.At this point, there is no need to “solve” the case or provide further recommendations.

Format:

The document should be in APA format, including properly formatted title page, and reference page.

A minimum of 3 external sources beyond the textbook are required.

Part 2

Case Analysis“ USA Today”.

You have been hired by the company to develop the strategy that will turn this situation around.

Using your SWOT analysis as the foundation for detailed analysis, prepare the following portions of your recommendation to the firm.

Identify the key/root problem. While there may be several problems and a multitude of symptoms, identify the problem you feel is central to this case. Be sure to describe this in marketing terms and support it with specific data from the case.
Alternative Solutions. Developtwoalternative solutions to the defined problem. This should not be a laundry list of actions one could take to address every symptom, but alternative actions that could correct the problem at hand.
Identify the pros and consof implementing each alternative. Clearly articulate the advantages and disadvantage to each of your proposed solutions.
Proposed Solution to the Problem: Select one of the alternatives and explain why it would be best. Include data from your research (beyond the data in the text) that supports your choice of solutions.
Recommendations for Implementation: Identify how you propose to implement the selected solution. Include the key factors of marketing, target market, environment, or marketing mix elements (product, price, promotion, or distribution) and what the expected results (positive and negative) might be.

Keep your responses complete and concise.

3 References required. Be sure to cite your sources within the text and include your APA Reference list.

CASE US TODAY

Synopsis: As the entire newspaper industry sits on the brink of collapse, Gannett and USA Today are working to avoid disaster and transform the nation’s most read newspaper into tomorrow’s best resource for news and information. This case reviews the history of USA Today, including its continued use of innovation to stay on top of the technological and sociocultural shifts that are rapidly changing the newspaper industry. In the face of continual competition across a variety of media sources, the future of USA Today depends on its ability to continually push the envelope of innovation and offer value-added, proprietary content to ensure continued differentiation and the future of the USA Today brand.

Themes: Product strategy, innovation, target marketing, distribution strategy, changing technology, changing sociocultural patterns, customer relationships, competi- tion, differentiation, strategic focus, SWOT analysis

USA Today, subtitled “The Nations Newspaper,”debuted in 1982 as America’s first national general-interest daily newspaper. The paper was the brainchild of Allen H. Neuharth, who until 1989 was Chairman of Gannett Co., Inc., a diversified international $6.8 billion news, information, and communications company. Gannett is a global information juggernaut that publishes 85 daily and 1,000 nondaily newspapers, operates 23 broadcast television stations reaching 20 percent of the U.S. population, and is engaged in marketing, commercial printing, newswire services, data services, and news programming. Gannett is currently the largest U.S. newspaper group in terms of circulation. Its daily newspapers, including USA Today, have a combined circulation of 14 million readers every weekday and 12.6 million readers every Sunday. Gannett’s total online audience in the United States is roughly 27.1 million unique visitors per month—an astounding 16.1 percent of the total U.S. Internet audience.

When USA Today debuted in 1982, it achieved rapid success due to its innovative format. No other media source had considered a national newspaper written in shorter pieces than a traditional paper and sprinkled with eye-catching, colorful photos, graphs, and charts. Designed to address the needs of a sound-byte generation, readers found USA Today’s content refreshing and more engaging than other papers. Circu- lation grew rapidly from roughly 350,000 in 1982 to approximately 2.1 million today (Monday through Friday). This compares to approximately 2 million for second-place The Wall Street Journal and 1 million for The New York Times. USA Today’s website, is one of the Internet’s top sites for news and information.

The History and Growth of USA Today

In February 1980, Allen Neuharth met with ‘‘Project NN’’ task force members to discuss his vision for producing and marketing a unique nationally distributed daily newspaper. Satellite technology had recently solved the problem of limited geo- graphical distribution, so Neuharth was ready to take advantage of two trends in the reading public: (1) an increasingly short attention span among a generation nurtured on television, and (2) a growing hunger for more information. Neuharth believed that readers faced a time crunch in a world where so much information is available, but there is so little time to absorb it. His vision for USA Today positioned the paper as an information source that would provide more news about more subjects in less time.

Research suggested that USA Today should target achievement-oriented men in professional and managerial positions who were heavy newspaper readers and frequent travelers. Where The New York Times targeted the nation’s intellectual elite, thinkers and policy makers, and The Wall Street Journal targeted business leaders, USA Today was to be targeted at Middle America—young, well-educated Americans who were on the move and cared about current events.

By early 1982, a team of news, advertising, and production personnel from the staffs of Gannett’s daily newspapers developed, edited, published, and tested several different prototypes. Gannett sent three different 40-page prototype versions of USA Today to almost 5,000 professional people. Along with each prototype, they sent readers a response card that asked what they liked best and least about the proposed paper, and whether they would buy it. Although the content of each prototype was similar, the layout and graphics presentations differed. For example, one prototype included a section called ‘‘Agenda’’ that included comics and a calendar of meetings to be held by various professional organizations. According to marketplace feedback, readers liked the prototypes. The Gannett Board of Directors unanimously approved the paper’s launch. On April 20, 1982, Gannett announced that the first copies of USA Today would be available in the Washington and Baltimore areas.

USA Today Launches

On September 15, 1982, 155,000 copies of the newspaper’s first edition hit the newsstands. On page one, founder Neuharth wrote a short summary of USA Today’s mission statement, explaining that he wanted to make USA Today enlightening and enjoyable to the public, informative to national leaders, and attractive to advertisers.

The first issue sold out. A little over a month following its debut, USA Today’s circulation hit 362,879—double the original year-end projection. In April 1983, just seven months after its introduction, the newspaper’s circulation topped the 1 million mark. Case Exhibit 11.1 illustrates USA Today’s growth in circulation over time. The typical reader turned out to be a professional, usually a manager, about 40 years old, well educated, with an income of about $60,000 a year. The typical reader was also a news or sports junkie.

For a newspaper, USA Today was truly unique. Designed for the TV generation, the paper was laid out for easy access and quick comprehension by time-pressed readers. Examples of this formatting included extensive use of briefs, columns, sec- ondary headlines, subheads, breakouts, at-a-glance boxes, and informational graphics. These techniques captured the most salient points of a story and presented them in a format that readers appreciated. Gannett’s research had shown that readers got most of their information from such snippets and that they were just as interested in sports, movie reviews, and health information as they were in traditional news. Each issue presented four sections: News, Money, Life, and Sports. The paper’s motto fit its design: ‘‘An economy of words. A wealth of information.’’

The History and Growth of USA Today 503

Because USA Today was nontraditional, the critics were numerous and fierce. In their view, the paper was loaded with gimmicks—tight, short stories; no jumps from page to page, except for the cover story (stories that jump to another page are one of newspaper readers’ major complaints); splashy, colorful graphics everywhere; a distinctive, casual writing style; a colorful national weather map; a roundup of news items from each state, one paragraph each; summary boxes; little charts and statistics- laden sports coverage; and a focus on celebrities and sports, with more detailed sports stories than almost any other paper in the nation. There was no foreign staff and little interest in the world outside the United States. It was quickly derided for its shallowness by journalists and labeled ‘‘McPaper’’—junk-food journalism or the fast food of the newspaper business—due to its terse, brash writing style and its short coverage of complex issues. Even within Gannett, Neuharth met with bitter resistance from some senior executives. Nevertheless, readers admired the paper for its focus on brevity and clarity, short sentences, and short words.

Clearly, the paper filled a gap in the market, satisfying several unmet needs and wants. USA Today’s success has come from listening to its readers and giving them what they want. The paper communicates with readers on a personal level very quickly (many of the short, fact-filled stories are under 250 words), clearly, and directly, in an upbeat and positive way. The color is riveting and gives the paper a contemporary look, and so is the space-defying number of stories, factoids, larger than usual pictures, bar graphs, and charts, all squeezed onto each page without seeming too crowded. Instead of confusion, readers get neatness and order. The paper’s dependably consistent or- ganization enables readers to go directly to any one of USA Today’s major sections. As a result, it takes an average of only 25 minutes for a reader to peruse the paper.

Marketing Program Innovation

In spite of its critics, USA Today’s circulation surpassed 1.4 million by late 1985 as the paper expanded to 56 pages in length. The cover price had also increased to 50 cents, double its original price of 25 cents per issue. By this time, USA Today had become the second-largest paper in the country, with a circulation topped only by The Wall Street Journal. Although Neuharth had predicted that USA Today would quickly turn a profit, it took about five years to move into profitability, with USA Today losing an estimated $600 million during its first decade. By 1993, however, profits were approximately $5 million. One year later profits doubled to about $10 million.

During its early growth, the paper unearthed a class of newspaper reader few others had stumbled upon: the business traveler. Airline deregulation had led to a large general price decline for airline tickets, inducing a swell in business travel. On-the- road business travelers wished to keep abreast of both world and national news as well as what was going on in their home state and how their local sports teams were doing. USA Today rushed in to fill the void; but in doing so quickly entered direct competition with The Wall Street Journal. By this time, hard-line newspapers, including The New York Times, began adding color; shorter, more tightly written stories; and beefed-up circulation campaigns to compete with ‘‘The Nation’s Newspaper.’’ The Wall Street Journal followed suit by introducing two new sections—Money & Investing and

Marketplace—to broaden the paper’s coverage of media, marketing, technology, and personal investing. In the face of this competition, as well as an awareness of changing reader needs, USA Today responded through innovation of its own.

Product Innovation To stay ahead of the imitative competition, USA Today decided to become a more serious newspaper with improved journalism. The shift from primarily soft news to hard news began with the space shuttle Challenger disaster in 1986. By 1991, editors began focusing much more sharply on hard news rather than soft features, and by 1994 under president and publisher Tom Curley, there was a massive drive to upgrade the paper to be a more serious, more responsible news- oriented product.

Gannett also incorporated less traditional value-added features to keep readers interested. The paper added 1-800 and 1-900 ‘‘hot-line’’ numbers that readers could call for expert information on financial planning, college admissions, minority busi- ness development, taxes, and other subjects. Thousands of readers responded to reader-opinion polls and write-in surveys on political and current event issues. Editorial pages were also redesigned to provide more room for guest columnists and to encourage debate. Gannett also initiated a high school ‘‘Academic All Star’’ program that was later expanded to include colleges and universities. The increasing ubiquity of the Internet in the late 1990s also resulted in some changes in content. For instance, the Money section began to focus more on technology issues and to look at business through an ecommerce perspective.

The first major redesign in USA Today’s history occurred in 2000 as the paper moved from a 54-inch to a 50-inch width. The goal of the redesign was to make the paper easier to read and cleaner in design. The pages were slimmer and hence easier to handle, especially in tight spaces like airplanes, trains, buses, and subways, and the paper fit more readily into briefcases as Gannett had learned from focus groups.

Promotional Innovation USA Today also innovated in its promotional activities. His- torically, the paper had limited its promotion to outdoor advertising and television. However, in the late 1980s Neuharth undertook a ‘‘BusCapade’’ promotion tour, trav- eling to all 50 states to talk with people about USA Today. Neuharth succeeded in raising public awareness of his paper, which was credited for USA Today’s move into profit- ability. Encouraged by his success, Neuharth forged ahead with a ‘‘JetCapade’’ campaign where he and a small news team traveled to 30 countries in seven months, stimulating global demand for the paper. During a visit to the troops of Operation Desert Storm in the Persian Gulf in 1991, General Norman Schwarzkopf expressed a need for news from home. USA Today arranged for delivery of 18,000 copies per day. The overseas success of USA Today led to the publication of USA Today International, which is now available in more than 60 countries in Western Europe, the Middle East, North Africa, and Asia.

Early on, USA Today faced a challenge in selling ad space to advertisers because they were not convinced that it would pay to advertise in the paper. Gannett’s first strategy for enlisting advertisers was the Partnership Plan, which provided six months of free space to those who purchased six months of paid advertising. USA Today also began to accept regional advertising across a wide variety of categories such as travel,

The History and Growth of USA Today 505

506 C A S E 1 1USA Today: Innovation and Evolution in a Troubled Industry

retail, tourism, and economic development. Color advertisements could arrive as late as 6:00 PM the day before publication, giving local advertisers increased flexibility. The paper also moved aggressively into ‘‘blue-chip circulation,’’ where bulk quantities of USA Today are sold at discounted prices to hotels, airlines, and restaurants, and are provided free of charge to customers. Today, over 500,000 copies of USA Today are distributed through blue-chip circulation every day.