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

Author: Mark Fletcher

A quiet Valentine’s Day in Melbourne

I have been to my shops today, to see first hand what this new Covid lockdown looks like for Valentine’s shopping.

The Westfield shopping centre car parks were 95% empty. despite our shop being the only card outlet open, trade has been okay but not flash.

On the high street, as you may expect, it has been a usual pre-Valentine’s Saturday – good sales, plenty of shoppers.

Talking with some other Melbourne newsagents today, their experience has been the same.

I suspect things will have been more normal in regional Victoria.

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Social responsibility

It’s a mistake to promote lotteries on social media

Why? Because it defines your business to others.

Okay, you may want that. if so, by all means promote lotteries on Facebook.

However, if you want to bring on a new supplier and they check your business out, be prepared for them to say no to you because you are a lottery shop. Yes, they judge you that way.

Also, the Facebook algorithm will restrict you sees your site based on lottery advertising.

If you have been doing it, is there any evidence that it boosts your sales? I have not seen any.

While I am not a lottery retailer, my opinion is it’s not worth promoting lotteries on Facebook.

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Lotteries

Newsagents can be open during the 5-day lockdown announced for Victoria

Following the model from last year and the situation, then, that saw retail newsagency businesses classed as essential, newsagency businesses in Victoria can be open over the next five days. Lottery kiosks and tobacconists cannot remain open. Now, for newsagents in Victoria  …

  • Employees should have a permit provided by the business with them to and from work.
  • Ensure you have ready access to masks for staff and customers.
  • Hand sanitiser at the entrance to the store and at the counter.
  • Sanitise the counter on both sides regularly.
  • Pitch curbside pickup for shoppers.
  • Offer local delivery for shoppers.
  • Be positive on social media.
  • Front of store product focus: games, jigsaws, candles, self care.
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Social responsibility

A new online workshop: Taking your newsagency online: a dive into newsXpress national and local store websites.

Taking your newsagency online: a dive into newsXpress national and local store websites.
Tuesday, Feb. 16 @ 2pm Melbourne time.

Tuesday next week, at 2pm, I am hosting a new free workshop for any newsagentinterested in taking their newsagency business online.

This session will look at this topic from the context of what newsXpress does and has done for 5+ years. We will look at the national sites and the local store sites:

  • How to generate online traffic for national and local store websites.
  • The cost of fulfilling sales.
  • How local stores setup for efficient fulfilment.
  • Managing freight in terms of lowest cost to execute as well as decision making around the free freight question.
  • What being online has meant for in-store purchases.
  • Repeat business prospects.
  • How to use online for first to market opportunities.
  • How to be sure quantity on hand data is accurate.
  • This will be a genuine behind the scenes look.

I am doing this new session using newsXpress national website and local store website examples because I have good data and personal experiences I can speak to. You can rely on this information to make more informed decisions yourselves at the local store level as well in the context of any group you are part of.

newsXpress was the first marketing group in any retail channel in Australia to deliver local store connected websites with a live quantity on hand data feed. The learnings have helped other groups step into this. lucrative space.

This will be an online session, which you can access from anywhere with this link:

https://zoom.us/j/97889421359?pwd=R2puem9RWUVFS1lFTStXMjNHMzRIdz09
Meeting ID: 978 8942 1359 Passcode: 791972

I won’t be trying to sell you anything in the session. Rather, I will share experience insights, lay out the steps involved, discuss online platform options and answer all questions.

And, if the 2pm timing does not work, let me know and I will do my best to schedule another session at a time that suits.

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Newsagency management

How we achieved $388 in sales to one customer this morning in our suburban newsagency

This true story happened this morning at my Mount Waverley newsagency.

A new customer visited and made a modest gift purchase. On the receipt was a discount voucher for $4.00, which was pointed out to them.

They left the store and returned a few minutes later and made another purchase.

Then, twice more, they left the store and returned a few minutes later and made another purchase.

Over the course of four transactions they spent $388.00 for which we gave away around $30.00 in discounts, which is small when you consider the margin we achieve with gifts

The voucher guided them to look beyond their destination purchase.

here is a video I shot late last year in which I explain the vouchers some more. What happened today at Mount Waverley is not unusual. It’s another way we can grow our newsagency businesses.

This is a good example how a systematic approach to managing loyalty can. drive sales. There was nothing extra special about the approach in-syore. In reality, the software did the heavy lifting, calculating the discount opportunity and including this on the receipt.

It’s a thill seeing it work so well, work in different tilting the business.

In our Mount Waverley retail setting we compete with several gift shops. Plus, we have Chadstone less than 10 minutes away. Every win we can make is worth it to this small suburban retail newsagency.

While it was key we had products they wanted or were likely to want to purchase in the next few weeks, it was the practical opportunity of saving that mattered in making the $388.00 in sales a reality.

Any newsagent can do this.

While the Tower newsagency software was first newsagency software to offer discount vouchers back in 2013, others do now so newsagents with other software could have the type of success I have described here.

My point is – we all need to structure our businesses for these wins based on differentiation of our offers through smart loyalty marketing in businesses with broadly appealing gifts.

It’s good news and another example of small steps combining to create a good commercial outcome.

Whereas in the past we’d letterbox flyers and advertise in local papers. Today, using tech, we can guide greater efficiency from shoppers, maximising the opportunity.

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Newsagency management

A word of warning re $2 card spinners

Some card companies push $2 card spinners aggressively to newsagents, claiming excellent sales numbers.

My advice is ask for the evidence, ask for more than the anecdotes of sales people. Anecdotes are easy. Evidence does not lie.

Looking for data in one newsagency recently, a $2 card spinner generated 15% of greeting card GP whereas a smaller, less stock heavy, spinner generated 16% of greeting card GP. Considering the space and carry stock weight, the second spinner is the better investment for the business.

Sure, $2 cards give you a product with which you can compete with discount variety stores. To me, the big question is do I want to compete with discount variety stores? My answer to that is no … because if I do so, I set shopper expectations in a way that means selling gifts priced at $200 and more is challenging.

I get that sales reps are paid to sell. The thing is, that puts their needs ahead of yours. Data is key. In all the data I have seen from newsagencies for years, cheap card spinners, like $2 card spinners, do not serve newsagency businesses well. There are far better uses of floor space and inventory investment.

This all comes back to Blue Ocean Strategy. Swimming in the blue ocean is more enjoyable, healthier and valuable. Swimming in the red ocean is bloody. For me, $2 cards are a red ocean product.

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Greeting Cards

Newsagency sales benchmark results: Oct – Dec 2020 versus Oct – Dec 2019

Based on sales data covering October through December 2020 and 2019 from 156 newsagency businesses across Australia in city and country locations, high street and mall, the latest newsagency sales benchmark study is revealing as to the impact of Covid on our channel and the value of location.

Revenue surge in Australian newsagency businesses during Covid.

Most too successful to qualify for JobKeeper as sales of some traditional and key new product categories surge.

  • Gifts lead the revenue surge.
  • Toys, games and jigsaws experience double digit growth.
  • Magazine sales grow.
  • Regional newspaper closures do not hurt business performance.
  • Shopping centre newsagencies down, against the trend.

Let’s dive deeper into the results. This round of the benchmark I look at regional and city high street businesses. I have not broken out shopping centre businesses because the dataset is too small. The results from those stores for the quarter, however, are bleak.  Revenue down between 15% and 20%. Steep declines in magazines and newspapers. While some categories, like gifts did okay, performance was nothing like on the high street.

Regional high street businesses.

  • Transaction count change: down 1%.
  • Revenue change: up 11%.
  • Basket size change: up 15%.
  • Newspaper unit sales: down 10%.
  • Magazine unit sales: up 5%.
  • Card revenue: up 7%.
  • Stationery revenue:  up 9%.
  • Gift revenue: up 35%. 75% of businesses report selling gifts.
  • Toy revenue: up 25%. 10% of businesses report selling toys.
  • Puzzle revenue: up 35%. 20% of businesses report selling puzzles.
  • Instant lottery revenue: up 16%.
  • Lottery revenue:  up 4%.

City high street newsagencies.

  • Transaction count change: up 2%.
  • Revenue change: up 7%.
  • Basket size change: up 10%.
  • Newspaper unit sales: down 8%.
  • Magazine unit sales: up 2%.
  • Card revenue: up 7%.
  • Stationery revenue:  up 6%.
  • Gift revenue: up 20%.
  • Toy revenue: up 15%.
  • Puzzle revenue: up 18%.
  • Instant lottery revenue: up 18%.
  • Lottery revenue:  up 3%.

The gift percentages above do not tell the full story. There are some newsagencies that achieved 200% growth off a reasonable base in 2019 of $25,000 in gift sales. Also, there are some newsagencies that booked $200,000+ in gift revenue for the quarter.

Within gifts, homewares are surging with some newsagencies booking more than $25,000 from this segment alone in the quarter. fashion, too, is surging with some recording more than $15,000 in revenue from a segment that the year before contributed $0.

In terms of cards, there are some newsagencies reporting 40% and more growth. This has usually come about through significant shop floor and supplier related adjustments.

Note. 

These are averages. The gap between those doing well and those not doing well is considerable. It is important that newsagents look at their own data as the most important competitor they have is themselves. The trading period from the past against which you compare results is your competitor. Look at those numbers more carefully than you look at these benchmark results.

What have we learned from the last 3 months?

  • There is much good news here.
  • People prefer the high street over shopping malls.
  • There is a feeling that the card shopper community has grown … more people are sending cards.
  • The newsagency channel is healthy.
  • The best growth is coming from categories over which newsagents have the most control – gifts, homewares, toys, games, puzzles, collectibles.
  • Diversification in newsagency product offering is key to success.
  • Having an online presence drives revenue growth.
  • Postable gifts are selling well.

I am grateful to all newsagents who shared their data for inclusion in this study.

Mark Fletcher.
Email: mark@towersystems.com.au  Website: www.towersystems.com.au  Blog: www.newsagencyblog.com.au
M | 0418 321 338

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Newsagency benchmark

Taking your newsagency online workshop today @ 2pm

Today at 2pm, I am hosting a free workshop for any newsagent interested in taking their newsagency business online.

This, itself, will be an online session, which you can access from anywhere with this link:

https://zoom.us/j/91031390280?pwd=LzFKYXFqdVJueS9iNWhNbWRJUndBUT09

Meeting ID: 910 3139 0280 Passcode: 323615

I won’t be trying to sell you anything in the session. Rather, I will share experience insights, lay out the steps involved, discuss online platform options and answer all questions.

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newsagency of the future

Are newspaper promotions not as important as they used to be to some in circulation?

Back in the day when a promotion like the latest book offer from News Corp. was launched there would be advance information, including to software companies – so newsagents could land the offer in their business with the right data management processes to ensure efficiency and maximise the opportunity.

No more.

This book offer from News Corp. this past weekend, ahead of a price rise slipped in unannounced, leaving newsagents and newsagency software support people dusting off previous advice late. It was okay in that previous advice worked. That’s not the point though. Some newsagents, especially some new newsagents, were unnecessarily stressed because of poor comms from the publisher.

The weakened circulation management infrastructure in capital city newspaper publishing offices results in less support for offers like this and less engagement in newsagencies.

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Newspapers

A very different Toy Fair this year

The folks organising the Toy Fair have, in my view, done a better job of dealing with Covid trade show challenges than reed and AGHA. They called it early and decided on a digital trade show, rather than leaving the decision to the last minute. back in November they made the decision and advised the marketplace.

Being digital, more newsagents can attend and engage with this vital category.

Here is a terrific video from them pitching the fair and explaining how it will work:

Great leadership on show from the board of the ATA.

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Newsagency opportunities

Why we are likely to have fewer newsagencies in major shopping centres in Australia

Covid revealed a vulnerability of major shopping centres that attract crowds, a vulnerability that remains on show today, in February 2021.

Whereas shopper traffic in high street retail is at pre-Covid levels and, often, ahead, in shopping centres traffic remains flat in some and down in others.

Try and they might, major landlords are struggling to attract the numbers of pre-covid, and this is impacting retail, especially small business retail. this brings me to newsagency businesses.

More traditional newsagency businesses rely on the habit based shopper. A certain number of this type of shopper has found satisfaction elsewhere, outside of major centres.

I think this is a factor in some of the shopping centre newsagents I know looking for space outside. I am one of those.

With major landlords unwilling to reset occupancy cost – yes, they are pushing increases, not offering decreases – the value proposition considering the lower traffic is not there. Something will have to give from landlords if they want newsagencies to remain. However, I suspect they are not as interested in the newsagency channel.

There is appeal for kiosk based lottery outlets. However, with supermarkets covering basic magazines, cards, newspapers and stationery, our shingle is not the must-have it once was. I have no issue with that. My concern is for newsagents who feel they must be in a centre and end up agreeing to a higher occupancy cost.

Having traded pre and through Covid in high street and shopping centre situations, there is no doubt that for the medium-term, high street has a far greater appeal, because of the return that can be achieved through the control you have.

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Newsagency management

Workshop: taking your newsagency online

Tuesday next week, at 2pm, I am hosting a free workshop for any newsagent interested in taking their newsagency business online.

This, itself, will be an online session, which you can access from anywhere with this link:

https://zoom.us/j/91031390280?pwd=LzFKYXFqdVJueS9iNWhNbWRJUndBUT09

Meeting ID: 910 3139 0280 Passcode: 323615

I won’t be trying to sell you anything in the session. Rather, I will share experience insights, lay out the steps involved, discuss online platform options and answer all questions.

Being online is critical to every retail business. We saw that last year and already see value from that this year. Business experts, accountants, mentors … everyone agree that being online is critical.

The hope I have for this session is that it offers a useful learning opportunity for newsagents, to encourage them to get online and to lay out several pathways through which they can achieve this.

And, if the 2pm timing does not work, let me know and I will do my best to schedule another session at a time that suits.

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newsagency of the future

News Corp. advises distribution newsagents of fee change

Newspaper home delivery in Australia continues to be a low-cost service with plenty of small business newspaper home delivery business owners effectively financially supporting ailing large newspaper publishers.

As I have noted here many times previously, when newspaper home delivery customers are surveyed about what they would pay for the service, the majority would be happy to pay more.

For a company that preaches free market from its platforms, it does not live it when dealing with small business newsagents.

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newspaper home delivery

Strong magazine numbers in some newsagencies in January

Check our this magazine sales data from a regional newsagency for January, reflecting excellent year on year growth in January 2021 over January 2020.

The numbers achieved by this business are typical for small town regional Australia. The growth is at the high end, reflecting an extraordinary result by the owners, who have tirelessly pursued new traffic opportunities to expand the relevance of their business.

Well done to them and to all newsagents who are achieving year on year growth numbers for magazines and their business overall.

There is plenty of good news in your channel.

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magazines

More newsagents engaging in cashless debit card trial

The federal government’s cashless debit card project is reaching more communities. Small business retail newsagents have been part of the trial since the beginning. Indeed, they were among the first retailers to participate.

Facilities embedded in selected POS software platforms enable the acceptance of the federal government’s cashless debit card as a method of payment for a defined range of goods.

Including newsagents in the trial is important in that not including them could have encouraged shopping away from the channel.

While the cashless debit card is contentious in the community, it is here that alone is reason for newsagents to engage when presented the opportunity.

I became involved in the project around two years ago, when it kicked off, through the POS software company I own. The initial trial locations in Queensland paved the way for what is now a broader roll out of the trial.

I mention this project today because more newsagents are being contacted for participation. You can see from the invitation email that it is a government initiative, not spam as some wondered.

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Newsagency management

An important 2 weeks for newsagents

This week and next are vital for card sales in newsagencies with Valentine’s Day front and centre.

Valentine’s Day is either the second or third biggest card season in plenty of retail businesses.

Achieving sales success with Val depends on interesting products being on offer, displayed well and pitched out of store in clever ways.

Our out of store promotion needs to guid people who might not purchase a Valentine’s Day card to consider doing so. I think the best way to do this is through subtle and inspiring posts.

Posts that shine a light on products people don’t see as Valentine’s related work it drawing attention to the season of those who otherwise may let it pass by.

The photo I have shared in this post is one of the Valentine’s Day gift displays in one of my stores. You can see a varied range of gifts, non traditional gifts for this season.

newsXpress has gone with the love day branding to play away from Valentine’s Day that most will use. This is because the day has evolved. I think it is important that we evolve the appeal of this and other seasons.

I encourage newsagents to make the most of the next two weeks, to play outside of what is traditional, to try and broaden the appeal of what is a key season in our businesses.

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Greeting Cards

Perth newsagents can be open during snap lockdown

The 5-day Covid lockdown announced late yesterday by the Western Australian government does not require newsagents to close based on information released by the government.

While newsagencies can remain open, advice on safe retail followed in Victoria and New South Wales recently is recommended:

  1. Have hand sanitiser at the entrance to the shop and at the counter.
  2. Have all customer facing staff in masks.
  3. Acrylic screens at the counter are a big help.
  4. If you can trade outdoors at all, do so we know outside is safer.
  5. Check your in-store communication re social distancing.
  6. Maintain good cleaning practices using anti-bacterial wipes.
  7. Remind everyone working in the shop about hand washing.
  8. If you serve in an area where English is not a dominant first language, consider using the resources at this SBS for Covid information in many different languages are excellent.
  9. Consider this social media post: With Covid challenging again, it is important that we maintain a safe and healthy distance, wash our hands regularly, use hand sanitiser and stay home if we feel unwell or have any Covid symptom. here at the shop, we offer hand sanitiser, clean regularly and enforce social distancing. Let’s squash this thing, again.

Retail businesses like newsagencies are front line businesses. The safer you make it for your shoppers and the calmer your messaging the better you will trade through this.

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Social responsibility

Your local newsagency is the best shop for Valentine’s Day cards

If you are looking for Valentine’s Day cards and / or gifts this year, shop your local newsagency first.

Why? Your local newsagency has range. They most likely have fun Valentine’s Day cards, serious cards, traditional cards and quirky cards.

Your local newsagency is an easier place to shop for Valentine’s Day cards. They give you space, they let you shop the way you want to shop. In a supermarket the aisles are full and there are people often looking at what you are looking at.

In your local newsagency, the staff can help you choose a Valentine’s Day card. They know all about good old-fashioned customer service. Tell them what you need and they can make some suggestions. At a supermarket counter this is challenging.

The thing about Valentine’s Day cards is that while it is a commercial season designed to get you to buy a card, or two, for which we thank you, it is an opportunity to add a keepsake they will cherish. Yes, there are people who hang on to every card they are given, people who keep them and look at them years later. This means that the Valentine’s Day card you give today could be a heartwarming memory tomorrow.

Newsagents are more likely to have the cards that will provide for better memories as they have range.

Fun fact: newsagents will sell more Valentine’s Day cards in 2021 than any other retail channel in Australia.

Newsagents go further, too. If you need somewhere to write on the card, your local newsagency is likely to help with this. Hey, if you need help working out what to write on the card, there will be team members in your local newsagency who can help with this too. This is what shopping local is all about, it is how local newsagents help more shoppers for cards express how they feel to those about whom they care.

For Valentine’s Day cards in 2021, shop your local newsagency and see for yourself how this local Aussie retail channel makes a difference in lives and communities. See how relevant newsagencies are today for cards and more.

While there are plenty of retail businesses selling Valentine’s Day cards, your local newsagency is the best place to shop. Go!

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Greeting Cards

Contact tracing required in WA retail, including newsagents, from Feb. 12

Click here to see the details of the requirements for contact tracing in small business retail as announced by the WA government today.

A contact register is a record of anyone over 16 years of age (including staff, customers, contractors and volunteers) who attends a specified business or venue in WA. It must record the following information:

  • Name
  • Phone number
  • Location
  • Date
  • Arrival time

Contact registration is not required for children under 16 years. However, adults that accompany children under 16 are encouraged to register their details.

The information will only be used for the purpose of COVID-19 contact tracing by the Department of Health WA, and records will be destroyed after 28 days. Their purpose is to allow health officials to quickly identify and assist anyone that may have been exposed to COVID-19.

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Newsagency management

Australia Post not proceeding with magazine trial

ALNA has shared news today that Australia Post will not be proceeding with the trial of selling magazines in its outlets.

This is great news.

ALNA has lobbied hard on this issue as have plenty of us.

I’m not sure who made the call … Australia Post, Are Media. It’s a good decision for the Aussie newsagency channel and for the magazine category more broadly. It encourages newsagents to remain or become local magazine specialists without a worry that Australia Post wants to take the shine off that.

For reference, here’s my video from October 28, 2020 on the issue:

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magazines

Learning about shopper perception from social media

Social media platforms like Twitter allow us to see what shoppers think about our channel. Looking this morning, I found the thread below on stationery. One of the comments caught my attention as they talk about the demise of local newsagents. Then, in the same thread is the comment that local newsagents were a godsend during Covid lockdown.

The more we engage on social media speaking about our channel the better. We have many good stories to tell.

Here’s the bit about the demise of our channel:

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newsagency of the future
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