Retailer Asda is planning an assault on the magazine market, by offering massive discounts on all consumer titles. The move, which will form part of the supermarket giant’s everyday-low-pricing (EDLP) strategy, is likely to start a price war.
Publishers say that the strategy is unlikely to fuel value growth, but will eat into their margins instead.
This will be the first time a UK supermarket has offered magazines at a discount to the printed price on a long-term basis. In the past, retailers have run discount offers, but for limited periods. The magazine industry, like the packaged goods market, can only recommend retail prices.
An industry observer says Asda has already trialled the EDLP strategy on children’s magazine titles.
One magazine publisher says: “Most titles are already at knockdown prices. Asda’s move will reduce publishers’ profit margins.”
A distributor adds: “I do not think an EDLP strategy on magazines will bring in new readers. It will merely reward loyal readers. My concern is that this will just steal market share from other retailers.”
The magazine industry expects Tesco and other retailers to follow Asda’s lead in offering consumers low-cost magazines.
Asda had no comment as Marketing Week went to press.