Switching Costs in the Swedish Morning Paper Market

Abstract: The initial part of this paper presents an overview of research conducted on switching costs and their implications. Different types of switching costs are identified and categorised according to available research and examples are given. Further, switching costs are with the help of previous research put in relation to various business actions we may encounter on an everyday basis and how they affect our behaviour and the decisions we make as consumers. Examples include the effects of switching costs on return policies, competition and price matching guarantees. After a theoretical overview, the switching costs in the Swedish morning newspaper market are identified and categorised according to the reviewed research. The different types of switching costs are individually analysed and quantified for comparison and their correlation to the newspapers’ annual subscription prices is evaluated. Finally, the individual switching costs are summed up for each newspaper in order to provide a complete picture of the market faced by their customers and the switching cost distribution of the market is illustrated both in the form of a table and graphically, allowing for the providers with the highest and lowest switching costs to be identified. These providers are then briefly discussed along with the market’s most and least dominant switching costs and the possible reasons for their strengths and weaknesses.