Does reading The Wall Street Journal makes one more likely to get better jobs and bigger salaries?
The Saturday edition had a half page Ad for student subscription. You can find the claims made in that Ad here.
The problem with these claims is correlation does not imply causation. Regarding these claims:
- This is a survey, not a controlled experiment where they randomly assigned people to a control group and treatment group and followed them over years to see if there are statistically significant differences in their GPA, salary etc.
- There is omitted variable bias here. The same trait that made the students and others read the WSJ is possibly the driver behind their success. Self motivated and driven people are going to equip themselves with every possible tool and training to get ahead in life. If it is not WSJ they would have read other journals and newspapers to get ahead. While the claim that “Journal helps the student get ahead with a robust set of career preparation resources” is valid the following statement “Did you know students who read The Journal are 140% more likely to be starting a full-time job upon graduation?” is misleading because it implies causation.
Few years back there was a TV commercial for WSJ that showed a man going up in career because of WSJ. The commercial starts with a man, walking in rain, stopping to pick a copy of WSJ from a news vendor to protect himself from the rain. He later runs into an executive of his company in the elevator, who upon seeing the newspaper in his hand offers him instant promotion. It is one thing to use humor to imply causation, no one will take it seriously. It is however not factually correct when they use survey data and make a causation claim based on correlation.
Other reads: There was also an article on Fantasy Football that implies causation from correlation.
In one of my previous posts I talked about why free is not a viable business model. With every Web2.0 business based on free model, can anyone hope to charge for services? The answer comes from an essay by Gordon Crovitz, on online news media pricing:
For years, publishers and editors have asked the wrong question: Will people pay to access my newspaper content on the Web? The right question is: What kind of journalism can my staff produce that is different and valuable enough that people will pay for it online?
Applying this to Web based businesses, which for some reason are looking at their marginal cost of production ($0.00) to price their offering, “It is not what it costs a marketer to produce or whether people will pay for your service but does their service add unique value that is not available for a lower price anywhere else?”
Of course this depends on whether people who recognize the value are still willing to pay for it even though no such service is available elsewhere. That depends on whether or not the marketer gave it away for free in the beginning and is now trying to move from a free to fee model. If you had trained your customer by giving them your service for free it is not going to be easy to switch them to a fee model.
So why not charge them from the beginning? Why worry about freemium/ freeconomics and building users base? Why invent complicated schemes based on growing mind share?
The truth is simpler: People are happy to pay for news and information however it’s delivered, but only if it has real, differentiated value.
True for any online service.
For related discussion on this see a post by Peg Corwin in her Score Chicago blog. She discusses Chris Anderson’s model and the proposal by Walter Isaacson on newpaper.
See also a case for Unbundled Wall Street Journal in my Unbundling blog.
If you do not subscribe to the WSJ, the print or online version, head over to the newstand near you and buy today’s paper.
The cost of $1-$1.50 you pay is a bargain considering the value you will get from the articles on the credit criss, Bernanke’s warning, why we use measuring cups and not kitchen scales, the European recession.