Check out the promotion being run by Woolworths and the Adelaide Advertiser. To get the $10 discount off meat you have to purchase the newspaper. An interesting deal which at first glance seems an odd fit.
It feels like News Limited newspapers and supermarkets are been running more of these promotions – buy the newspaper and get a ‘deal’ at the supermarket.
After yesterday’s story in The Age about Coke and supermarkets I wonder why any supplier would want to deal with Coles or Woolworths. They’re like a spider, luring you into their web and they slowly kill you.
Woolies are running a similar promo in my small town, (pop approx ~3000).
Pick up a Daily Telegraph and get 10% off your meat. Only started on the weekend and hard to say what the effect is so far, but it isn’t nice for us or the local butcher.
Assuming News LTD are aware of and are a partner to the promotion, it really doesn’t say alot about thier loyalty to us when we still home deliver thier product at a loss.
I wonder if we stopped delivering (not that we plan to) would Woolworths happily take over our run under the same financial arrangements?
James, is the discount meat with a newspaper you sell or do they need to buy the newspaper at the supermarket?
No they have to buy it at the supermarket as part of the meat sale. They are our sub agent so we still get half commission on the paper which helps, but it still isn’t nice in a small town.
Interesting. Smart for the paper and the supermarket. I think we will see more deals like this.
The publisher owes you nothing. That would be their view of the world.
Yes very true Mark, and a realistic attitude towards it, no one owes you anything in buisness.
If they keep doing such promo’s will just have to roll up our sleves and think of other ways to attract customers with or without the help of the papers.
James we should be doing that already. We need to run our newsagencies as if newspapers are gone. If we don’t we will die when newspapers die or shrink to a level which means little traffic for us.
It would be interesting to see what the price of the meat would be before this promo, It does not make sense to drop $10 off the meat just for the sake of a few cents profit from the paper unless they have inflated the price of the meat to start with. coles and Woolies are notorious for doing this and the ACCC seems powerless to stop it.
What they want is for people to link papers with the supermarket just as they do with mags, cards etc. We have had customers browse our mags and then tell each other they will buy them when they do their shopping even though they are instore and have the cash there and then, they feel it is “more convenient to get it all in one hit”.
Luke sadly I think you are right. By welding supermarkets and newspapers these co-dependent big businesses get bigger.
Our challenge is to break the cycle which facilitates this.
Too bad we are lacking a product line like meat that we can pre-inflate the prices on, and then discount for our customers. I dont think I want to discount Lotto, or mags.
Luke,
Meat, when not on special, can have a relatively high GP%. Woolworths might not much, if any, profit on the sale of the meat and paper alone – but very few people will walk out with just those two items in their basket.
It’s also about creating, or breaking, habit based shopping. Breaking the habit of purchasing a newspaper from only a newsagent. And creating the habit of “daily top-up” shopping where you visit the store multiple times per week, if not every day, rather than the traditional once per week shopping trip.
If you can wipe off $10 for 2kg of meat just because you buy a newspaper then that is not just having a high GP that is robbery, but as a supermarket manager you would know.
Luke,
If the steak sold for between $15-20/kg then the supermarket would only have to be making between 25-30% GP to cover the cost (not taking into account the profit on the newspaper, or any increase in sales a result of the promotion).
Actually Luke, I think you make the most important observation when you talk about customers and convenience in your first comment.
This is where newsagency customer service can get let down. Too often we think of “customer service” as engaging in conversation, facilitating unusual requests, having product knowledge, etc. For many customers good service can most often be that which is quick and efficient.
Reducing queues at the counter, having efficient touch screen POS, integrating EFTPOS/phonecards and offering new services such as Paypass/Paywave and small value pin-less transactions can greatly assist in improving how ‘convenient’ customer perceive your store to be.
The same applies to product offering. Deviating from the traditional newsagency range into convenience offerings such as bread, milk, tea/coffee and cold drinks may help break through the perception of inconvenience.
The same goes for things such as not having a lotto counter completely separate from your general POS counter – customers do not like lining up twice. We have one store in town that doesn’t even offer EFTPOS at their lotto counter – making customers use an ATM to get cash out.
I would go so far as to say that for many newsagencies, convenience is a much more powerful selling proposition than all those things we traditionally associate with customer service. Not that those aspects are not important as well – just of lesser importance to a very large, very busy, group of consumers.
Yea Jarryd, Well said.
I have found Tyro has increased our sales, because it is quick, private and easy. Also offering cashout has been good for sales. Certainly offering speedy service with maybe just a smile, nil conversation is exactly what a lot of people want.
Speed IS important.
Certainly we sell drinks and smokes on the basis of speed because the supermarket is cheaper and right next door.
We have just got assess correctly when speed is called for; and when conversation is cdalled for.