A blog on issues affecting Australia's newsagents, media and small business generally. More ...

Author: Mark Fletcher

Tatts reps are wrong to use newsagency closures as an excuse for expanding retail channels

A newsagent recently told me what their Tatts rep said when challenged by the newsagent about Tatts moving into other retail channels: with so many newsagencies closing we have no choice.

Newsagents who hear this need to not let whoever says it get away with it. Ask for evidence. Ask for a list of newsagencies that have closed and resulted in other retailers being engaged.

Maybe the Tatts rep was sharing a private opinion. Regardless. they were in the business representing Tatts. They should have been more careful with their words.

Tatts needs to own its decision to expand into other retail channels.

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Lotteries

Christmas in the newsagency

kxxmasHere’s the front of one of my shops as it looked two days ago. I am posting the photo here to show what we are using facing into the mall to attract shoppers. What you can see in the photo will be different to what is in place next week – we constantly adjust the message.

This is the shop that is tracking 15% year on year revenue growth and a significant Gross profit realignment away from the traditional newsagency Gross Profit of 28% to 32%.

While there is now reasonable discussion in the newsagency channel about the need to attract new shoppers, there needs to be more discussion about shifting GP from the traditional to a new model.  The better your GP the more you can weather peaks and troughs in traffic flow.

This shop does not have lotteries. It does not have tobacco products.  Newspapers are half way down as are magazines. Newspaper sales are up 13% year on year (units) while magazine sales are up 10% year on year.

Our goal with the shop front is to attract people who wander in for a browse. Thanks to layout and shop floor engagement plenty of these purchase on impulse. We then rely on our loyalty program to bring them back.

Click on the image for a larger version.

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Newsagency management

Selling Clive Palmer

qessayWith Clive Palmer such a large and polarising character in federal politics and business circles, the latest Quarterly Essay is timely – and an opportunity to pitch the title away from its usual location. Put it in the spotlight! I’d suggest newsagents place it with newspapers. Even include a bookmark noting it as an excellent Christmas gift for anyone who loves politics and or who loves Clive.

Written with wit and insight by Guy Rundle, this is a terrific read. I recommend it.

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magazines

It’s an Olaf Christmas

olafOlaf is the character people are loving this Christmas from what I can see. Whether it’s a plush item, a card, collectible POP! Vinyl or some other thing, if it is of Olaf, people love it. While the initial wave was kids who were into the movie, we are now seeing adults purchasing items, especially the collectible lines.

Identifying the multiple shoppers for an item can help you finesse your pitch through placement and through shopper dialogue.

We are making the most of the Olaf opportunity by ensuring we have good stock from a diverse mix of suppliers.

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Newsagency opportunities

Wonderful note from the author of The Drover

I received a wonderful note from Alice mavin, author of The Drover – a coffee table book I strongly recommend newsagents stock

My name is Alice Mabin and I am the author of The Drover. I was at newsXpress Beechworth today and Vaughan showed me the post you put on your newsagency blog.

I just wanted to say a huge thank you for your comments. I see you have a very strong following on the blog and your message really helped with my book sales leading up to Christmas.

It has been a real challenge but rewarding at the same time, to self publish and distribute my own book. The fact that bookshops have not stocked my book has been a bit of a blessing in disguise as it has made me think outside the box to promote and distribute my book and still make it a success.

The newsagents that have got behind it have been wonderful and have even been active in following through with the merchandising ideas I have given them to help with promotion.

Alice is supporting our channel with access to her book, autographed copies and retail support. Newsagents I’ve heard from say it is selling very well. This is a good Aussie story for us to get behind.

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Book retailing

Coles reminder on gift cards

giftcardsA visit to your local Coles is a good reminder about the placement of gift cards this time of the year. In one Coles I was in yesterday they placed gift cards at the main entrance – you could not miss them. This is an excellent reminder to newsagents to check where gift cards are placed – interrupt shopper flow, get them noticed.

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Newsagency opportunities

The best floor display unit of the year

tmstandI rate this Top Model floor display unit from TAG as the BEST floor display unit of 2014.

This stand is strong and well-branded and presents the products well. Better still, it works at driving sales.

We see many floor display units that do not serve our businesses well. This stand is so good we have a second coming to strengthen pour pitch for this very successful young girl brand.

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Newsagency management

Crossword magazine sales up 24% year on year

magscwOur crossword sales are up 20% comparing the last eight weeks with the same eight weeks a year earlier. This is extraordinary growth outside what is average for the newsagency channel.

My research suggests that the average year on year growth for crosswords in 2.5%.

I’d put our growth down to moving the category to a better vertically integrated fixture and our discount voucher loyalty program. The discount voucher basket data in fact shows extraordinary use of the vouchers for crossword titles.

Newsagents can grow crossword magazine sales through more proactive shop floor engagement and a genuinely rewarding loyalty program.

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crosswords

Extra early returns for Christmas

xtrareturnsI broke with tradition and did an additional sweep for early magazine returns yesterday, Thursday, because of space pressures as a result of unwarranted additional magazine supply and Christmas space pressures.

Outside of our usual magazine returns and a reasonable first pass at early returns, this  photo shows the additional early returns I pulled out of a desire to exert more control over my business yesterday.

The planned MPA magazine publisher  distributor code of conduct will not adequately address the oversupply situation nor will it address the uncompetitive nature of how magazines are supplied to newsagents versus our competitors. Until this is fixed, early returns are the only tool newsagents can use.

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magazine distribution

Making a splash for Dolly

dolly5I found room yesterday to display all five covers of Dolly for the next week at least. The covers look terrific placed next to each other.

We’re fortunate to have fixtures that make eye level full cover display achievable in the magazine department.

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magazines

How to grow Diabetic Living sales

dbtlI’ve found the best way to grow Diabetic Living sales is to place it with health titles plus weeklies and or food titles. It’s a magazine often purchased on impulse – hence the importance of location. This week we have it with That’s Life as it always does well from there.

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magazines

Promoting Frankie for impulse purchases

frankieWe are promoting the latest Frankie magazine with a half waterfall as well as an off location placement with a range of stationery we have for the Frankie shopper.

Having the full cover of Frankie on show to drives impulse purchases.

This bumper issue of Frankie looks stunning.

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magazines

Here’s how PayPal payments work in a newsagency

I was asked here a while back to show how PayPal payments work in a newsagency. This video shows the process – how a PayPal customer can pay thanks to newsagency software integration.

The real value of PayPal is that PayPal shoppers can find your business. This integration is as much about newsagency marketing as it is about streamlining shopper payments.

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Newsagency management

WH Smith impact on Australian suppliers and newsagents

As WH Smith extends its reach here in Australia, acquiring more retail locations through acquisition, some suppliers will see business impacted. New commercial partners will benefit while those who are not will not benefit.

I’ve heard of a supplier relationship that advantages one supplier over a competitor in an important specific channel. The supplier who missed out stands to lose significant revenue as a result.

A bigger group making decisions like this can have an impact on supplier businesses. The flow-on effect could be beyond direct WH Smith relationships.

This is another aspect to consider of the changes we are seeing in our channel here in Australia this year.

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Newsagency challenges

Magazine publishers need to be careful who they listen to

At a recent publishing event someone claiming to know was putting it about that newsagents were achieving a sell through rate of 50% for magazines.

The person reportedly saying this does not have access to data to backup the claim. I think it is their best guess. But they did not qualify it.

I see real sell through data for many newsagencies. While there are some with an overall sell through above 50%, there are many below. But this high level measure is unhelpful. The best measure is non weekly sell through as this is where newsagents are hurt the most.

Once I take out high volume weekly titles, the average magazine sell through I see for newsagents is close to 40%. That is, 60% of this stock fails to sell and is either recycled through the system at the newsagent’s expense or thrown out and wasted.

The MPA driven magazine code of conduct that is at the basis of a supply model trial with selected newsagents will not address this as the code does not go far enough. Replacing a failing title with another failing title allows a distributor to pass the code but fail the newsagent.

I want magazines I can sell. I’m happy for a 75% sell through – less than that does not work for me or the publishers I serve. The problem is that 75% does not work for the magazine distributors. hence the uncompetitive supply model forced on newsagents.

Yes, I hear you …  blah blah blah – nothing new here. That’s true. But I feel better for writing it.

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magazine distribution

Gordon & Gotch magazine fail #3

image[5] copyYep, the same newsagency as the last two, this time it’s TAN UNRESTRICTED. With no sales achieved from issue 54 through to issue 64, the Gotch magazine allocations experts have decided the newsagent needs to go from five copies to eight copies. This would be laughable if it was not so harmful to the business.

And you wonder why newsagents are getting out of magazines.

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magazine distribution

Cool Dolly cover series

dolly5Kudos to the folks at Dolly for their five different covers on the One Direction members. It’s a brave move. We have done what we can to show off the five covers but can’t devote enough full face pockets to have all on show at once. One Direction is not driving sales as it used to – calendar sales are the best indicator of that for me as I have good data.  Calendar sales laid out against first week’s sales of their latest album compared to their previous three shows that while the band remains popular, that popularity is not translating into the sales they used it.

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magazines

Are discussions under way on the next WH Smith acquisition?

I have heard from three suppliers in the last 24 hours that UK retail group WH Smith is in negotiation with an Australian newsagency group to acquire franchisor management control of that network and add it to its rapidly growing portfolio. We know from recent acquisitions that WH Smith prefer the franchise model over corporate stores.

If the reports lead to an acquisition, it will shake up the channel and considerably challenge several key newsagent suppliers.

I don’t have confirmation from the group so I will not name them here.

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Competition

Collectors are valuable newsagency shoppers

bbbearCollectors are a valuable customers – the challenges are discovering what they collect and understanding them. This was brought home to me last week when I delved into the world of the Breaking Bad collector, the world of someone who will purchase items related to the show and the knowledge they have about what they collect.

Take this pink teddy from Breaking Bad. It’s a sad looking thing but it is sought after by Breaking Bad fans. If you had it in your plush department people would think it’s damaged stock. If you put it on a pedestal under a spotlight, Breaking Bad fans would recognise it. Many would have read the history of the bear online, they would know that it is more than a bit player in the Breaking Bad TV series.

Thanks to the support from several specialist suppliers, engaged newsagents have access to products like the pink teddy bear that cater to TV show fans, band fans and collectors of other items.

I know through my involvement with the collector strategy of the newsXpress newsagency marketing that there is also considerable support to help newsagents to get into and make money from the collector space.

With a serious collector spending between $1,500 and $3,000 a year on their collection (of any sort), being able to serve them depends on product knowledge, good supply and smart shop floor engagement.

This is that the pink teddy bear represents – a lesson in the value of collectors and the role they can play in some newsagencies in unlocking new traffic for the business.

It’s hard work serving collectors. You need to step into their world of obsession. You need to understand their interests. You need to respect them. You need to enjoy their excitement at new products they can add to their collection. So, yes, it is hard work … and very rewarding personally and business wise.

This is what selling to collectors is about, knowing

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Newsagency management

Amazing Lego Christmas display

legoxmasOn Pitt Street Mall in Sydney is an amazing Lego Christmas display, standing tall and drawing families tas it lights up and Christmas music plays.

This is an inspiring pitch for the Lego brand. I saw kids loving the music and lights and adults in awe of the construction using Lego bricks.

The display reinforces the strength of the Lego brand and the value of a big display in attracting people.

Click on the image to see the bricks.

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visual merchandising

Advent calendar overload

adventoverloadFor years advent calendars were challenging to find. Today, we are swamped. In one shopping centre this week I saw them in supermarkets, discount variety stores, confectionery shops, newsagents, gift shops and even at the fruit shop.They all had boxes of them – many featuring licenced brands … and most were discounted. What was once a specialist retail line you could enjoy a good margin from is now another oversupplied line you will be lucky to break even on.

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Newsagency management

Excellent branding and placement leverages traffic

ksThis Kinder Surprise display at the front of the Woolworths supermarket on George Street in Sydney is terrific. There is no missing the Kinder Surprise branding as you enter of leave the store through the main entrance. Kinder Surprise owns the space. From the detail on the floor units to the large posters, this is a consistent and clear message.

While I expect there supplier would have paid for the space and had professional merchandisers create the display, the photo offers us inspiration for our local newsagencies, inspiration to give over key traffic space to a single brand that will interest our shoppers.

While many newsagents do excellent displays, they are often done on a small scale and end up fighting for attention in a visually busy shop. The approach in the photo shows the value of giving space reserved for multiple displays over to a single brand.

Click on the image for a larger version.

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retail

A reminder that colour blocking works

zumbo-macaroonsNowhere is the value of colour blocking more obvious than in the display at Adriano Zumbo’s kiosk at the QBV centre in the heart of Sydney. You can see people notice the colours of the display. It’s effective because of the colours they place next to each other. The same product arranged differently, may draw fewer people … it all comes down to effective colour blocking. Getting this right can draw people to anything. For good advice on colour blocking check out the advice from Apex display.

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Management tip
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