Case Analysis For

Capital magazine Rodrigo Salvatierra Problem: Should the launch of Capital magazine be postponed or should Prisma Presse continue with the schedule to launch in September, if so, what should be the pricing, distribution and communication strategy? Alternatives: 1) Launch in September with a newsstand strategy: - Risky approach that can lead to more incertitude. + 55% margin of newsstand price. + The unsold rate will be lower every year. (From 50% to 30% in 6 years) + Lower costs for distribution and promotion. + 20% of the news magazine readers falls into the category. + newsstand strategy is not usual in the French market and could be beneficial. 2) Launch in September with a subscription strategy: + Stable sales every month. - The greater the number of subscriptions, the higher the costs for renewing and acquiring new subscriptions. - Higher costs for new subscribers. + Great discounts in this area could appeal more consumers. + There is no cost of unsold magazines. 3) Postpone the launch: + The economy is too unstable. + The market share will be low in a market that is really fragmented. - All research is lost, including the 2 prototypes already finished. + Advertising has reduced a 20% this year. - Prisma Presse needs new ideas every 18 months. Recommendation: I recommend launching the magazine with a newsstand strategy given the conditions of incertitude of the market and the economy, because this strategy reduces the marketing budget for the magazine by making only mass publicity and takes advantage of the news readers to make a larger market share. It could take longer to recover the investment but the magazine has a proven success in the target market. Prisma Press is financially big enough to handle a launch like this.