±±¾©Èü³µpk10

For its readers, carrying a copy of The Guardian has always been a bit like wearing a badge that says 'I'm a fashionable, free-thinking, urban intellectual', and a lot of people - about 400,000 - were part of that club.

But the problem for The Guardian is that even the strongest brands struggle in the face of radical innovation from competition.

In the five months since September, which have seen both The Independent and The Times launch compact editions, The Guardian's sales have suffered.

February's ABC of 369,726 represents the paper's worst sales figures in more than two decades.

On the face of it, there has been little in the way of a fightback. There have been no big brand campaigns - The Guardian's marketing is product-led - and no obvious increases in spend to match the extra millions spent by its rivals.

Not that things have been quiet; behind closed doors the paper has experimented with every conceivable format. It has ruled out going compact because it does not indulge in the kind of 'shouty' journalism that the tabloid format arguably requires.

But editor Alan Rusbridger has said The Guardian may not remain "exactly the same size" in a year's time, and observers suggest a Le Monde-style format - smaller than broadsheet but larger than tabloid - is a possibility.

Starcom Motive press buying director Adrian Pike believes The Guardian would be ill-advised to change its format, but adds: "It needs to come up with something fresh and new within its existing format."

Sources close to The Guardian say it is keeping its powder dry, waiting for excitement and marketing spend on the new formats to die down before taking action.

We asked Toby Constantine, the former marketing director of The Times and Sunday Times and now vice-president of global market-ing and research at Metro International, and Channel 4 head of marketing Bill Griffin, what The Guardian should do next.

VITAL SIGNS
National morning qualities' average daily net circulation
                    Feb 2004   Jan 2004   Change    Feb 2003      Yr/yr
                                             (%)               chng (%)
The Daily Telegraph   906,317    914,981     -1.0     927,807       -2.3
The Times             655,876    660,713     -0.7     670,907       -2.2
Financial Times       439,035    422,543      3.9     451,799       -2.8
The Guardian          369,726    383,157     -3.5     408,983       -9.6
The Independent       256,378    248,876      3.0     222,487       15.2
Source: Audit Bureau of Circulations

DIAGNOSIS

Toby Constantine

The Guardian is perhaps facing its greatest challenge. Fierce competitive pressures are testing the loyalty of readers in a way not seen since the price wars of the mid-90s. Tabloid editions have not only increased choice, but added product desirability.

This innovation has prompted Guardian readers to take a close look at their newspaper, and subconsciously re-assess their relationship with the brand. Some readers are undoubtedly wavering and flirting with alternatives.

As recent circulation figures illustrate, the more promiscuous have already switched loyalties. They have shown themselves willing to trade the brand values and political ethos of The Guardian for a smaller and more convenient format that meets their lifestyle needs more closely.

The problem is not insurmountable. The Guardian has one of the strongest brands in the market and a loyal readership. Like it or loathe it, people know what it stands for and where it is positioned.

The Guardian faces a huge dilemma. To change format now smacks of following a trend, but inaction may result in the product and brand appearing stale, dated and out of touch with modern readers.

Bill Griffin

The current thinking on The Guardian appears to be that it is paralysed and devoid of ideas. While the competition revels in glamorous formats and new readership, the poor Guardian has been left behind looking stuffy and dated.

Anybody with more than a passing knowledge of the brand will know that this is not the case.

The Guardian is one of the most innovative broadsheets in the world under Alan Rusbridger. The idea that his staff are now scratching their heads and wondering what to do next is a fallacy.

For Rusbridger, format and editorial are inextricably linked in a way that The Times and The Independent have failed to appreciate. He feels that to go tabloid will undermine the editorial values of the paper. We are seeing an editor holding his nerve in a market that could easily go into total meltdown were his paper to react to the recent changes.

There is a plan at The Guardian - we just haven't heard about it.

I'd be happy to bet that whatever innovation it produces, in its own time and on its own terms, will make the new compacts feel very vulnerable and successfully woo back recent defectors.

TREATMENT

- Boost investment in the product to demonstrate modernity and relevance, without necessarily following the rest of the market into tabloid-land.

- Use marketing to reinforce the brand message to Guardian readers, reminding them of its commitment to them. Make them feel recognised and rewarded.

- Double efforts to attract a younger audience.

- Produce a truly distinctive new paper, which appeals to the core readership, but is sufficiently inviting to a new audience.

- Don't abandon your instincts - bide time and let the market settle.

- Increase marketing spend.

- Don't worry.