Industry Analysis Case Study

Case Title:

Reader’s Digest’s Bankruptcy: Loyal Readers, Disloyal Profits!

Abstract:
This case study deals with the reasons behind one of the most coveted and respected global magazine, an iconic brand Reader’s Digest, going bankrupt after being acquired by a private equity firm. The case can be used for the discussion and debate in the class on the Strategic Inflection Point (SIP) which if missed by the companies may question their very survival in the later stages. The case study details as to how the company built its iconic brand by conceiving the idea of a Digest magazine. It also details as to how the company expanded all over the world and over a period of time lost its market share and profits leaving it with the only option of bankruptcy. It also deals with the issues like: How will the company emerge from bankruptcy and try to increase its readership to sustain itself in future?

Pedagogical Objectives:

The case attempts to achieve the following pedagogical objectives:

• To analyse the anatomy of Reader’s Digest’s failure and understand the strategic lessons from the failure and also to examine whether Reader’s Digest missed any SIPs that could have averted the impending bankruptcy
• To debate and discuss all the steps taken to restructure Reader’s Digest magazine in the past and build arguments for and against the steps taken
• To discuss and debate the likely scenario’s for the Reader’s Digest in the light of Chapter 11 filing.

Keywords : Industry Analysis, Industry Structure, Strategic Inflection Points, Industry attractiveness, Publishing Industry, Brands and Branding, Porter's Five Forces Model, Corporate Strategy, Corporate Renewal, Turnaround