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

Author: Mark Fletcher

How the newsXpress newsagency marketing group is helping newsagents transform in 2021

Yes, to some this will read like a marketing pitch. They would be right, in part. But, it is more than that. I share this information here to show that there are newsagents doing well, transforming their business, leveraging intellectual property top grow profitability, and through that, business value.

This is the story in 2021 about our channel, the extent to which newsagency businesses are thriving. I can speak to the newsXpress experience because of my direct involvement.

See for yourself. Click here to access a new 49 page book published outlining in detail what newsXpress offers.

Already in 2021, newsXpress has delivered valuable and exclusive benefits:

  1. A data driven greeting card strategy that has delivered 25% and more year on year card sales growth to retailers who have engaged.
  2. A bonus 5% gross profit from more than 50 preferred suppliers – real bottom line benefit. Funded 100% by newsXpress. For all orders from April through June 2021.
  3. A new marketing video service delivering personalised videos for your business, which you can use on social media.
  4. 100+ new social media posts ready to use to freshen your social media feed.
  5. Ten new product supplier videos shot exclusively for newsXpress members, sharing insights into how to find and sell to new customers.
  6. New suppliers offering access to new traffic generating products usually not available to newsagents.
  7. A lower monthly membership fee.
  8. Half price Shopify website. Provding access to a beautiful, personalised, business website for your business connected to the Tower POS software.
  9. First to market insights for toys, helping our members better tap into this lucrative product category.
  10. A creative writing competition attracted plenty of entries and helped people see newsagencies differently. We funded the $2,000 in prizes.
  11. A Mother’s Day art competition is already attracting wonderful entries.

Best of all is the optimism for a bright future these and other developments nurture.

Footnote: I am a Director of newsXpress Pty Ltd

9 likes
newsagency marketing

Customers reacting well to QR code check in vigilance

We have seen an increase in compliance with QR code check ins in-store. While compliance was okay before, it is even better now thanks to clearer media reporting.

This photo is a table on the lease line. We have a secondary point in-store as well as QR code posters at the counter.

While we chose to use government collateral, some nearby retailers made their own, and the message gets lost.

2 likes
Social responsibility

Are Media to acquire Ovato magazine distribution business

Announced this morning:

Sale of Retail Distribution (Australia and New Zealand) to Are Media Limited 

Ovato and Ovato New Zealand Limited have entered into a binding sale agreement to sell the entire issued share capital of each of Ovato Retail Distribution Pty Ltd and Ovato Retail Distribution NZ Limited (together, “Retail Distribution (Australia and New Zealand)”) to Are Media Limited (“Are Media”) (the “Transaction”). 

The consideration for the Transaction comprises a headline purchase price of A$15 million in cash and the acceptance of a negative working capital position of approximately A$27 million. 

Are Media is a 16.4% shareholder of Ovato and is accordingly a substantial holder in Ovato for the purposes of ASX Listing Rule 10.1. Therefore, shareholder approval will be sought for the Transaction to comply with ASX listing rule requirements. Ovato intends to dispatch a notice of meeting in relation to the Transaction mid-June 2021, with the meeting to be held mid-July 2021. 

The major shareholder of Ovato, the Hannan family, who collectively hold 43.4% in Ovato, has indicated its support for the Transaction and intends to vote any shares it holds in favour of the Transaction at the proposed shareholder meeting. 

Ovato has engaged an independent expert, Lonergan Edwards & Associates, to determine whether the Transaction is fair and reasonable to Ovato shareholders who are not associated with Are Media. 

Subject to the satisfaction or waiver (as applicable) of the conditions to the Transaction (which include customary regulatory approvals), it is currently expected that the Transaction will complete by the end of July 2021. 

Put option to sell Marketing Services (Australia) to Ballygriffin Holdings Pty Limited 

Ballygriffin Holdings Pty Limited (“Ballygriffin”), an entity owned by the Hannan family, and Ovato have entered into a binding put option deed under which Ovato could require Ballygriffin to acquire the entire issued share capital of Ovato Creative Services Pty Ltd, Ovato Technology Pty Ltd, Ovato Communications Pty Ltd and Ovato Creative Services Clayton Pty Ltd (together, “Marketing Services (Australia)”) for A$9 million. 

Ovato Limited – ABN 39 050 148 644 

Shareholder approval will also be sought for this transaction to comply with ASX Listing Rule requirements. 

Ovato has engaged an independent expert, Lonergan Edwards & Associates, to determine whether the entering into the put option deed is fair and reasonable to Ovato shareholders who are not associated with Ballygriffin. 

It is expected that the timing of the shareholder meeting will be similar to the Transaction referred to above. 

Change of CEO & Managing Director 

Kevin Slaven has advised the Ovato Board that he will not be seeking an extension to his current contract which expires on 17 September 2021. It has been agreed with Kevin that he will step down as CEO & Managing Director and remain in the business until the end of June to assist with the business sales and to ensure an appropriate handover. 

James Hannan, currently Chief Operating Officer with over 18 years’ experience in print operations and senior executive responsibilities since 2014, has been appointed as the new CEO & Managing Director effective immediately. James, whilst responsible for the Group’s operations, also played a pivotal role in the successful negotiations with all stakeholders through the recent recapitalisation and restructure of the business and is spearheading the non-core assets divestment program. James will be very ably supported by existing members of the leadership team. The key terms of James’s employment contract are disclosed below. 

Michael Hannan, Chairman, says “The challenges of the industry over the last decade were further exacerbated by COVID-19. In response, the business will bring its focus back on print, the core of its operations. It will allow focus to be placed on a strong, viable and profitable printing business in Australia and the ability to invest in new technologies to support print. The sale of the Retail Distribution and Marketing Services businesses will greatly assist in providing Ovato with cash reserves for ongoing transformation and will be the catalyst for a significant flattening of the corporate costs starting from the top with immediate savings being realised by not replacing any departing member of the leadership team.” 

Referring to the change of CEO, Michael Hannan says “The Board recognizes the role that Kevin has played in a very difficult period for the company since being asked to take the reins unexpectedly in late 2017. He has addressed the challenges completing a very complex merger of two of Australia’s largest print businesses; IPMG with PMP, followed by a significant operational and corporate restructure to right size the business required by market conditions and the COVID-19 impacts. 

The Board wishes to thank Kevin for his guidance and leadership through this difficult period, and for his loyalty and dedication to the company. We wish Kevin well in his future endeavours.” 

This announcement was authorised for release by the Board of Directors of Ovato. 

I predicted this when Are Media first acquired a stake in Ovato. To me, it made a logical next, step move.

1 likes
magazine distribution

Coles vs. newsagents

This is one of the weirdest videos I have seen. It was uploaded to YouTube a few days ago. In it, the presenter compares packs of AFL collector cards purchased from Coles compared with the same products purchased from a local newsagency. While the video is weird, it is weirder that it has had 995 views already.

Don’t judge me for finding this. I was looking for something else and found this. Seriously odd.

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Uncategorized

National donut day

Today is national donut day and, yes, it’s a day created solely for commercial purposes, like some other days from which our channel benefits.

Anyway, we celebrated early at the office yesterday.

 

 

 

 

 

 

These locally made donuts were a delicious treat, a reminder that having fun is good, and tasty.

2 likes
Fun

Invitation to all newsagents

Invitation: June 8 @ 10:30am, online.

I write to invite you to a free Zoom meeting at which I and some of the newsXpress team will share with you the EXCLUSIVE TO NEWSXPRESS data-driven process that has resulted in successful newsagencies growing card sales by between 25% and 75%. Yes, those percentages are real.

newsXpress has developed intellectual property that it uses to guide in-store card changes, based on the sales data from that store.

At this free workshop, I will show you actual results, which you will be able to verify. One of our newsXpress team members will step you through the work involved to achieve the results. Often, we are achieving excellent results with no capital spend.

We will show you the most comprehensive card performance reporting you will see for any card retailer in the world. I understand that is a bold claim. Once you see what we will show, we think you will agree.

Join us June 8 @ 10:30am if you want to grow your card sales. Here is the link:

https://zoom.us/j/98961647990?pwd=cy9wdnllL1JqYlFyUDdkR1FISlFrUT09
Meeting ID: 989 6164 7990 Passcode: 519968

In the meantime, if you have questions, please email help@newsxpress.com.au.

Yes, I am a Director of newsXpress

4 likes
newsagency marketing

Time for an EOFY sale

The next few weeks provide an excellent opportunity to bring out everything you want to quit to the front of the store under the banner of EOFY SALE.

Let it go as the song says, quit the stock with prices that will see that achieved in days, not weeks.

EOFY is the one time when copying big retailers makes sense. You can ride the noise of their ad campaigns re EOFY.

Keep it simple: no pretty displays, this is all about a price offer, front of store, to attract people who are walking past.

1 likes
Newsagency opportunities

Learning from Officeworks product placement

That space as you head toward the counter is premium in any retail business. So, too, is the counter itself … but today I want to focus on the space close to the counter, as the customer approaches it.

Officeworks have been getting this space right for a while now, placing impulse lines there that are easy to pick up. It is their product adjacencies that are particularly smart.

Take this example of art supplies. They have a bunch of items together that could see a parent or other relative pick up several items to make for a nice gift for a kid.

This photo shows items three or four steps from the counter. No need to shop the shop, move between different locations, all you need is there.

There were more items than I caught in this photo.

I like this mix of products as it shows what’s possible at or near the counter. For too long in our channel we focused on low price, convenience lines. While some in our channel are having success with more expensive items at the counter, most continue to play in a more traditional way in this space.

Taking a look in-store at an Officeworks store and their counter related pitch could be useful.

2 likes
Newsagency opportunities

The important role of small business retail front line team members during the Covid lockdown

Thanks to a failure in hotel quarantine in South Australia, a failure of the federal government in terms of quarantine and a failure of the federal government on the Covid vaccine roll out, Victoria is in the middle of a 7-day lockdown, to try and suppress transmission of a particularly virulent strain of Covid.

Okay, blaming aside, this lockdown has shown, again, the important role small business retail front line team members play in our communities. This is especially true in newsagencies.

For people living alone or caring for someone at home, the interaction at the counter is important. Over the last few days there have been several examples I have witnessed of this, where shoppers talk for a bit longer, soaking up the interaction. Our shops are hubs for this warmth.

Good retail team members spot the need and provide interaction that is encouraging and helps the customers feel better than when they arrived.

What’s been happening in newsagencies in Victoria over the last few days is a reminder of the importance of local small business retail in communities, the role we play, the support we provide.

I am writing about local small business retail as it is in that setting that shoppers are more likely to have a personal and nurturing experience. Our local small businesses are less focussed on KPIs, interactions are more authentic than the corporate national retailer dictate of the five rules of every customer contact or whatever corporate rules the staff are told they must follow.

The warmth and genuineness of the interaction in a local high street newsagency setting is helping plenty of Victorians through this latest lockdown. Our channel can be proud of the role we play on the front line, the role we play in the mental health of so many who visit our shops.

If only politicians would take a moment to see first-hand the role local small business retail plays in the community in situations like this. There are retailers in our channel who do more good in a week of customer interactions than a year of words press releases, announcements and doorstops from any politician, especially federal politicians who love a big announcement but fail at the action.

Kudos to all newsagents in Victoria who have been open through the lockdown and who have provided extra care at the counter to customers keen for personal contact and support.

24 likes
Social responsibility

Late newspapers … ouch

6 likes
Newspapers

Like Christmas

Trading in my own shops in Victoria yesterday had a Christmas-like feel to it, because of the lockdown coming into effect from late yesterday here in Victoria.

Shoppers brought forward purchases of cards a gifts. Jigsaws, candles, crosswords and other nesting items sold well, too.

It was busy, right up to the later close.

Even though we will remain open through the lockdown, most of the other shops around us will be closed and, as happened previously in indoor shopping centres, traffic is way down.

So, yes, yesterday was a good day, a really good day, and for that I am grateful.

3 likes
Newsagency opportunities

Magazines moved to the back of Coles

A popular and successful Coles supermarket in Melbourne has moved magazines and cards to the back of the shop. Whereas previously they were at the entrance to a busy aisle, near the entrance to the self checkout area, they are now located at the quieter end of an aisle.

I am not sure if the moves reflects a store specific decision of a Coles supermarket fleet decision. It will be interesting to see. This Coles also has no representation of magazines at any checkout lane.

Where newsagents place magazines is an on-going discussion within our channel. Flat and falling sales, low cover prices and a meagre margin mean we have to take other steps to try and reach a form of viability.

1 likes
magazines

Customers say the funniest things …

newsXpress stores were offered access to two limited mintage coins celebrating the Queen’s 95th birthday. The available allocation was taken up quickly. Then, a few days ago, the coin was withdrawn. It never left the mint, not only for newsXpress but for all retailers. We don’t know why. But, we had to communicate its unavailability to retail customers, coin collector customers.

Here is a terrific story from one newsXpress member and their interaction with a customer …

Was talking to one of our regular coin collectors today when the subject of the Queen’s coin recall came up. Innocently I said ”I wonder why”. Well, you hear it hear first folks – ”It’s because the Queen has been dead for 10 months!” AND he also informed me that Prince Philip has been dead for 5 months (that one I couldn’t dispute because he looked like death warmed up for quite some time). But it all has to do with the economy you see. I did not hear much more of what he said because all I could think of was ‘A Weekend at Bernie’s’. You’ve gotta love retail 😂

I agree, you’ve gotta love retail!

3 likes
Fun

Newsagencies are good businesses to buy right now, popular, too

Newsagency businesses are selling quickly in today’s business market. They are popular in part because they had a good Covid, in part because of the relative certainty of revenue and in part because of the opportunities of change.

Newsagencies are seen as being a safe investment, because of the multiple options and opportunities for driving value from the investment.

I’ve seen businesses sell within a few days of going on the market – city and country.

This is great news for those in our channel keen to sell their businesses. It is also great news for people looking to invest in our channel.

We are in the midst of a kind of renewal in the channel. New capital, fresh energy, fresh ideas. This is all good for the channel.

What we are also seeing is more change in the channel, less cohesion as to what a newsagency is, and that’s okay.

There’s the core of papers, magazines, cards, and lotteries for most but not all. Outside the core we are seeing more engagement in more recent categories like homewares, niche gifts – not the usual low cost imported gifts but higher price point, locally made and less likely to be in mass retail.

So, it’s good news for newsagents selling their businesses and good news for people joining our channel by buying a newsagency business.

Like any business investment, you get out of it what you put in outside of the money itself, the strategies, energy, mood and embrace of change. It’s terrific seeing some of the fresh ideas coming with new business owners.

Yes, now is a good time to buy a newsagency business. There are good businesses for sale and plenty of opportunities for leveraging growth through them, and therefore a good return on your investment.

Now, before people get in a lather and say the old newsagency is dying, I agree. That purely old newsagency model that relies on legacy products is significantly challenged. But, plenty of older style newsagencies are doing well. These businesses present opportunities to evolve into new traffic and revenue models.

I have written the above because of some who comment here who have sold or closed their newsagency businesses and talk down the channel of which they are neo longer part.

10 likes
buying a newsagency

Henderson Greetings wins Bluey card contract

It’s good to see the primary licence for the design, printing and distribution of Bluey greeting cards go to an Australian company.

The folks at Henderson have every right to be proud. This is a big endorsement for the company with the Bluey licence a prize I am sure many chased.

The range of cards and gift packaging are an excellent representation of the Bluey brand.

I am grateful to have seen the Bluey cards first-hand, under embargo a week ago. From the design to the production, these are good cards, really good cards. Excellent quality. Wonderful and engaging design. Themed envelopes. And, a counter unit perfect for impulse purchases.

I am sure those receiving the Bluey cards will want to keep them. I also expect some cards will be bought by collectors – not even to give.

With the cards being available in-store from mid next month, newsagents have an excellent opportunity for in-store engagement, including a launch not only of the cards but of kids items that could sell to Bluey card companies. That’s what we are planning in my own shops – an in-store event around the release of the cards.

This is an excellent mid year in-store promotion opportunity presented by the release by Henderson Greetings of the Bluey licence cards.

11 likes
Greeting Cards

Regional / rural newspapers far from dead

The Conversion recently published a terrific report on the results of a comprehensive survey of 4,200 country newspaper readers.

Newspaper readers in rural and regional Australia are five times more likely to go directly to their local newspaper website than Google or Facebook for local information, and almost 10 times as likely to go to their local news website over a council website for news and information.

Nearly two-thirds of local newspaper readers also indicate policies affecting the future of rural and regional media would influence the way they vote at the next federal election.

These are some of the key findings of a national survey of almost 4,200 Australian country newspaper readers we recently conducted as part of a project to drive greater innovation in the rural and regional media landscape.

The report is worth reading, especially if your business is in regional / rural Australia as to reflect the value association with newspapers in these locations, value documented in the evidence of this professional and thorough research. The results are especially supportive of print:

Many respondents expressed resistance to their newspaper being made available in digital format only. They offered comments such as:

There is always room for improvement, but if this newspaper went digital, I would not be interested.

And this from another:

The day it goes digital only will be the day I stop reading it.

Our survey also found that respondents overwhelmingly (86%) view a printed copy of their newspaper as an essential service for their community.

Newsagents already know the value of local independent newspapers. They see it in their shops.

I guess what’s interesting to me is the growth in this space on the back of News Corp. closing so many of their local papers last year.

4 likes
Newspapers

Promoting throw rugs online

Further to my post from a few days ago about success with throw rugs versus magazines, here is an example of what we are doing on social media to pitch the rugs. This is one of a range of posts. The posts work because we have customers coming into the shop and asking to see the rugs.

2 likes
newsagency marketing

Focussing on self care in the newsagency

We have been pitching self care on the lease line in one of our Westfield centre businesses. It’s working a treat.

This multi-category pitch is attracting shoppers and purchases. Coming out of Mother’s Day with this has worked a treat as it appeals to a comfort people have sought through Covid and a comfort that is familiar in Winter.

You know a pitch is working when you have to refresh the products on offer regularly.

3 likes
marketing tip

What is the new normal?

It seems we have been asking this since Covid really kicked off early last year.

The thing is, the question what’s the new normal (or similar words) keeps evolving.

In early 2020 it was about a world dealing with Covid. Then, as 2020 progressed, it was about Australia doing pretty well. Then it was about a vaccinated world. Now it is about a vaccine challenged world and the realisation that it will be years for the world’s population to be vaccinated.

It’s on my mind today as this week I have had a number of meetings with business people who have been asking the question. In big businesses, it is the question being asked and explored.

Thinking about the discussions with people this week from banking, national product suppliers, national retail landlords, insurance and business strategy consultants, the collective view is that big employers of office workers have reset their view of work – where it needs to be undertaken, when it needs to be undertaken and even by whom.

I know I have written about this topic before. Today it’s a bit different in that today I am reflecting on what people from major businesses have told me. Whereas six months ago most were expecting a return to what was, not all of the ones I have spoken with expect that now.

A senior person in a national retail tenancy business they are recalibrating their tenancy mix because of what they see as a long-term shift.

The insurance person said that in their case hundreds if city based employees they expected to return to the office will now permanently work from home. Less than six months ago this was not their expectation.

This is good for regional, rural and high street businesses as it keeps more people closer to those situations.

Yes, there is a huge challenge for CBDs and office tower reliant businesses. But, that’s for the. to consider.

Smart small business owners and local councils are embracing opportunities for the shift. I am seeing employees, too, embrace the shift. One of my businesses has run a couple of ads recently for new roles and the mix of people applying has changed since the roles are offered for remote engagement with more flexible hours because of this. We have a deeper and more interesting pool from which to choose and many who applied have themselves transitioned from office based work to home based, often more regional, work.

It’s this core sustained economic shift that is interesting to me and it is in this space that I think businesses, like local newsagencies, can better play.

The slow vaccine uptake in Australia coupled with the realisation that vaccinating the world’s population has big challenges and what this means for the level of international tourism we are used to and the impacts, too, on immigration all play into economic growth on which businesses big and small rely.

I know many in our channel are seeing and leveraging the shift now. My suggestion is do even more, really lean into the opportunity and be a retail leader into the opportunity … because the opportunity, I think, is bigger and more sustained than you currently think. That’s my take away from. discussions this week.

9 likes
Newsagency management
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