THE OBSERVER
It was the last Friday afternoon in August 1991. Four third-year Acadia University
students, who had just returned for the fall semester, were meeting at the Student’s 50-50
lounge. Before classes started, Randy Ansems, Stephen Connor, Steve Robart and Greg
Simpson had to decide whether to turn a course project, an inter-high school newspaper,
into a business.
Background
Randy and Greg were “local boys” from Kings County, Nova Scotia, where Acadia
University was located (Exhibit 1). Stephen and Steve came from Moncton, New
Brunswick (Exhibit 2). All four lived on the same floor in Crowell Tower, a student
residence, and had become friends during their first two years of Business Administration
studies at Acadia.
This case was prepared by Professor (Joe) Nan Zhou of Acadia University for the Atlantic Entrepreneurial Institute
(1992) as a basis for classroom discussion, and is not meant to illustrate either effective or ineffective management.
Copyright © 1996, the School of Business Administration, Acadia University. All rights reserved. Reproduction of
this case in any form is not allowed without permission. Distribution by the Institute of Case Studies, Acadia
University
The four students took an Introductory Marketing course in the 1991 winter semester.
This course included a group project in which marketing theories and concepts were
applied to a real world situation. The project requirement was well-received by students,
in part because the winning group decided, through a competition, would be exempt from
the final exam. The winners also had their names engraved on a trophy. another
important reason for the project’s popularity was that certain projects from earlier ;years
had involved local businesses, and had generated positive results that could still be seen
in the marketplace.
During their Introductory Marketing course, Randy, Stephen, Steve and Greg were highly
motivated. They had not only wanted to win the competition, but had also wanted to
develop a project that had the potential to grow into a business for them to run.
Greg, who had heard about a high school student newspaper from a cousin living in
Ontario, suggested to his friends that they create an inter-high school newspaper for
Kings County. He reasoned that a newspaper would provide a unique vehicle for students
from the six senior high schools to communicate among themselves. With their own
recent high school experience, the other three students agreed that the newspaper was
worth considering. But they were not sure if they could get it to work. First, they had no
training in journalism. Second, the project would require funding. Furthermore, they
were not sure if high school students would want the paper. After much deliberation,
however, they decided to try it.
They got a “boost” from Jack Jones, Senior Counsellor at the Acadia Small Business
Centre, who believed that the idea was original, interesting and viable. He also offered
suggestions on how to get it started.
Needs Assessment
The four students decided that the first thing they should do was to find out whether or
not area high school students were interested in an inter-high school paper. They would
do this by conducting a survey as well as leading a focus group.
They contacted a County School Board official and school principals, all of whom were
interested in the project. they were given permission to run a focus group and distribute
their questionnaires at the schools. some principals even helped distribute the
questionnaires.
The focus group, composed of ten students from different schools, found that high school
students were not interested in another “regular” newspaper, but were interested in a
paper with their own names and pictures and “fun stuff” in it. some indicated that they
would like to see a “career corner;” some also said they preferred to write articles
themselves rather than having them written by students form Acadia University.
Two hundred and fifty students approximately equal numbers of males and females) in
Grades 10 to 12 from all six high schools, responded to questionnaires in their
classrooms. Their responses confirmed the basic findings of the focus group. Ninety-five
percent of those surveyed liked the idea of a Kings County inter-high School newspaper,
88 % would read it, and 67% were interested in events taking place at other schools in the
county. Their preferences for types of articles, publication frequency, and price of the
paper, are show in Exhibit 3. Some respondents also named the local businesses they
frequented, and 44% said they would consider contributing articles to the paper. Some
even left their names so they could be contacted.
Although Greg and his friends could not find specific data on the economic status of
Kings County’s high school students, they found certain information on teenage markets
in recent business magazine and newspaper articles:
a. the average Canadian teenager lived in a dual-income household, had a parttime job, did some shopping alone, and had more influence on family
purchases than teenagers had in the past;
b. although many teenagers spent hours watching TV or listening to radio daily,
few read newspapers: and,
c. many teenagers did not pay much attention to ads in the mass media.
Greg and his friends were convinced that they could use this information to persuade
local businesses to advertise in their paper. According to Randy, “Since there are still no
other advertising media effectively reaching local high school kids, advertising messages
in our paper could reach virtually all the 2500 senior high students in the county. There
would be little wastage in the advertising dollar.”
Approaching Advertisers
With their information in hand, they set out to visit businesses most often patronized by
local high school students. because they had to use a car borrowed from Randy’s father,
they limited their efforts to nearby Kentville, New Minas and Wolfville, where three of
the six high schools were located. “We had to approach potential advertisers carefully, to
avoid seeming like greedy business students out to make a quick buck. We wanted the
business people to know that their money would be well spent, that they would be helping
their communities, and that we wanted enough money to cover only the costs of the trial
issue of the paper,” Stephen recalled later. “Although some firms didn’t exactly receive
us with open arms, we stirred up enough interest to fund the project.”
Of the twenty-five companies the four students visited, twelve made verbal agreements to
advertise in the paper and ten eventually bought advertising space.
Producing the Paper
Their next task was to product the trial issue of the paper. They made sure that it would
contain only “light” content based on information gathered from the focus group and the
survey. Each of the four students wrote on column, such as “Ray’s Advice,” and “Career
Corner.” The “Inside the School,” “Student Spot Light” (featuring high school students:,
and “sports” sections, were contributed by principals, coaches or students from the six
high schools. Upcoming movie attractions for the “entertainment” section was prepared
by the manager of a local cinema. To make the paper even more attractive, a
“Horoscopes” section and a “Puzzle Page” were included. A front-page introduction
explained how the eight-page paper was created. Staff from the athenaeum, Acadia
University’s student newspaper, helped give the paper a professional look. These staff
were very supportive and contributed their time at no charge.
The four students had been so busy putting the paper together, that the night before the
paper went to the printer, they realized that it still did not have a name. After much
debate and discussion, they settled on The Observer, because “we were kind of observing
what was going on at high schools as outsiders,” explained Steve.
Payoff
The day the paper came off the press, Randy, Stephen, Steve and Greg distributed over
2,500 copies to the six high schools. The looked impressive(Exhibit 4), and every high
school student who talked to Randy and his friends, said he or she liked the paper.
Besides being pleased with these comments, the four students were glad to find that they
had done better than break-even. The income statement showed that after paying all outof-pocket expenses they made a $58 profit (Exhibit 5).
April 2, 1991, was a big day for Randy and his group. Before a crowd of nearly 200
students from the Introductory Marketing course, they presented The Observer to a panel
of nine judges. The panel consisted of business executives and representatives from
finalist groups of the previous year. “Turning the idea into a successful product was quite
an experience. We have had great fun doing it and our customers have enjoyed reading
it,” said Greg, on behalf of the group. Much to their delight, The Observer was chosen
from among the five finalists as the winner of the Business School’s Annual Marketing
Competition. In addition to exemption from their final examination, each of the four
students got a “surprise bonus;” a $100 dinner certificate from the Old Orchard Inn, an
upscale local resort/restaurant which had sponsored the competition.
Randy, Stephen, Steve and Greg were very pleased with the feedback and the payoff on
the project. Before leaving Acadia University for the summer, they got word that the
School Board and the President of the Teachers’ Association might consider providing
financial assistance if the paper were published regularly. The four students resolved to
make a decision in the Fall about turning the project into a business.
Conclusion
During the summer, each of the four students discussed the potential business with
several friends. Some of their friends suggested that they should quit now instead of
getting involved further. Their friends pointed out that the Athenaeum lost money almost
every year, although it had a professional staff. It also received extensive funding from
the Student Union and sold advertising space regularly. They felt that it would not be
easy for four students with little experience in either ‘real world business’ of journalism
to develop the paper into a profitable business. These friends also felt that it would be
difficult for the four students to find time to run a newspaper business when their main
focus, like that of other students, was to keep their heads above water with their busy
course work.
Randy and his friends believed they had expended too much effort getting their idea off
the ground to quit now, but they also felt that some of their friends’ comments were valid
The Fall semester was only a week away and they needed to make a decision before
classes started.
Exhibit 1
Maritime Provinces
Exhibit 2
Respondent Preferences in the Questionnaire Survey
Type of article
Sports
Social
Gossip
Classified ads
Personal
Academic
82%
62%
57%
56%
54%
28%
Frequency of publication
Biweekly
Weekly
40%
33%
Price willing to pay
50 cents
More than 50 cents
Source: Company records
36%
35%
Exhibit 3
The Observer
Source: Company brochure
Exhibit 4
The Observer
Income Statement
March 27, 1991
Revenue
Chuckie's Casual Wear
Dairy Queen
Greco Pizza & Donair
Mahon's Stationary
McDonald's Restaurants
No. 12 Polo Ralph Lauren
Sandwich Tree Restaurants &
Catering
Sears Canada
Subway
Zack's Famous Frozen Yogurt
Total Revenue from Advertisers
$50
50
50
50
50
100
50
50
50
50
$550
Expenses
Newspaper expenses
Layout
Photography
Telephone calls
Transportation (Gas)
Typesetting
Printing
Miscellaneous
Total Newspaper expenses
Survey Expenses
Printing
Telephone calls
Transportation (Gas)
Total Survey expenses
Total Expenses
Net Income
Source: Company records
$14
14
7
35
5
360
14
$449
18
5
20
43
492
$58