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

Author: Mark Fletcher

Attracting Dick Smith shoppers

fhn_dicks_gifts.JPGWe have a new range of gifts on display in our window.  The display has been created to be seen by people as they leave the new Dick Smith store opposite our newsagency.  The display does not have much height as we do not want to block the view behind the display, into our card department – another decision reflecting being opposite Dick Smith.  Our thoughts are that we need to be smart in trying to attract Dick Smith shoppers into our business.

We purchased these items in the display especially for expanding our gift offer and doing so at premium margin – we bought them at a considerable discount.

In selecting gifts, we are focusing on popular card categories for our core buying inspiration.  We know from our gift shops that gifts require consistent attention, more so than almost any other department in a newsagency.  Hence our small steps in moving into gifts in this business.

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Gifts

O’BON journals drive sales

obon2.JPGThe O’BON journals, pencils and folders we have are selling well.  Our customers like the environmental story. The journals are made using sugar cane pulp and the pencils are made from recycled newspapers – yes, an excellent like to one our core products there! The good environmental story with O’BON is enhanced by excellent product design and finishing – our customers comment on this.  While the O’BON range is sourced and recommended by newsXpress, I am sure that other newsagents wanting to carry an environmentally friendly and visually appealing range of journals, pencils and folders could arrange supply.

I have written here for some time that newsagents need a stronger presence of products which are more ‘green’ the O’BON range meets this requirement and goes beyond because of product design and quality.

For the record, no one has asked me to blog about this.  I have had the product in store for more than a month and was reviewing sales numbers yesterday.

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Environment

Promoting Cross Stitcher magazine

fhn_crosstich_june09.JPGWe are promoting Cross Stitcher magazine at the counter over the weekend.  While this is a higher priced title for which to chase impulse purchases at $12.95, the free thread sorter gift with this issue should be appealing to people into cross stitching.  I also wanted to see whether a special interest title like this can work at the counter.  So, we are playing.

Before anyone points out that we are promoting an imported title when we could promote an Australian title, I looked at our numbers for cross stitch titles and weighed up the factors for impulse purchases – value (gift), popularity and how the title presents in this type of display.  For our business, with what we have available this weekend, the offer Cross Stitcher magazine is the best I can see for us this weekend.

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magazines

Moving the magazine display on

fhn_madison_june09_b.JPGWe moved our Madison magazine display on today, it has done okay but we wanted to try the counter space for something else over the weekend.  Rather than move Madison completely back to its usual place, we have the title on display among the weeklies – for the weekend.  Just after moving Madison this morning, I saw one copy browsed and purchased by a shopper after picking up Who.  We try and always move a featured title to a secondary good traffic location before moving it back to its regular place.

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magazines

Ads on the cover of magazines

The New York Times has an interesting story about cover ads on magazine covers, Popular Science in particular.  This is interesting to me because of the use of ads stuck on the mastheads of some newspapers here.  I was interested to read that they have rules:

Ads on covers violate rules set by the American Society of Magazine Editors, which requires a clear separation between editorial space and advertising space.

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magazines

Apple move to grow magazine and newspaper subscriptions

The announcement this week of in-app commerce is game changing for newspaper and magazine publishers.  Where previously they, directly or through a ‘distributor’ could sell a product to be delivered through the iPhone and would need to sell another for the next issue or subscription, using in-app commerce, they will be far more easily able to sell the next issue or subscription.  This means there is less likely to be the churn of the current approach.

Newspaper publishers understand this.  Churn at the end of a home delivery subscription is a huge issue – as high as 50% with some subscriptions.  This is part of the reason the Advertiser announced their plans to take over management of customer accounts in Adelaide.

In-app commerce will help newspaper and magazine publishers reduce churn and therefore find delivery in the iPhone even more appealing than physical world distribution.  The new facilities enable offers to be more precise, personalised, to individual subscribers.  This is where it gets to be very smart.

Why does this matter to newsagents?  It is another reason for our suppliers to look at this rapidly growing channel which shrinks the supply chain.  A publisher / consumer relationship where the iPhone is the access point does not need a printing plant, a distributor, trucks, newsagents and returns handling facilities.

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magazines

The smaller format newsagency

I noticed reports that JB Hi Fi announced that it will open around 50 smaller format stores.  This is an interesting move.

Newsagents face a challenge around size, especially in shopping centres where landlords tend to want us to take 250 square metres and more.  If we take that size of space we need a broad offering attracting considerable traffic. With little of what we sell (today) unique to us, 250 square metres of retail space is a lot for a small business to maintain at the edge of competitiveness.

My view is that we are better off with smaller format newsagencies in shopping centres, between 100 and 150 square metres, and more narrow and specialised in focus.

A smaller format newsagency is more likely to have a genuinely unique selling proposition – with less space to manage, the challenge to harness this is easier.  Also, with less space from which to achieve a return, newsagents are likely work this more efficiently than in a larger format store.

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newsagency of the future

Newsagent unity opportunity missed?

It seems that newsagency industry politics is about to get messier with a new split emerging between the ANF, QNF ,NANA and VANA.  All four newsagent associations were actively talking behind closed doors.  It appeared progress was being made.  As the ANF advised newsagents Wednesday, a presentation was made on May 13.  This presentation to the ANF, lead by VANA, was based on a document prepared by VANA – The Way Forward 2009.  Click here for a copy of this document.

While convoluted and unclear, the document was presented to the ANF as a starting point by VANA, NANA and QNF.  The three state associations has reached broad agreement on key elements of the document.

Following the presentation, the ANF undertook to consider the proposal including that ANF Board to resigns and the handing back by the ANF of newsagent members to state associations.  These two points are an agreed requirement of VANA, NANA and QNF.  I have been told this by several people including someone close to the preparation of the document.

My understanding is that if the ANF agreed to these two key points, the states were set to agree and much sought political unity for newsagents would be a big step closer.

The bulletin published by the ANF Wednesday indicates, from my understanding, that agreement on moving forward has not been achieved.  It has been put to me by people involved that the ANF statement does not present all of the facts.

Newsagents want transparent and honest representation on issues that matter to them.  I don’t think they want spin.  Nor do I think they want representation mixed up with commercial activity as this clouds judgement on representation issues.

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Newsagent representation

Relaying wrap, chasing change

fhn_wrap.JPGOur team at Forest Hill relayed our wrap wall to refresh the offer.  This is on the wall bordering our card department.  While is is too early to say if it will result in a sales kick, there is anecdotal evidence suggesting it is attracting more shopper attention.

The work on the walls reflects a mission at Forest Hill to regularly refresh departments which are usually set-and-forget in newsagencies.

We know from US and UK retail study that refreshing the wrap offer in terms of location and range regularly – at least yearly -drives good growth.

Year on year, newsagents account for 35% to 40% of total card sales in Australia.  Our channell’s proportion of wrap and packaging is considerably smaller.  I think this is because we tend to treat wrap as the poor cousin.

By moving wrap and packaging around our goal is to find customers and help it achieve the potential we know is there.

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giftwrap

Visual merchandising inspiration

deceptionbay_brides.jpgClick on the image to see the detail of a new June Brides display created by Alexandra Carey at newsXpress Deception Bay. This beautiful display brightens the shop and enhances the experience. This is another excellent example of using the display to separate the newsagency from more traditional magazine displays.

shopfront_poppies109.jpgClick on this image to see how they represent the bridal theme in the shopfront facing into the shopping mall.  This is a significant departure from the traditional newsagency shopfront and seeks to make the business more appealing and reflecting a commitment to embracing gift and seasonal opportunities.

deceptionbay_babies.jpgClick on this image to see the new June babies display in the same newsagency.  Both displays are up at the same time.  Baby gifts are the most consistent performing gift category.  Creating a stunning visual display will deliver excellent sales results – as well as lift the visual appeal of the shop.

Both displays are an excellent example of making your newsagency your own.

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Newsagency opportunities

Too many copies of Sky and Telescope

fhn_sky_telescope1.JPGThe supply quantity for Australian Sky and Telescope is another example of over supply by the magazine distributor and or publisher this month.  I know I bang on aboutt the same stuff, over supply, often.  Sometimes, publishers engage, make contact and engage more in the scale out of their product.  Most who do this say they had no idea supply was so patchy.

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magazine distribution

Too many copies of Woodsmith

fhn_woodsmith.JPGThe magazine distribution model is hard to fathom sometimes.  While I am happy to receive more stock of what is selling, I am not happy to receive more of a title which does not sell in the quantities we already receive.

This is the case for Australian Woodsmith magazine – supply quantity increased this week for no apparent reason.  I suspect we are not alone.

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magazine distribution

Adelaide today, a test for newsagents

Some newsagents meet in an ANF organised meeting in Adelaide today to discuss plans by Advertiser Newspapers to take over collection of payment for all News Limited product home deliveries in South Australia – subscription as well as direct to newsagent accounts.

While the meeting appears set to attract between 60 and 80 newsagents, I am disappointed that the ANF did not open the meeting for all newsagents.  Any association claiming to national suppliers and arms of the government to represent all newsagents cannot afford to turn its back on all newsagents.

The ANF has made mistakes in their handling of the Advertiser changes so far. They acted on poor advice from people who stood to gain from the changes.  They had not done due diligence before indicating support for the plan.

The ANF can remedy the situation by listening to newsagents and representing all views.  They can turn around their mistakes on this matter by serving newsagents ahead of worrying about how they may look.   I don’t mind that they made a mistake – as long as they deal with this and fix the situation and stop trying to control what newsagents say.

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Newsagency challenges

Newsagent case on Award Modernisation

Click here to see a copy of the submission made by the QNF to the Australian Industrial Relations Commission and lodged on behalf of Queensland Newsagents.  The AIRC website lists all submissions received.  The QNF is the only newsagent association listed as making a submission.

This is the kind of work newsagents want from their associations.  Thorough, professional and transparent.

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Newsagency challenges

Attracting customers with Dolly magazine

dolly_watergardens.jpgHere is the Dolly photo to which Renee mentioned in a comment yesterday.  She created this display at our Watergardens store.  The display faces into the mall.  Eleven copies of Dolly magazine were sold in a few hours.  This is an excellent result.  The display attracted people walking past the shop.  Some purchased other items with Dolly.  Renee likes to create visually appealing displays which are not your typical magazine display.  These displays are working a treat for us!

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magazines

The fading Atomic magazine

Our sell-through for Atomic computer and technology magazine was 28%.  It is loss making for us.  I checked out the magazine website and was surprised to find little connection to the magazine, nothing driving retail traffic or sales.  Computer titles are challenged enough without publishers ignoring opportunities to drive retail traffic.  Put us on the website, promote the magazine, run promoting to drive traffic to newsagencies.  We give you space – returning the favour is the least you can do!

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magazines

What’s the deal with Dogs Life?

fhn_dogs_lige_jun09.JPGOur supply of Dogs Life magazine jumped by 50% this month.  No explanation, no additional marketing collateral, just extra stock.  We were surprised.  Our sales of Dogs Life are okay but not at a level to support a 50% jump.  This is the kind of increase which newsagents should be asked to approve before their cash is committed the magazine distributor an or publisher.

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magazines

50% tax break available until December 2009

Poor advice has been provided by some parties to newsagents about the tax break.  The ATO has confirmed that businesses turning over less than $2 million a year have until December 31, 2009 to purcahse eligible items.  For more details on this and for the tax break for businesses turning over more than $2 million please click here.

The person at the ATO I spoke with said that they have heard of “manipulations” of invoices to maximise the tax break.  One example was software being provided free which had a published price prior to the announcement of the tax break.  Such manipulation to avoid tax may be reversed if discovered by the Tax Office.

Time is not running out for many.

UPDATE (11/06/09):  The business which provided wrong advice has changed their blog following this post here.

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newsagent software

Weight Watchers magazine a hit

fhn_weight_watchers_jun09.JPGWe are promoting the latest issue of Weight Watchers magazine to the side of the counter – in a display seen by people walking our of our two main magazine aisles.  I have included some other magazines to fill out the display: Women’s Health, AWW’s Low Fat cookbook, Natural Health and Vegetarian Life and Annette Sym’s Symply Too Good 5.

Weight Watchers is doing very well for us following the switch to a monthly.  Last month’s issue achieved a sell through of 90% last month.  In addition to this feature display, we also have a pocket in with our weeklies and two pockets in our health section.

As with all of our displays – customers can easily purchase right off the stand.  This is very important.

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magazines

Free hair straightener with Dolly

fhn_dolly_jul09.JPGWe have the latest issue of Dolly magazine, which comes with a free nak hair straightener, on display at the entrance to our busiest magazine aisle.  The hair straightener is a great gift and is sure to drive excellent sales – we want those early in the on-sale cycle.

We also have Dolly located in its usual place. The display boxes make merchandising on the flat easy, thankfully.  My only complaint is – one poster!

I understand the importance of these gifts to support Dolly and those used to support Girlfriend – teen magazines are challenged and they need all the support they can get.

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magazines

Promoting weekly magazines

fhn_t5tl_100809.JPGOur promotion of Woman’s Day versus New Idea delivered an excellent result on Monday and Tuesday with both titles experiencing a similar lift.  We adjusted the display today to feature Take 5 and That’s Life while also supporting a selection of weeklies.  Take 5 and That’s Life are important traffic generators for us, I expect them to deliver good results from a front of shop promotion.

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magazines

iPhone continues to disrupt print

The new Apple iPhone which was launched in San Francisco yesterday extends the disruption of print media with a host of new features.  For a good summary in the context of print media and our newsagency businesses, check out these links: Editorsweblog,  The Atlantic (asking if the new iPhone can save journalism), Editor and Publisher and ValleyWag.  There are thousands of stories and blog posts on this already.

Disruption to the print model is the story of the year (and decade) for newsagents.   It is the greatest opportunity we have had since we were created in the 1800s by a publisher to distribute their product.

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magazines

Respecting the challenge of the magazine marketplace

The announcement last week of departures from ACP is part of a broader restructure occurring in magazine and newspaper publishing businesses. Just read about changes at Hearst Corp. and Hachette Filipacchi and News Magazines in the UK.  The restructure here in Australia reaches beyond ACP to other publishers and deep into distribution and retail as we all deal with the current economic circumstances and the continued impact of the Internet and disruptive devices like the iPhone and Amazon Kindle on magazines and, to a lesser extent currently, newspapers.While it would be easy for newsagents to take some pleasure from the public pain being experienced by ACP, the reality is that we are all affected. It serves no purpose to take any joy from retrenchments.

Newsagents have an opportunity in this marketplace to strengthen our value to magazine and newspaper publishers. Smart publishers will work more closely with smart newsagents to grow sales. Today’s challenges mean they should be doing this with more care than in the past.

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magazines
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