The Age newspaper is 160 years old today and some have used social media to say long live newspapers. I wish I could say that. The weekday editions of The Age must be perilously close to the point where printing and distributing them is loss making, where falling advertising revenue is not being covered enough by a rapidly (in newspaper terms) rising cover prices because copies sold are decreasing at double-digit levels.
Fairfax CEO Greg Hywood has said that newspapers will stop being printed when they are no longer profitable. They must have reached that conclusion with the community newspapers they have decided to close.
With costs cut to the bone and cover prices up 50%, they have little else they can change. The reality is there is no upside for print newspapers. They have been trumped by technology for delivering access to news and the print model has not adjusted to provide on a daily basis something consumers want in sufficient quantity. As with anything you cherish, one hopes for a good death.
On the two major Australian publishers, what is different for Fairfax compared to News is the ratio of subscriptions to over the counter sales. For Fairfax, the percentage of subscriptions is far higher. But long-term subscriptions come at a bottom line cost to the business and only those inside the company have the data to know how close to the line their mastheads are each day of the week.
I still expect to see a capital city daily newspaper to cease daily publication in the next twelve months. I don’t want to see it but I expect it will happen.
Twelve months! Ouch, I do hope your prediction is wrong.
doom and gloom
If all papers ceased tomorrow I would lose about $20 a day. Possibly less as I would have space to offer more product. Analysis of the paper shows that 35% are bought on their own, the perception however from the counter tells me those customers are in the store later or earlier for other items anyway.
The paper is a product that we should be able to walk away from unscathed at this time in its life cycle. Do not despair however as new and exciting opportunities exist and we are well placed to exploit them.
It would be easier still if we had say a national association that exercised our strength and market position nationally, but I dream …..
Well said Brett !
I have new very unhistorically newsagency focused product lines in store that make me as much money as I would make from newspapers in a week in a single sale and most importantly they engage with the customer they are targeted at and I have little competition.
No doom and gloom Jim … opportunity.
Brett I think the last thing we need is a strong association focussing on the needs of all when the gap between those growing and creating their own success and those shrinking and waiting to be told what to do is so great.
Paul and Brett don’t forget that the newspapers (that you may not make much money on any more) are one of the core products that bring customers to your (gift) store.
Just because you yuppies don’t buy the Age in numbers compared to the SMH, tells me more of the lack of mental ability do there of reading more than 3 sentences. gees Mark it’s not the papers fault.
ed
I think your’ve misunderstood this blog . The people who post here dont buy newspapers they sell them.
Brett, my figures show about 60% of paper sales are on their own and they are worth about $10 to $15 a day to us. Like you there is little downside and plenty of upside in focusing on more viable and profitable product. Selling 3 cards makes more for me than 100 papers, thats an example where our energy should be placed. A lot of customers will be sad to see papers go but many of them aren’t buying a paper regularly anyway.
40% better then nothing
Ed no one has said it is the paper’s fault. The problem for newspapers today is part disruption affecting the print medium, part change (regardless of generation) of how we want to consume news and part lack of business planning by publishers to create products that are relevant and iterating for daily consumption.
Jenny , the lines I’m talking about, for me at least , aren’t gift lines. I’ve actually veared off into Hobby lines and started an online business to compliment it. The customers I get in the door for this do not buy newspapers as part of the sale and newspapers don’t bring them in at all. Anything that I’m now looking at developing for or adding to my business has to predominantly drive its own traffic and not rely on existing business elements for support.
We know we need to have the papers but the work involved and the space taken up for a GP of about $17 per day is out of whack. Not complaining just sayin.
I’ve commented before also about papers.
If I sell all my mails today I will make $19.
If I was opening my shop today for papers it wouldn’t be worth my while.
I’m very pleased that I have diversified enough for me not to need papers to survive and I suspect that most newsagents are somewhere near that position.
The key point about newspapers is to not be complacent, to not expect them to continue to bring in traffic for years to come. Our business plans need to consider newspaper traffic as cream and not core.
Sounds as though the end is very near. Our local country paper is still quite strong, but it’s closure would not affect us greatly as we would not have to deliver, run cars, employ drivers and get up early.
The husband of the editor had a weird conversation last Sat morning with us, he was almost crowing that when papers end our business will be ruined and how would we feel about that?