Retailer may be using relocation as tactic in commercial negotiations

This article is more than 7 months old

This article is more than 7 months old

WH Smith has moved the Daily Telegraph and Sunday Telegraph to the magazine section in more than 1,000 outlets across the UK as the retailer tries to gain the upper hand in commercial negotiations with the newspaper group.

Telegraph Media Group (TMG), the parent of the titles, said it had not requested the placement change, suggesting it is being used as a negotiating tactic.

In addition, WH Smith has suggested to store managers that the vacant Telegraph position in the “news” section be filled with copies of its closest rival, the Times.

“The Daily Telegraph is a long established newspaper with a reputation for quality journalism and should be displayed alongside other newspapers,” said a spokeswoman for TMG. “We have never requested that any retailer move or sell the newspaper within its magazine section.”

WH Smith, which has more than 500 high street stores and 590 travel stores across the UK, refused to comment on whether the company took the decision to relocate the Telegraph titles, which was first reported by the Financial Times.

“The Telegraph is easily accessible to all customers as part of our news and current affairs offering,” she said.

The stores have been told to keep the Telegraph in the magazines section “until further notice”.

About a third of the Telegraph’s total circulation, which includes subscriptions, comes from sales in newsagents, convenience stores and bigger chains such as WH Smith and supermarkets.

The Daily Telegraph’s circulation stands at about 317,000 copies a day, with the Sunday Telegraph at 248,288, according to the last official figures from the Audit Bureau of Circulations (ABC).

Relations between WH Smith and the Telegraph have changed since the arrival of Nick Hugh, TMG’s chief executive, in 2017 from Yahoo.

In October, the Daily Telegraph scrapped its promotional deal with WH Smith in which copies of its newspaper were given away with bottles of water. Hugh has shaken up the Telegraph, moving from a focus on print sales to a subscription model, both in print and online.

In October 2018, the Telegraph started to put most of its politics, business and rugby coverage behind its premium paywall as it began a process of dramatically cutting freely accessible content, in a move towards the successful model operated by the New York Times. About 80% of the Telegraph’s content is now behind a paywall.

To push readers in this direction at the start of the month the newsstand price of the Daily Telegraphrose by 25%, from £2 to £2.50, while the daily cost for a subscriber was maintained at £1.60. The newsstand prices of the Saturday and Sunday editions were also raised.

Last month, Hugh made a surprise decision to pull out of the monthly audit by ABC, which publishers and advertisers have historically relied on to measure sales and help establish advertising rates.

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“The ABC metric is not the key metric behind our subscription strategy and not how we measure our success,” the company said in explaining its decision to withdraw.

The publisher says it now has 423,311 total subscribers, with 213,868 of those digital – digital-only access costs from £3 per week – and 209,443 print.

Group pre-tax profits fell 94% from £14.3m to £900,000 in 2018, according to TMG’s most recently reported results.

Last year, the reclusive billionaire Barclay brothers, owners of the Telegraph, revealed they were exploring a potential sale of the titles.