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

Author: Mark Fletcher

Free Trading Post

A representative from the Trading Post visited one of our newsagencies earlier this week, counted our stock and asked us to give away the remaining copies for free. They even stamped the stock with the stamp you can see on the photo below. The did the same for Things That Go.

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I am not sure of what to make of this. While a free Trading Post is nice, what does this mean for the long term? Will our customers expect it again? Is this part of a bigger plan?

I’d have preferred to have been given advance notice and an opportunity for a discussion about strategy so we could make the most of the offer at our main counter – rather than leaving the stamped stock in the usual display unit.

If these publications are going entirely free, as I expect, then they ought to talk with newsagents about being part of the free model. I’m okay with that and would welcome people coming in to collect a free Trading Post as long as I have a say on how it is pitched and where it is located.

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Media disruption

Stack em high, promoting partworks

As the photo shows, we have taken space on our dance floor to promote the Elvis, Star Trek, Treasurers of the Earth and BBC drama partworks which are all receiving strong attention at the moment.

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While there is nothing exceptionally pretty about these displays they work because they show our strength. As retailers often say, stack em high, watch em fly.

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magazines

A new competitor?

Is there a new player about to enter the newsagency traditional space of magazines and, maybe, lotteries? I have heard a couple of repoprts of a national retail brand keen to acquire into the newsagency space. I’d heard from a different source that they were also seeking to access top 20 magazine titles for their existing format.

While these are unconfirmed rumors at the moment, there is enough noise around them to warrant consideration even if only on a what if basis.  What is a new national retailer entered our space, selling the top 20 or so magazine titles?  What if they competed with us for lottery business?  What if they became more agressive in the greeting card business than they current seasons only approach?

We can sit on the side and watch these changes or we can embrace it in our businesses.  We are in the era of entrepreneurial newsagents .   These challenges separate business builders from process workers.  So, while the rumors concern me, they are highly motivating and will only lead to better newsagencies – if we want that.

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Newsagency challenges

Playboy forecasts a fall

Playboy has announced a fall in earnings and forecast a 30% fall in ad revenue from the magazine.  The Playboy consumer has easier and lower cost access to the articles and photos from a vast range of websites online.

Early indications from the latest Tower Systems newsagent benchmark project shows sales of adult magazines to have fallen by, on average, 12% in the eight months to January 31, 2008 in newsagencies compared to the eight months to Jan 31, 2007. No wonder ad revenue forecasts are gloomy.

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magazines

Free laptop for newsagents

Tower Systems is offering a free current model highly configured Dell laptop (with built in camera) to every newsagent purchasing a package from the company to celebrate the official launch of its national online training program for newsagents. The online training, in addition to face to face in-store training, a national free group training program and a national user meeting program is an exclusive service from Tower Systems which is bringing more and more newsagent together learning and sharing ideas.

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We have set no cap on the number of laptops being given away. The more the better!

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newsagent software

Airport newsagencies get it right

watermark_feb08.JPGI’ve been in airports in Melbourne, Brisbane and Sydney over the last 24 hours. The airport newsagencies, if you could impose such abroad shingle on then, are good businesses. Every product category has its space and every product earning its way. While I’m frustrated at what appears to be a beneficial magazine model, these businesses are clearly outcome focused.

I’m stating the obvious I know, but think about it. Are our 4,600 newsagencies in Australia as outcome focused? Have we configured our businesses for a maximum return week by week or are we hoping for a payday when we sell? Too many trading under the newsagency shingle have allowed their businesses to drift – too often into quicksand.

Some newsagencies I have seen recently are like the boring speech or overwritten novel – desperately in need to editing, cutting off unnecessary stock and tasks to focus on the core of our business. This is what the airport people have done, pared back, refined the model and created a business for their market. They have also created new looks – such as the Watermark Books store in the photo – magazines, books, stationery and coffee.

In searching for the newsagency of the future we have to let go of some of the past. This means editing our businesses to make them more relevant and interesting to consumers. No one will do it for us. This is our job.

These things are on my mind as I am preparing a couple in conference presentations around the theme of the newsagency of the future.

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retail

Mothering Sunday cards

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We’re embracing every possible greeting card season in our newsagencies, no matter how small or seemingly irrelevant to our customers.

If we want to be known as the card specialists it’s only appropriate we back this with commitment.  Take Mothering Sunday – Mother’s Day in the UK (March 2 this year) -  we have our cards up and, sure enough, they are selling.

What is especially nice is the thanks from customers who are happy that we remembered a season which is important to them.  It’s an opportunity to reinforce our point of difference.

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Greeting Cards

Making Elvis easier

Tower Systems earlier today released advice for its 1,450 newsagent users on how to handle the variable price model for the new Elvis partwork. This advice sheet, N5.1 at the Tower website, provides a data management standard to help ensure consistently accurate pricing for retail sales and putaways.

We have been able to develop this useful advice since we own two newsagencies and have a significant share in a third.

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newsagent software

Plush counter

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We are experimenting with small toy/plush products at the counter in one of our stores. We think they will be a good impulse item!

This is part of our play outside the traditional newsagency mix of confectionery at the counter. Think about it – in a major centre with, say, 200 stores, confectionery is available from at least 30 outlets whereas small plush like this is in one, maybe two outlets. While some small plush will work better than others, we are committed to experimenting to find a good mix for newsagencies.

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Gifts

Cheap cards turn me off

I was at a premium retail business yesterday and walking into the shop I passed a stand of $1.00 “quality” cards.  I thought what an odd message – I pass cheap cards as I enter a premium business.  Why not better quality cards?  Because they don’t sell said the retailer.  When did you last try?  Well, I haven’t.   Why make the decision for the customers?  It’s frustrating sometimes seeing confusing messages like this.

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Greeting Cards

Footy is back

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Footy is back is the theme for the category based magazine display we have at the counter.

By footy we mean AFL, of course!  Here in Victoria there is no other football than AFL, for the masses at least.

The display makes sense with all the footy titles now out from the season preview to the yearbook and a couple of club specific publications.

Footy is important to us beyond these magazines – the Herald Sun usually runs an excellent promotion around cards and we also sell close to 1,000 packs of AFL endorsed footy cards.  So, the display reinforces our commitment to the code as the pre-season gets under way.

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Customer Service

DIY magazine

Shelfmade is a yet to launch website which claims it will allow users to publish their favourite online content as a personalised print magazine.  It’s an interesting approach to connecting new media content in an old media form.  The site has no details on print runs and distribution – key if the magazine is to be for more than one person.

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magazines

Elvis is in the building

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Elvis has arrived.  We’re thrilled to have the new Official Collectors Edition of Elvis artefacts and other items now in-store.  This partwork will go off like a rocket with Elvis fans.  Issue #1 is only $2.95 we we have it on display at the front of the shop.

With the TV campaign driving people exclusively to newsagencies it makes sense that we promote the Elvis partwork aggressively.  The distributor is comitted to ensuring we have stock for customers who commit beyond the first issue – so we’re busy signing people up.  Newsagent exclusivity covers for most of the frustrations of the supply model.

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magazines

Calling all Star Trek fans

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Star Trek fans will be happy to see the original series has been repackaged into a definitive magazine and DVD collection.

We are promoting the Star Trek partwork series at the front of our newsagencies.

As we do with all partworks, we offer a putaway service with issue #1 and navigate this carefully (noisily) with the distributor to ensure that we can serve our loyal customers.

We know from basket data that partworks customers are commercially efficient, valuable, for newsagents – hence our front of shop promotion of series like this Star Trek launch.

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magazines

Closed for the winner

We confirmed for a customer yesterday that they had one first division in Saturday night’s lottery draw.  They thought they had won but were thrilled with the confirmation.  The lottery kiosk they purchased the ticket from, in our centre, was closed – as they are every Sunday.  While that’s their business, it diminishes the Tattersalls brand to have outlets in seven day trading centres closed.  This is retail after all!

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Lotteries

Australia Post wants 10% more

Australia Post is seeking a 10% increase in the price of posting a basic letter. The ACCC has announced an assessment of the proposal. I would prefer to see the new Labor Government conduct a review of postal services before any decision is made on this increase request.

European countries in 1997 agreed to a regulatory framework which sought to gradually limit the exclusivity of the postal services in each country. eGov monitor has more on this.

My beef with Australia Post is that their 865 government owned retail outlets have agressively gone after newsagency customers over the last ten years. They have leveraged their government protected monopoly over maiol services to bring customers to these retail locations for a fraction o the cost to newsagents to attract customers. This is a Government business taking business from family run operations. It’s unfair and hurts family run newsagencies.

So, I’d prefer a broader inquiry before the 10% increase is considered – what is best for Australians in the area of competition policy in relation to a postal service.

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Australia Post

UK lads mags fall

Australia is no the only place reporting circulation falls for some high profile magazines. The lads mags category in the UK has experiences a fall according to Sky News. Zoo and competitor Nuts both reported falls in circulation, 12.5% and 8.4% respectively.

The falls in the UK and Australia present an opportunity for newsagents to reassert ourselves as the magazine specialists to publishers and consumers. That’s what I’d like to see happen. Our specialisation in magazines is a tremendous asset if the publishers choose to engage.

By engage, I mean support with newsagent exclusive offers, more appropriate material for in-store promotion, external promotion of the channel to boost consumer awareness and, reward for year on year growth. Treat us like entrepreneurs and I am sure that the results will make it worthwhile.

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magazines

Harvey Norman’s ofis closer

The stationery play by Harvey Norman, is not going away as some newsagents expected. An announcement a few days ago is evidence they are finalising supplier arrangements. I hear that a March opening for the first two stores is the plan with fifty by year’s end. Now is the time for newsagents to redouble attention on stationery.

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Stationery

Underbelly the book, not banned

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Underbelly the TV series may be banned in Victoria but not the book.  We’ve taken the opportunity to promote the Underbelly: The Gangland War, the book on which the TV series is based, at one of our counters.  It’s working already – as a talking point and as a sales generator.

Sure it’s opportunistic and a little outside the usual category of product we sell (we don’t sell current issue books) but we figured why not? 

The promotion shows us as being relevant, having a sense of humor and, of course, being opportunistic.

Since we offer free broadband access at our shop, we could have gone a step further and invited people to come with their laptop and download the show for free but we figured that may be playing too much at the fringe.

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Newspaper marketing

Making the counter work for magazines

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We are enjoying success with our small counter display for magazines – it is the ideal place to promote titles with a good free gift. This month’s New Woman is an excellent example – great sales yesterday (Saturday) off the counter location.

We have tried a range of titles in this space and it is those with a gift which perform best. What’s good is that the title can be for guys or girls. Last week it was the FHM offer with a free Gillette razor.

So, we’re locking this space, between our two main serving points, as the place we will promote titles with a good giveaway. This solves a magazine fixturing problem since the traditional fixturing is a challenge with the more bulky giveaways such as sun glasses, aprons and the like. It also works in with our desire to go hard as soon as the title is out

The elements of the display will remain the same – making creating a new display each week time-efficient.

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magazines

Covering the front page

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It diminishes the stature of the national business newspaper of record that they permit post it note type ads to be stuck on their front page, over editorial content. It is even worse when the ad is for an in-house publication.

This is what has happened to the Australian Financial Review this weekend. An ad for the BRW business magazine has been stuck on the front page. It pulls focus and creates litter as customers rip the ad off after they have purchased the title.

What do I care, all I do is sell the newspaper? My comments here are more as a newspaper fan, someone who respects the medium and what it stands for. These stuck on ads demean the medium and serve as a reminder of the influence the bean counters exert over editorial content. They reduce my trust in the medium.

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newspaper masthead desecration

Moving magazines easily

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I love the magazine stand in the photo. Sent out to support the latest issue of Better Homes and Gardens, it enables us to promote this title in various locations around the newsagency.

Getting titles away from their usual place is good for business. This week we have it next to weekly newspapers, behind foreign language newspapers. Next week it will be somewhere else.  Each move finds new browsers.

Given our constant moving of stock, including magazines, a unit like this makes the task easier and helps us provide a fresh retail experience.

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magazines

How many F1 titles?

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We have three F1 titles on the shelves now. One is the regular title and two special editions. This seems overkills to me. We have a certain amount of space allocated to racing titles and we have had to lose one title early to accommodate one of the special editions.

Maybe I am sensitive about this because I am far from a fan of formula 1 racing – I think it’s a waste of money and Victoria would be better off without the drain on our public purse. I don’t see any economic benefit other than corporate types getting suppliers to pay for a day of noise and booze.

On the magazines, maybe they will sell. I suspect that the F1 brand is over represented and that the special editions pull focus from the magazine itself.

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magazines

Magazine audit full of red ink

mag_audit.JPGThe latest Audit Bureau of Circulation data for magazine sales in the three months to December 2007 is not good news for top selling titles:Woman’s Day: -7.6%; New Idea: -2.0%; NW: -10.5%; OK!: +24.9%; TV Week: -12.2%; Take 5: -2.6%; That’s Life: -1.4%.

This supports the November / December benchmark data I have seen from 50 newsagents I benchmarked. The question from many back then was am I alone is experiencing this? The Audit results show the answer is no.

The sales slump in weekly titles is significant and ought to act as a call to arms by newsagents to work harder on driving sales.

There is some good news (but not much) in the Audit results: Better Homes and Gardens: +4.5%; Donna Hay: +13.5%; Men’s Health: 10.2%; Country Home Ideas: 14.1%.

One title of interest to me was Good Health & Medicine from ACP. Sales are down 4.3%. Given the rationing of this title and late promotion (see earlier post), I wonder if titles like this miss growth because of supply chain related issues and or because the publisher is tight on print run.

Part of the challenge with magazines is that they have become a commodity in recent years – more types of retailers carry them today than when newsagents were the specialists. If someone gets the magazine they want from a convenience store or petrol outlet, they are not presented with the up-sell opportunities one sees in a newsagency. Publishers, in chasing other outlets, may have done themselves a disservice by facilitating fewer people visiting newsagencies. I’d like to see effort put into rebuilding newsagencies as the go to magazine specialists – on economically viable terms.

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magazines
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