Introduction
SWOT analysis is a useful tool for implementing the recommended alternatives to increase Harlequin’s global readership market share. The research focuses on the importance of implementing the price and product strategies to increase Harlequin’s readership market. The research centers on the company’s endeavor to put into motion the place and promotion areas of the marketing strategy to ensure Harlequin’s leadership in the readership market segment.
Marketing entails focusing on the four P’s of marketing.
Body
Problem
Increasing the Harlequin global market presence
Alternatives
- Harlequin should negotiate better global–author deals. The company can use present competitor author deals as a basis for increasing its
- Increase the number of outlets selling Harlequin books around the world.
- Increase the advertising budget to make the Harlequin name more exposed to current and prospective clients and book dealers.
- Lessen operating expenses to increase company profits.
Pros of each alternative
In terms of alternative 1, the authors will be happy to be given the right to negotiate a more favorable royalty fee for each book published by Harlequin. Likewise, the company will profit from an author deal that benefits both the author and Harlequin Company. The authors will be able to bring their sentiments, complaints, suggestions to the Harlequin management during the global author dealing making.
In terms of alternative 2, increasing the outlets will increase revenues. Increasing the outlets will increase the Harlequin products’ presence. Increasing the outlets will entail hiring more writers to craft more romance-based books.
In terms of alternative 3, increasing the advertising budget will increase the company’s exposure to current and prospective clients. Increasing the budget increases revenues. The increase in the advertising budget would increase global revenues, especially in the romance books area.
In terms of alternative 4, reducing expenses will allow allocation of the saved money to pay for other unavoidable expenses. Reducing the expenses will increase Harlequin’s net profit. Reducing expenses would translate to more money allocated to increase in salaries and benefits of the employees and managers.
Cons of each alternative
In terms of the first alternative, negotiating may result in the authors’ uncompromising stand in terms of the discount rate. The Harlequin management may not have the time to negotiate the best author deals. The management may strike an authorship deal that is forced on it by arrogant authors on a take it or leave it policy.
The management may not have the time to research the economic or financial effect of the authorship deals.
In terms of alternative 2, setting up additional outlets will cause the company to pay additional operating expenses for the new branch. The additional outlet may not generate enough author deals causing a drain in the Harlequin coffers. The additional outlets may not be needed because there may not be enough global authors to make the opening of a new branch profitable.
In terms of alternative 3, increasing the advertising budget may not be necessary because there will be no significant increase in online clients. Increasing advertising may not be needed because the book client market segment is saturated. Increasing the budget would entail a reduction of the available cash needed for other more important projects or activities.
In terms of alternative 4, reducing operating expenses may include reducing the advertising expenses; reduction in advertising will reduce revenues.
Reducing operating expenses may entail reducing the marketing personnel serving clients’ needs wants, and caprices. Reducing expenses may include reducing avoidable costs; this may be looked upon negatively by the employees affected by the expense reduction.
SWOT Analysis
Strengths
Harlequin is the largest romance novel, publisher. Industry trend indicates a growing trend for single title women’s fiction is growing. Consequently, the demand for series romance novels remains stable.
Harlequin books were sold in more than 100 markets around the world. In addition, the Harlequin books continue to be translated into different languages to bolster the books’ revenues around the world. Harlequin also sold books under the mystery series types. In addition, the company published books focusing on the male action-adventure market segments under Harlequin’s Worldwide Library and Gold Eagle published books.
Further, the company holds a large share of the readership market. The company projected more than 50 million readers in the United States of America. Harlequin also projected that 50 million readers will read me despite their busy schedules. Most successful publishers are creative editors at heart and contribute more than risk capital and marketing expertise to the books they publish. The organization must add value to the book to be considered as a publisher. The single title publishers allowed the distributors one-half of the profits generated. Cost includes a 12 percent royalty fee paid to the authors of the published books. Other costs include warehouse, handling costs, and selling expenses. The remainder of the earnings helps defray the indirect publishing expenses.
Furthermore, the company successfully started and grew into a very profitable book publishing company. It started as a packaged, consumer goods company in 1968.
The company has bought the Mills and Boon romance book series. With a growth of 25 percent growth each year during the 1970s era, the company became the world’s largest publisher of women’s series romance fiction books. Torstar, a Newspaper publisher had bought Harlequin Enterprises. The company had taken over the distribution of its books in the United States market segment from the book distributor, Simon & Schuster Press. The Schuster press was classified as a large single-title publisher with a strong book distribution supply and marketing chain.
In addition, the Harlequin Company generates lots of books under the themes of sexy, fund, contemporary romance. On the other hand, the Silhoutte books focus on delivering a different type of service to each diverse client. The products of creativity will bring clients from around the world. Under the Harlequin system, each new book is included in the Harlequin Company’s list of products and services. The Harlequin books had a similar marketing format as the other books sold in the bookstores and other stores selling basketball products.
Further, the success of the Harlequin product line precipitated from the company’s editors reviewing each book manuscript submitted by thousands of authors for quality. The books were edited in terms of elements, plot, storyline, main characters, setting, pages allocated to the romance part of the novel. In addition, the editors examined each Harlequin book in the process by determining the quality of the books’ plot, realism vehicle, level of fantasy, social and individual problem discussion and resolution, and the quality and pages devoted to the romance part of the book series.
The books are sold in strategically located places. The books were also sold in supermarkets, drugstores, and mass merchandising. The Harlequin owners can buy products at the nearest department store selling the products and processes. The harlequin products had achieved huge store sales success with its long list of popular book titles. The Harlequin books were displayed on the same shelves as weekly women’s magazines. The dealers displayed the Harlequin books for four consecutive weeks or one month. The retailer would return any unsold Harlequin books after the four weeks had expired. Consequently, the retailers would replace the outdated Harlequin books with the latest or newest issues.
Further, the Harlequin Company saves on avoidable costs to increase profits. The Harlequin Company subcontracted its printing services. The Harlequin book authors were only paid a mere 13 percent of the selling prices to defray the expenses of running a book publishing business. Globally, the Harlequin books are sold in 250,000 book retail outlets around the world. An estimated 80,000 are located in the United States. Another 50,000 are classified as supermarkets and drugstores.
Another feather in the cap of Harlequin’s publishing success that aids in increasing client loyalty is the company’s hiring of quality editors. The editors would work with more than 1,300 writers to come up with a very excellent finished product. The finished product is based on very excellent story outlines, plots, and thrilling climaxes. The editors are required to find authors to make more than 1,000 new books sold annually in many stores strategically located around the world. The Harlequin Publishing Company must launch its series of romance novels to retain its readership clients for the next few years, just like in the past.
The company generated revenues from its romance stories. Exhibit 6 shows that the Harlequin book title Longest Pleasure sold the highest number in terms of romance books. The book generated 304,000 unit sales. This is followed by another Harlequin book entitled Alien Planet. The book generated 297,000 in unit sales. The third placer is the book, War Moon. The book is not a Harlequin signature book. The Worldwide Library ran into some operations problems. Consequently, Harlequin had to shut down the library to avoid further losses. In retrospect, the Harlequin romance series books had cornered more than 80 percent of the United States romance readership market alone. Table 2 shows that the North American Women’s Fiction Market generated 100 percent of the entire segment size of 1,220. The editors of Harlequin generally receive about 30,000 manuscripts for study and evaluation. The manuscripts are edited to determine if they can pass the rigid quality standards of Harlequin Press.
The company generated revenues from the sale of books in a direct to reader book sale program. The company established the Harlequin Reader Service Book Club. The club caters to the wants, needs, complaints, suggestions, and caprices of the book readers. The program includes contacting the club members to offer them the priority to buy a newly published Harlequin book. In exchange, the prospective book buyers can buy the books at discounted or membership prices. To make the book readership club successful, the company advertised the book club membership in the radio, television, and newspapers. Harlequin generates more profitable revenues by publishing longer and more expensive series books and raising the market price of each Harlequin paperback. Table 1 shows that total unit sales had dropped to 199 in 1993. This is lower than the total sales units generated in 1992 amounting to 205 sales units.
Weaknesses
Facing the steady loss of share in the growing total women’s fiction market, Harlequin ponders on launching a single title women’s fiction program. Harlequin Company is currently not engaged in the single title romance story market segment.
It is emphasized that the conventional single title books cannot be predicted. The retail stores would display the Harlequin books for a few weeks. Harlequin generates revenues from the store dealers selling the Harlequin products on their store shelves.
Opportunities
The company, Harlequin, can launch its products in the single title women’s fiction novel. Harlequin should increase the popularity of single title women’s fiction by producing books under this very profitable book category. Many clients are patronizing single title romance and women’s fiction books as series romances. The company’s success is due to Harlequin’s focus on the captured women’s readership market. The single title women’s romance book Industry statistical trend indicates a growing trend for single title women’s fiction is growing. Consequently, the demand for series romance novels remains stable. Single title publishing is currently a high-risk venture.
Several years ago, Harlequin failed in the single title business.
Exhibit 5 shows that there is a rise in the demand for single title romance books. Harlequin Company should jump into this market segment to increase revenues. The 1990 figure indicated there were 112 million books sold under the single title romance books category. In the same year, the regular harlequin series romance books had reached sales figures of only 85 million books. Likewise, the 1989 data shows that there is a rise in the demand for single title romance books. The 1989 figure indicated there were 102 million books sold under the single title romance books category. In the same year, the regular harlequin series romance books had reached sales figures of only 83 million books. Lastly, the 1988 data also confirmed the trend. The 1989 data shows that there is a rise in the demand for single title romance books. The 1988 figure indicated there were 94 million books sold under the single title romance books category. In the same year, the regular harlequin series romance books had reached sales figures of only 82 million books. This proves that Harlequin should jump into the bandwagon known as single title romance books to increase its book revenues.
In addition, the Harlequin Company launched its worldwide library. The company aimed to cash in on the readers’ growing need for single title books in 1986. The authors were excited to widen their authorship field with the opening of the Harlequin Worldwide Library. The average age of the readers of the Harlequin books is 41 years of age. Consequently, the readers were generally married and had a child or children. The Harlequin loyal clients spend about three hours a day ready the Harlequin romance books. The Harlequin books have been made very popular through the untiring efforts of current clients advertising the benefits of teaching subjects discussed in the books. Another plus sign that helps generate high Harlequin revenues is readership loyalty. Most of the Harlequin clients return to the stores to get the latest copy of the next Harlequin book issue.
The Harlequin organization can expand its current store outlets to attract more clients. The company continues to advertise its products and services on television, radio, and television medium. In addition, the company advertises its products (books and other related items) in the newspapers and other advertising locations to increase the popularity of the Harlequin pocketbooks and textbooks. The products were advertised in Cosmopolitan, Radbook, Glamour, and Good Housekeeping women’s magazines. The advertisements in the women’s magazines emphasized the benefits of buying Harlequin books.
The Harlequin and Silhouette romance brands of the Harlequin Publishing Company published 13 different titles in magazines and other media advertising organizations. The company published 64 titles each month. The book series had been positioned to cater to the different cultural upbringing of clients. The success of the company is grounded on support. All the members of the Harlequin group can visit the Harlequin plant site to study ways of reducing avoidable costs and expenses. Harlequin Company’s publishing success is built on purchasing cheaper raw materials.
Consequently, the cheaper raw materials translated to lower retail prices. In exchange, the lower prices translate to an increase in the number of clients buying Harlequin books and other products or accessories. The company generates a profit of 15 percent on each paperback sold in the company’s book stores. The success of the Harlequin book sales is due to the company’s contribution to print new books printed and distributed to different retail locations in a predetermined configuration. For example, the company publishes four book titles within one month. Next, the retailer of the Harlequin books earns a huge profit on each book sold in the market. The retail establishments sell the books published by Harlequin. Another main advantage of making it well in the publishing industry is the publishers’ printing of many different titles.
In terms of costs, the Harlequin profitably pays only $ 0.09 per book in terms of selling (promotion) expenses. Likewise, the cost of distributing the books amounts to only $ 0.18 per book. In Canada, Harlequin set up its branch to cater to the book needs of current and prospective book clients. In the United States, Pocketbooks, was hired to distribute the Harlequin books within the United States territory. The Pocketbooks chain of bookstores is a subsidiary of one of the largest United States publishers, Simon & Schuster. The stores are sold in drugstores, and discount department stores. Harlequin also contracted Barnes and Noble and other book store chains to carry the Harlequin line of books in their stores’ display inventory. Harlequin books were sold in 70 percent of the supermarkets and 55 percent of the bookstores. In Europe, the Harlequin books were sold in kiosks and tobacco outlets.
Threats
One of the threats is competitor product sales. The Harlequin was confronted by a continuing reduction in the company’s target market. The clients prefer books sold by competitors engaged in the single title romance books. Harlequin ponders on encroaching into the competitors’ single title romance market segment. The romance story marketing strategy focuses on launching a single title women’s fiction program. Harlequin’s revenues declined during the 1980s and 1980s.
Give Recommendations and Implementations
It is highly recommended that all four alternatives be implemented. The four alternatives must be implemented as soon as possible to increase the Harlequin Company’s net profit.
Conclusion
Marketing entails focusing on the four P’s of marketing. The research shows the importance of implementing the price and product strategies to increase Harlequin’s readership market. The research shows that the company must endeavor to implement the place and promotion areas of the marketing strategy in order to ensure Harlequin’s leadership in the readership market segment. Indeed, using the SWOT analysis as a basis for implementing the recommended alternatives will increase Harlequin’s global readership market share.