Portfolio magazine was closed this week. Condé Nast closed the title two years after launch and close to US$100 million invested. Jeff Jarvis asks the big question, whether this is an indication that magazines are doomed? He goes on to say it probably means the days of launches are over. We are having a busy year here in Australia with launches. This is interesting given the 10% decline in magazine sales.
AUSTRALIAN NEWSAGENCY BLOG GETS IT WRONG
Incorrect information has been reported in a recent Australian Newsagency blog, alleging that NDD ignores retailer supply level requests for Alpha when in fact retailers were invited to review their supply in NDD’s e Newsletter on 7th April. The blog also suggests ‘lack of control’ by retailers has resulted in ‘some’ closed NDD accounts – an opinion that is unspecified, unsubstantiated and incorrect.
This is what NDD sent out to newsagents overnight. They are responding to my April 7 blog post. It is a surprising statement from the company. I approached NDD last year to have them stop supplying me with certain titles. They refused. Indeed, I have a stream of correspondence on this with the company. This is what caused me to blog as I did.
Through my work with other newsagents I have more examples of NDD refusing to stop supplying titles when requested by newsagents. Newsagents have also told me that they closed their NDD account because of this issue.
While NDD can make any claim they like, their claim that I got it wrong with what I wrote about Alpha is, itself, wrong. The way for NDD to fix this is to agree to every request from newsagents to cut supply of titles.
When speaking at newsagent conferences and workshops over the last two years I have asked what do we stand for? A common answer from newsagents was community connection, being local.
Being connected with the local community is a good unique selling proposition when most of what we sell in our newsagencies is available from other businesses, usually bigger than ours. By trading off the local connection we connect with others who are community-minded. But I wonder how locally connected we really are.
I know that in my own businesses we could do more – and I guess this is what started me thinking about this topic. I want the local connection to be real for us and for our customers.
My question for newsagents this morning is whether we are as community minded as we think? Is the connection more in our heads than our actions?
I started thinking about this over the weekend when researching how some businesses in small UK and US towns connect with their communities.
Here are some questions you could ask yourself to test your community connection:
I suspect there is a big difference between the community connection of a newsagencies in the city compared to the country. I’d be interested in what others think.
Given the resources in our businesses, there are initiatives we could take to help the local community and build our connection. Here are a few:
IGA has an excellent presentation online about their community involvement.
What is environmentally better than buying a book or magazine? Buying it online to either read on the Internet or download to read on your computer. No muss, no fuss, no scattered magazines lying around taking up space, no magazines to throw in a landfill.
From a strong pitch last week by Zinio on the environmental benefits of digital magazines.
The new Simpsons card range from Hallmark is popular. We are seeing excellent results in our stores. Since the range is right at the front of the shop, it is working as a good drawcard. Licenced product like this Simpsons range is important for newsagents since shows us as being current. The card department plays an important role in demonstrating our relevance and an even more important role in driving overall business performance. It responds well to owner attention but, unfortunately, does not receive enough of this.
VANA announced today that it is quitting its Futures Project. Regulars here will know that I have been a critic of this project from the outset. It is one of the reasons I resigned from VANA in February.
VANA has an excellent opportunity to refocus on being an association. Now, more than ever, newsagents need strong representation on policy and supplier issues.
Congratulations to the VANA Board for making this decision.
Newsagents have been granted collective bargaining rights by the ACCC. The QNF, NANA and VANA, state associations representing newsagents in Queensland, New South Wales and the ACT and Victoria have been granted the right to represent newsagents in this. This is an initiative started by the QNF and NANA. Congratulations to them for pursuing this for newsagents.
We sell upwards of 50 copies of People’s Friend magazine each week at our Forest Hill store. This week, we have the latest issue co-located next to the Herald Sun (in the old Alpha magazine stand) in pursuit of even stronger sales. The free novel which comes with People’s Friend should also help drive sales.
In its usual location, we use People’s Friend as a beacon to support other titles. This is part of our honey pot strategy, using popular products to supportproducts which are likely to appeal to the same customer.
We are promoting the latest issue of Gourmet Traveller at the counter this week. The free Italian cookbook which comes with the magazine earns it a place in this high traffic location. As we are finding more often the case now, we received little in the way of marketing collateral to support the title – so we made our own.
“Now the consumers have taken charge — they decide what news is,” Osborne said. “Monopoly power vanished. The existence of a competitive marketplace is permanent. And we should have known and we should have anticipated that.”
This is former Dallas Morning News publisher Burl Osborne speaking at a newspaper editors convention on the weekend. This speaks to our channel as much as it speaks to newspaper publishers.
Osboorne’s speech reminds us that we need to compete, on all levels – with other newsagents and indeed anyone offering products and services which compete with our business.
Our channel was established with monoply as a core point of difference in the 1800s. That ended years ago.
Not enough newsagents have embraced the opportunity of competition.
Amazon has reported a 24% jump in profit for the quarter ending March 31 compared to the same quarter last year. This is on the back of an 18% increase in revenue to US$4.89 billion. These results are significant when compared to the performance of retail businesses in the same period. Publishers Weekly analyses the results in some detail:
Gains would have been higher if the impact of currency translations is excluded. Unfortunately for publishers, however, the gains were driven by the retailer’s electronics and other general merchandise segment in both North America and abroad, which had gains of 42% and 34%, respectively.
Amazon started in business selling content and is now achieving significant growth selling infrastructure for accessing content. Hmm…
The Financial Times reports on changes in the UK around the distribution of newspapers and magazines.
We ought to expect structural changes globally in the distribution of newspapers and magazines as publishers look for ways to improve efficiency and increase or at least protect sales.
While not on the scale of the UK changes, the changes about to flow here in Australia around the new XchangeIT platform will separate newsagents into those moving forward with magazine distributors in pursuit of efficiencies from the shop floor right back to magazine publishers and those standing still with more manual and less flexible processes.
Further to my blog post Friday about gum sales falling in newsagencies, the latest issue of Convenience World magazine reports that confectionery sales were up 2.6% in c-stores in the March quarter. While this does not break gum out, even for the overall category, c-stores are reporting better numbers than newsagents.
While I am no expert in this area, I suspect we need to change the way we merchandise gum – smaller, more modern, display units at each register rather than a single, older style, unit on the counter as many newsagents have today.
The same issue of Convenience World reports that magazine sales in c-stores fell by 11% in the March quarter and that on a moving annual total basis (to February 15) they are down 9.1% for the year to March 31, 2009. They also report a 5.6% decline in newspaper sales for the quarter and 7.9% MAT to February 15. These are interesting numbers to compare to the benchmark study results released earlier this month.
Michael from Crestwood News is honouring his Great Grandfather and acknowledging Anzac Day with this photo on display at the counter this morning. While publishers require newsagents to be open today, some customers see this as being disrespectful. By placing the photo at the counter, Michael is identifying with the day and providing an opportunity for sharing his family story.
Some newsagents sell the free items removed from unsold magazines before they return them. A colleague recently saw a stack of magazine branded notepads for sale in a newsagency. Another saw a selection of tote bags. I have seen dump bins at the front of the shop with a selection of these gifts for $1 each. I even saw sets of cards from FHM magazine on the shelf next to other cards for sale.
I have been told by a newsagent that selling the magazine freebies is a way of rebalancing the magazine distributor “rip off”. I have also been told that it is better to make a buck from the junk than to throw it away. One newsagent was shocked that I would even ask why they sold the freebies.
Personally, I think selling the freebies disrespects a newsagency, its suppliers and the entire newsagency channel. It makes the shop look cheap. It trains the employees that it is okay to break rules and cheat suppliers – this could encourage them to cheat you. It shows the owner sweating the small stuff.
We do not sell the freebies from unsold magazines in my newsagencies. We return the gift with full returns. For topped returns , we toss most of the freebies. Pens, pads and anything genuinely useful is given away to staff or used in the business – they are kept in an open box for all to access.
I would be interested in what others have to say on this topic.
We are getting to the end of our diary sale and have now moved from a percentage off offer to a fixed price offer. Each diary has the orginal price and a discount price. We figured this is easier especially since we have moved beyond a half price offer. We will keep a small range for the remainder of the year but hope to quit what is left in the next two weeks. Since we moved to this new pricing approach wehave been selling 25 to 50 diaries a day.
We went into diaries in September last year with our discount strategy mapped out. Diaries are part of our overall value for money offer – that is the theory at least.
We are finding some shopping centre landlords to be more flexible than usual in providing promotional opportunities in this marketplace. Access to poster units and other places for displaying marketing collateral is free. While some landlords continue to charge for everything possible, smarter landlords are working with retailers for mutual benefit.
We are talking with the marketing departments and hunting down out-of-store marketing opportunities in our shopping centres. The photo is a poster we have put together to promote our Mother’s Day special for Sophie Randall. This is the type of collateral we will create in-house for these marketing opportunities – promoting offers exclusive to us. We don’t see any value on a generic promotion which does not play to our unique offer.
We will have a similar campaign running for at least one of our newsagencies.
This type of external marketing is essential, especially if we can access the space for free. While there is a cost in creating the collateral, a compelling offer should generate the return to justify the investment.
If we do nothing then we rely passing trade and in today’s circumstances that is not enough.
Digging deeper into the newsagency sales benchmark study I recently completed, I have found that sales of chewing gum fell by more than 15% in the sample group of newsagencies. 80% of newsagencies participating in the benchmark study reported declines.
While I am not a chewer of gum, I am surprised by this result.
Here is another variation on the stimulus package poster using the Australian flag as a backdrop for those who liked the look of our original artwork.
Feel free to use this in any way appropriate to helping your business.
We use the cavity below the Tattersalls screen to feature product – more recently a carefully selected magazine. This is important because it can add to the basket and increase the overall percentage margin from a sale. While the placement may cause concern for Tattersalls, I can show them where we are promoting their product elsewhere in the business to balance out. Food titles seem to work very well in this location – hence our pitch for Delicious this week.
We are promoting Diabetic Living at the counter over the weekend. While we prefer to promote products with a valuable giveaway in this location, a lack of such product this morning sent us looking for something we felt would work as an impulse. We selected Diabetic Living because it has responded well to other co-location promotions we have run.
I received calls yesterday from people seeking permission to use the stimulus poster I blogged about. Two asked if they could give copies to other businesses for them to use, another was from a newspaper wanting to run it as a full page ad to support local businesses and another was asking for permission to reproduce it in their newsletter. The answer to each request was Yes!
We are happy for the stimulus package poster to be used anywhere it is likely to encourage support for independently owned retail businesses.
The idea I like the most is from the newsagents printing copies for other retailers in their street to put in their windows. This is an excellent example of what being part of a local community is about.
Thank you to everyone who encouraged us to develop an alternative poster.
In reviewing online content as part of research on the newsagency of the future, I discovered an excellent review of a WH Smith store by Steve Haywood.
I used to love going to WH Smiths as a child – I lived in a small town that wasn’t big enough to have a Smiths, so it was always a real treat. I could browse through the magazines look at all the books, see exciting new board games and much more. Now though, I realise that although it sells many things, with the exception of magazines you can find somewhere better with bigger stock selling those products elsewhere on the high street.
The Lancaster store is no exception. The front third of the ground floor is dedicted to magazines and newspapers, and there’s no better range in Lancaster. The middle third sells stationary and cards – the cards are often good quality and there is an adequate range of stationary. The last third of the shop sells music, dvd and games but the choice is very poor particularly for games. Most things are a lot cheaper elsewhere too, unless you find a cheap box set, which they often have offers on.
Upstairs they sell books and a small selection of board games. I rarely go up there these days as there is much bigger choice of books and Waterstones, which is just behind WH Smiths. I’m a board game fan and am always disappointed with the games they have on sale. Bigger stores have a slightly better selection, but Lancaster is too small to sell much other than the usual monopoly, trivial pursuit, scrabble etc.
So overall good for magazines and newspapers, but not a lot else. Oh and the Lancaster store (crazily for a newsagent) is closed on Sundays, except occasionally in the run upto Christmas.
This review is a reminded that as retailers we must stand for something for if we don’t we are not memorable and not talked about in positive terms.
We need to take control of our newsagencies and turn them into memorable retail businesses which are unique and profitable. Some newsagents play in this space today. Many do not. It is hard work. The reward is a future.
WH Smith released their latest results yesterday. Magazines down 8%.
newsXpress is hosting an introductory briefing in Perth for prospective newsXpress members on April 30 – between 10am and 12 noon with a light lunch to follow. Any newsagent interested in achieving more from their business is welcome to attend. Practical marketing ideas will be outlined along with details of benefits of joining newsXpress.
I will be there along with others representing newsXpress. Click here to download a copy of the brochure.
The Take 5 tips book sent with our magazines a week back is lost in traditional newsagency magazine fixturing. Since we do not have a regular book department there is nowhere else to put this one-off publication. We ought to be asked about specialist publications like this because sending them to many newsagents is a waste of money – I took it off the shelf after I took the photo.