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

Author: Mark Fletcher

USB sticks as collectibles

hero_usb.JPGThe photo shows a small super-hero like figure I picked up at the trade show in Hong Kong earlier this week. At shows like this you are given many trinkets, pens, rulers and characters like this one.  But he’s different – remove his head and you see that he’s a USB stick.

The company behind this product makes personalised USB sticks as corporate giveaways.  They also make collectibles, especially around sporting teams.

So, we see USB sticks as a business tool.  They see USB sticks as fashion and fun.  This difference can be applied to many products in our newsagencies – we often treat and merchandise stationery as a chore when we cold treat and merchandise the department from a fashion and or fun perspective.  It would change the mindset of our customers just as this action hero changed how I look at USB sticks.

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Newsagency challenges

Great Mother’s Day poster

mother.JPGI saw this Mother’s Day poster in the window of a gift shop I passed in Hong Kong earlier this week. I like the simplicity, it works well against the visually noisy background of a gift shop. The blue backing on which it has been placed helps frame the poster – without it I would have missed it.

This Mother’s Day poster would work well in a newsagency – with so much colour in our shops, often even the best designed posters get lost. I like that it’s has flowers stuck on – the photo does not do these justice.

I think we get too caught up in making pretty posters for seasons and other promotional times and forget where they will be situated and what they compete with for attention.

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retail

Mum’s Bags from Darrell Lea

We have Darrell Lea’s Mum’s Bags at the front of our newsagency as part of our Mother’s Day offer. While they are visually attractive, they don’t pop as they have in years past. These Darrell Lea gift bags are an important part of the seasonal gift mix for us since the retailers around us play me-too with Cadbury products.

mday_dl.JPG

Excuse the average display on then table – our merchandising unit from Darrell Lea went missing.

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confectionary

Super Food Ideas, recycled

syper_food.JPGI am surprised to see Super-Fast 98 family favourites from the folks behind Super Food Ideas. I say surprised because the Super Food magazine sells for $3.25. The smaller favourites (recycled) recipe publication sells for $4.95. I would have thought that a cheaper version of the favourites publication could have been used to bring people to the brand. Or, better still, a brochure version could be provided to newsagents to give away to attract people to the magazine.

While the folks at News magazines know considerably more about publishing that me, from a retailers perspective I’m left with a confusing message on the shelves.

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magazines

Vacancies at Tower Systems

My software company, Tower Systems, has two vacancies for new roles we have just created in our Melbourne office.  I am posting details here in case you know someone who may be interested.

IT support.  This is a demanding non-traditional Help Desk role.  In say non-traditional because the call variety is considerable.  We are looking for someone with retail experience, preferably experience with our software as well, who wants to get into IT support.

Sales support.  This new role has been created to provide admin assistance to our busy sales team.  Excellent admin and communications skills are essential along with an interest in sales.

Please email me at mark@towersystems.com.au for position descriptions.  We will not post the vacancies at Seek until Monday.

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About us

Newspaper home delivery, a new approach

This post is an edited version of an article I wrote for the latest issue of National Newsagent.

Home delivery is in play in newsagencies across Australia. Some newsagents are selling their distribution runs while others are walking away. For those keen to exit distribution, there are others pursuing acquisition and creating distribution specialists.

While newsagents in South Australia and Western Australia have had the distribution only model for decades, it is a relatively new model in the eastern states. In this emerging model, retail-only newsagents act as the public face of the business for payment of the account and processing over the counter stop and start requests. This is where there have been challenges in managing accounting and other records.

Thanks to work with several distribution newsagents, new technology has emerged to make it easier to process home delivery accounts, stops, starts and other transactions at retail only newsagencies. In the past such processing has been slow, cumbersome and incompatible with existing systems. I know because I have experienced this myself in my own newsagency.

The newer technology delivers better outcomes. This leads to happier customers, happier newsagents and happier publishers and makes consolidation of distribution territories easier – thanks to maintaining an excellent public face for newspaper home delivery customers.

Any number of retail newsagents can act as shop fronts for a warehouse based distribution business and maintain stable access to their retail software. From their counter they can handle stops and starts, process payments, note missed deliveries, add new customers and handle queries. The distribution newsagent can control the level of access for retail newsagent staff using sophisticated security settings.

Above all else, the latest changes improve customer service and that is what matters most.

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newsagent software

Bill Express reporting

I am surprised at some of the reporting on the Bill Express situation. Take today’s Australian Financial Review – nothing other than a rehash of the ASX announcement re the suspension of shares. Given that 3,500 retail outlets have had Optus recharge turned off and others are reporting issues with Telstra recharge I would have thought journalists would be investigating and reporting.

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Bill Express

How to handle a newspaper thief

Rowan Higgon of Pakenham Newsagency passed on this brilliant advice to a newsagent who asked how they should handle the regular theft of a newspaper delivered to a subscriber’s home.

We discuss the situation with the client and they fix it by doing the following:

  1. Keep an old paper and plastic wrap.
  2. Wrap fresh dog poo or similar into the old paper and wrap with plastic.
  3. Set alarm for the delivery of the next days paper (we advise expected arrival)
  4. Swap paper over.
  5. The thief in our case is generally on the way to the train station and unwraps said paper on the train.
  6. Thief is embarrassed and now knows that we know who it is.
  7. Problem solved.

The alternative is the owner waits for the thief and gives him a hose down.

Brilliant advice!

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Newsagency challenges

Finding the sleeper product

card_org.JPGIn every sale or catalogue there is the sleeper product which comes out of nowhere and performs exceptionally well.

The card organisers in the photo are the sleeper products from our recent book sale. For a couple of weeks they sat on display and did not sell. Then, in no time at all, they took off. Not wanting people to miss out, we put them in an even better position and created a small sign and sure enough they sold out.

When you think about it, selling card organisers in a newsagency makes sense. We never tried it until they arrived with the book sale stock – stock we did not select by item. So, having stumbled across the opportunity we’re looking to find more card organisers.

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Gifts

Convenience in Sydney

I was in Sydney yesterday and surprised at the proliferation on convenience stores in the city. They are true to their name – convenient, almost too so.  There seems to be no end to new openings – quite different to other capitals. Given the growth in magazine sales in the convenience channel studying these stores cold be good for newsagents.

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Newsagency challenges

The value of a lottery jackpot

oz_jack.JPGThe graph to the left shows our OzLotto sales week by week from when the jackpot which went off earlier this week commenced up to the latest week(at the top).  It is fascinating to see the growth over the ten weeks.  $20 million is the sweet spot.  I suspect had the prize not gone off this week and the first division reached around $60 million we would have seen another extraordinary sales jump.

Outside of the results shown on the graph is the flow-on benefit elsewhere in the newsagency.  Some department fare better than others – it comes down to what we make of the opportunity.

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Lotteries

Travel magazines and maps go together

travel_mags.JPGFor years we have had our travel magazines at one end of the shop and our maps just about at the other end. It was our new manager at Forest Hill, Jason, who spotted the mistake and brought them together. It was one of those moments when Homer Simpson’s D’oh! is all one can say. We should have done this years ago. It goes to show that for all the blogging in this place we make mistakes – sometimes very obvious mistakes. The impact of the move has been immediate for travel magazines – they are being browsed whereas in the past they were ignored.

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magazines

Kudos to Australia Post

wd_ap.JPGThe Australia Post ad on the back page of the current issue of Woman’s Day is brilliant.

This is the kind of ad I want to see from my government owned national postal service. It’s promoting the mail service – not stationery or picnic sets or sports memorabilia or calendars or magazines.

This ad gets Australia Post back to its postal service roots. Well done whoever created this campaign!

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Australia Post

Free newspaper beats print

The Standard, a free English daily in Hong Kong yesterday demonstrated its strength over the closest English paid-for daily newspaper, the South China Morning Post, with this full page ad on page 21:

standard_reins.JPG

They are amazing numbers. 224,128 audited circulation compared to 103,513. This is why we need to be concerned about free daily newspapers – the right distribution model backing a good product in the right location (population and easy mass transit access) makes the free daily a force to be reckoned with.

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Newsagency challenges

The Mars / Wrigley marriage

Wow, if the merger proceeds they are likely to become what the Motley Fool calls a confection powerhouse. Newsagents are challenged when dealing with these mega FMCG suppliers: Mars, Wrigley, Cadbury. We want to have their products because they are what consumers know yet we cannot negotiate terms which enable us to be truly competitive.  It’s a catch-22.

The alternative is to go with second and third tier brands. That does not work unless they have a local connection and or are of superior quality.

At the small business end of town we have to provide a point of difference beyond service to enable our businesses to grow as much as they are able. The difference has to be reflected in our products and since we cannot do it on price, for most items, we will have to do it on range.

This Mars / Wrigley merger, if it proceeds, will encourage some thinking newsagents and other small business operators to look around for a product based point of difference in the confectionery area. We are playing in this space in two stores with some success but it’s too early to share details at the moment.

I’m not advocating blocking the merger – they can do what they like. I’m just musing about implications.

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confectionary

US newspapers at 62 year low

Alan Mutter’s analysis of the continuing slump in circulation of US newspapers is sobering.

Based on the record 3.5% drop in daily circulation reported today for the nation’s largest newspapers, it appears that average daily circ this year will be no better than 50 million. If so, that would be the lowest level since 1946, when daily sales averaged 50.9 million, according to statistics provided by the Newspaper Association of America.

I know that from newsagent sales data, over the counter sales are down year on year to January 2008.  City and suburban newsagents and down 3.8% while rural and down 3.1% – using unit sales (and not revenue) as the measure.  This data is from a benchmark study of 89 newsagents.

The pressures US newspapers are under will hit here.  This is another reason Australian newsagents need to be looking at their model.

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Media disruption

Announcement to newsagents

What follows is the text of an fax sent to all newsagents this morning:

With more than 300 electronic voucher / recharge products available today, eziPass a great offer for newsagents.  Commission on many products is higher.  There is no long contract to sign and no extra equipment to install.  All you need is broadband in your shop and a current model thermal receipt printer.

SIGN UP NOW! Go to www.ezipass.com.au and click on retailer sign up button.  Complete your details and follow the advice on the form.  This is the fastest way to get eziPass running in your newsagency.

HOW YOU USE EZIPASS. For the 1,500 Tower Newsagents, eziPass is available from within the point of sale software. For non Tower newsagents you will be given free stand alone software to run on as many machines as you want.  The commissions and other financial arrangements are the same for Tower and non Tower newsagents.

EXCLUSIVE ST. GEORGE BANKING DEAL AVAILABLE NOW.  We have negotiated very competitive terms with St. George Bank / Bank SA for newsagents.  These terms are available for the integrated point of sale solutions as well as the stand alone terminal.  To establish St. George as your Eftpos banking provider please call them on 1300 137 524.  Tell them you are a Tower newsagent  – this will ensure you get the negotiated rates.Â

OPTUS AND VODAFONE. We are being inundated with calls from newsagents asking when we will have Optus and Vodafone recharge on eziPass.  Today, we cannot answer that question.  We are working on getting Optus and Vodafone to eziPass on several fronts.  The larger the eziPass network the stronger our negotiating position.  The best help you can provide is to sign up today for eziPass.Â

TELSTRA. Telstra recharge products are available now through eziPass.  The newsagent commission is 8%.

FREE WEBINAR – FIND OUT MORE ABOUT EZIPASS. Book now for one of our free webinars – Friday May 2 at 11am and 2pm.  Each webinar will run for about  45 minutes.  You will need access to a phone (for a toll free call) and broadband for your computer to see us and what we present.  Book your free place by emailing bookings@towersystems.com.au.Â

EZIPASS CONTACTS: General support: 03 9524 8000 or email support@towersystems.com.au;  Director: Mark Fletcher 0418 321 338 or mark@towersystems.com.au

SIGN UP NOW! Go to www.ezipass.com.au and click on retailer sign up button.  Complete your details and fax the form.

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Bill Payment

The morning rush in Hong Kong

standard_street.JPGIt is fascinating watching the commuter rush here in Hong Kong. You soon see how The Standard has become so successful with its free newspaper – excellent locations at all high traffic transit positions. Their people are easy to spot and they are good at what they do. It’s all about fast and efficient distribution.

Watching the process this morning it’s clear to me that in large cities with enough commuter traffic the free morning newspaper model is better than a paid model. Being free you can cut some costs out of the supply chain – at the publisher end as well as at the retailer / distributor end.

The geographic spread in Australia and our small size makes the free morning newspaper more challenging for publishers. While they can get city workers, it’s in the suburbs and country where they would be challenged. However, in the US there is one publisher doing very well with a free home delivery model. These are trends newsagents need to remain across.

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Newsagency challenges

Free Comic Book Day

More than 40 US and Canadian comic book publishers have got together to support Free Comic Book Day 2008 by offering free samples at participating comic book stores. This is a brilliant idea! Comic sales are down and there is no better way to attract new interest than a national campaign based around a free offer. The day is timed to coincide with the opening of the Iron Man movie in the US. ince the start of Free Comic Book day, more than 15 million free comics have been given away.

It is great to see publishers, distributors and retailers all behind this. Brilliant!

Many times over the last six years I have suggested to Australian magazine publishers, ACP, Pacific and Lovatts that they offer free sample product through newsagents. None has been interested enough to act. Lovatts offer free samples through their website but not through the retail network. If we want to grow the magazine marketplace we need to attract people and the free offer worth trying. I have been astounded each time the publishers ignored the idea – here’s a retailer wanting to grow the marketplace and they are not prepared to take the risk.

The opther suggestion I made was that publishers like Lovatts, with their timeless crossword product, provide giveaways for newsagents to use on weeks like the last one when lottery traffic was through the roof because of the OzLotto $40 million jackpot.

We could give away samples as part of a National Magazine Week. They have one in the UK and understand it’s a ripper of a success.

I’d expect most newsagents to wholeheartedly embrace a national magazine promotion which supported by publishers. I’d expect the return to far outweigh the cost. Meanwhile, kudos to comic publishers in the US and Canada for their entrepreneurial initiative.

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magazines

Innovation, investment and newsagencies

The April 28 issue of Business Week lists the 25 Most Innovative Companies as compiled by the Boston Consulting Group. It’s a fascinating read. What stands ot from reading the article is the commercial value of investment in the business.

  • Apple has rocketed to #3 in the smartphone marketn because of innovation which came our of investment in the business.
  • Google is, well, Google, the leader in online search. Lasst year they increased R&D spending by 72%.
  • Wal-Mart is turning itself around by investing in sustainability.

Check out the full list in Business Week for yourself. Some of the companies on the list have faced life or death challenged. They invested their way out to a brighter future. This spoke to me and the challenges newsagents face – except that we are not investing our way out. Our shop fits are, for the most part, not changing. Our product mix is, for the most part, not changing. Our margins are, for the most part, where they were twenty years ago. Our operating costs are worse.

How great would it be for Australian newsagents to be judged the most innovative retailers? For that to happen we need to boldly act and invest – in our own businesses and collectively.

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Newsagency challenges

eziPass update

Even though I am in Hong Kong I have been in close contact with the Tower office about the fall out of the increasing difficulties Bill Express finds itself in.  We have been swamped with calls today about eziPass, how to sign up, whether Optus and Vodafone will come on board.  I have prepared a fax tonight which will go out tomorrow sharing as much as we are able at the moment.  This fax includes the 1300 number newsagents can call to access the amazing St.George / Bank SA rates we have negotiated for newsagents.

Newsagents wanting to get live with eziPass need to go to the website and click on retailer signup.  Complete the form and follow instructions for returning that for processing.

There is no doubt that our growing network of 450 – 500 newsagents has got suppliers interested.  I am fielding calls from businesses keen to offer their products through eziPass – some are saying they did not deal with Bill Express because of the cost of loading new products.

By signing up for eziPass you are showing to suppliers that you want a recharge / electronic platform in newsagencies.  Remember, it’s free and there is no long contract.

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Bill Payment

Hong Kong Gift Fair

gift_fair.JPGWith close to 4,000 exhibitors from 40 countries and booths covering 78,000 square metres this is the biggest gift fair in the world. From 9am the floors were packed with people looking for products. While there is junk, there are many good items worth considering.

While I am here looking for gift related items, I have found myself looking at products which may work in newsagencies which we do not carry today. Some good new opportunities to expand our retail offer and to leverage the lower manufacturing cost of China production.  The booths here are packed with items we would not see at newsagent trade shows in Australia.  And the prices!

As is always the case with Hong Kong trade shows, it’s a huge eye opener. Secretly, I like listening to the questions European and American buyers ask – fascinating!

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Gifts
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