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

Author: Mark Fletcher

Australia Post, ugh!

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The TIME IS MONEY brochure from Australia Post is another example of this Government owned business using its protected monopoly to take sales from small business newsagents.

Nowhere on the glossy two-page brochure does Australia Post promote postal products.

This brochure is all about printers, ink, toner and office supplies. They are promoting this to the long suffering customers who have no choice but to visit the Government owned outlets.

Without the protection of the monopoly, Australia Post could not make these offers. Taxpayers are funding their ‘competitiveness’. It’s my view that Australia Post is operating outside what is permitted under the the Act of Parliament which governs its operation.

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Australia Post

Calendars continue to sell

It’s the middle of January and calendars are continuing to sell well. We bought 1,000 additional calendars ten days ago at a good discount just for this purpose – the January sales. The decision is paying off with sales of $200+ a day some days.  We are still only discounting 50%.

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Calendars

Recycling stands

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Newsagents receive all manner of display units for seasonal promotions as well as one off use to boost a title or some other product. Space limitations mean these units are trashed as soon as their intended use is over.

Sometimes we come across a display unit which is stroing enough to be used over and over. Such is the case with the unit we’re using for Good Health magazine at our Frankston store this week. Besides using this stand three times for the title for which it was supplied – Women’s Health – we have used it to promote five other titles. It’s strong and has a small footprint – enabling it to be placed anywhere without getting in the way.

If we kept it as a Women’s Health stand we’d have it out for a week and then rest it for three weeks – otherwise customers become blind to it. By recovering the stand we keep the unit productive and maintain the original printing to promote Women’s Health when the next issue comes out.

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magazines

I Luv Mags

Linda Tresham really does love magazines as she proclaims at her I Luv Mags website. The site offers thousands of titles for sale going right back to the 1940s in some cases. I love Linda’s enthusiasm for magazines – you almost feel compelled to buy something.

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magazines

Great summer reading?

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The promotional material from the ACP magazines Connections folks is disappointing this week. Great Summer Reading is, at best, soft. It promotes several unrelated titles and the summer connection is weak at best – most of the titles are not strong on summer features.

It’s as if someone decided to promote a range of titles and need to promote a connection. If it were up to me, I’d have canned the idea.

Now, before the Connections people complain about what I’ve written, take a moment to understand that I want kick-arse promotional material which is relevant to my customers and respects the valuable real-estate I have set aside. Great Summer reading does not respect my investment. Some titles may even get a sales kick by being in this space – however, the marketing types ought to have come up with something better.

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magazines

Bic forgets newsagents

The Brand Power ad for Bic pens and markers on TV last night closed with the tag line: check out the range of Bic stationery at your local supermarket now. I guess there is no point in newsagents carrying the Bic product anymore.  I’d guess that across our retail network we have in excess of $2,000,000 of Bic product – recieving not one cent of advertising support for our shingle.

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Stationery

IBM rips Treasurer

Another win for Advertising over news content at the Australian Financial Review today with a round Post-It type ad stuck on the front page of the newspaper. From what I hear from others, Fairfax leads the world in desecrating the their newspaper mastheads and pages with these stuck on ads.

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Here is a photo of page one of the AFR once I lifted the ad off. No, I did not set out to make a mess, I genuinely wanted to read the story underneath. I wonder how many customers will want their money back? I would.
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newspaper masthead desecration

Free newspaper talk in London

Ben Fenton, writing at The Financial Times, reports speculation about whether The Sun and or the Daily Mirror will go completely free.  That the prospect of such a move is being discussed makes it more than one person’s thought. 

Roy Greenslade, writing for The Guardian, makes some sense of the situation facing the two newspapers and points to the more dire situation facing the News of the World.  The year-on-year 6.31% fall in sales in December is close to the sales fall I have seen for newspapers in city based Australian newsagencies for the same period.

There is no doubt that newspapers face a tough year here.  Disruption from new technology and changes in news access habits are only part of the problem.  Publishers make life difficult for themselves by working against the best network they have – newsagents.  They disrespect retail newsagents by not offering any incentive to drive retail sales growth.  They disrespect home delivery newsagents by trimming margin and refusing opportunities to keep up with CPI. 

Australian newspaper publishers who want to grow their sales in 2008 would do well to engage with newsagents as business partners.  While this would be a dramatic change, it would focus newsagent attention on growth rather than survival.

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Media disruption

Online winning in music

Ian Rogers, Vice President Video and Media Applications at Yahoo! has published an excellent post based on a talk he gave at a music industry conference in December. If you want to see online music and video trends from the inside, read what Rogers’ post, it’s further evidence of how the old media world is changing and while it is about music, the insights <em>are</em> relevant to Australian newsagents, all we have to do is accept that change is coming our way too.

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Media disruption

Holland Focus magazine

holland_focus.JPGNewsagencies have an interesting collection of magazines appealing to people from other countries. Take Holland Focus it’s a unique title with limited appeal yet crucial to the point of difference newsagents offer. The challenge is where to locate the title – in travel, women’s interests (where we have British and French titles) or with foreign language titles?

Holland Focus is a title we gladly keep aside for regular customers. This put away service drives repeat business and differentiates newsagencies from many other magazine retailers.

The mix in any newsagency is dependent on the demographic and whether the newsagent has requested certain titles. In our case, we have a good range because it’s something we have fostered for years, along with foreign language newspapers. It’s a growth area for us and this is important because of fluctuating sales of the higher volume weeklies which all other retailers sell.

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magazines

Leveraging the monopoly

Stapled to the official Australia Post Order Form was the real reason for their junk mail in our post box – a one page sheet announcing: 1 DAY ONLY, 10% OFF STATIONERY.  This is further evidence of the Government owned business using its monopoly to take retail sales from independent retailers like newsagents.

The previous government said that Australia Post only offred retail products as incidental to portage products and services and that it would never abuse the monopoly to take retail business from others such as newsagents.

It will be interesting to see is the new Labor Government addresses this issue, whether they allow Australia Post management to continue to use government protection of their monopoly to take retail sales from family run newsagencies.  The stakes are high.  There are unions in Australia Post to consider as well as mums and dads who own newsagencies along with their tens of thousands of employees.

It all comes down to interpretation of the Act of Parliament under which Australia Post operates.  My reading is that the stationery flyer attached to the postal service form is not permitted under the act.  But I would take that view, it suits me.   A person or body less conflicted than me needs to look at this and advise the Government on how to navigate the issue.  If Australia Post is left to its current pla, there is no doubt jobs in newsagencies and other businesses will suffer.

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Australia Post

Free content at Wall Street Journal

It was only a matter of time before the new owners of the Wall Street Journal removed the price barrier to key online content.  Rupert Murdoch forecast as much months ago.  The announcement a couple of days ago is the first step of what many expect to be complete elimination of the subscription model.

It will be interesting to see how the folks at the Australian Financial Review react.  Despite their statements prior to Christmas that nothing would change, the Board will tolerate red ink for only so long.  The following passage from a report in The Australian yesterday makes a clear case for the free model – it’s about eyeballs.

“At the moment, we sell it to about 1 million people at a theoretical $US50 million ($55.8 million) a year,” Mr Murdoch said.

“But of that $US50 million, it costs probably $US15 million in costs of just getting subscribers and looking after them — so it’s (really) $US35 million. We think when it goes from 1 million subscribers to 20million people watching it around the world, that there will be more than enough advertising to make up the difference.”

I know of newsagents who will feel little connection with the store about the moves at the Wall Street Journal.

Newsagencies have been built around a paid model for accessing news and information, is changing.  Free newspapers in capital cities, free daily newspapers home delivered (in many US cities) and free high quality content online all challenge our model.  This challenge is an excellent opportunity, it is not something to ignore or fear.  I suspect many newsagents are doing both.

I would like to see newsagents engage in robust open debate in 2008 about their future in the face of the changes in how people access and consume news and information.  Such debate would guide better business decisions by newsagents and would-be newsagents.

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Media disruption

The Age trumps Hillary

Congratulations to the folks at The Age newspaper for pulling focus from the front page story about the passing of Sir Edmund Hillary with another garish and hated by customers stuck on ad – this time for their own newspaper. See for yourself how awful this looks…
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As for the offer on the ad, I don’t care for it. I’m a retail newsagent and have no interest in driving customers from my business to home delivery.

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newspaper masthead desecration

Make something great: with magazines

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We are using the theme of Make Something Great for our new magazine feature near one of our register points. 

Each title has been chosen because it’s about making something things: quilts, cross stitch, scrapbooks, cards, dolls, bears, knitting and beads.  Since newsagents are the only retailers of many of titles covering these subjects it’s a blue ocean opportunity for us – no competition and therefore, to me, a no-brainer. 

This promotion backs onto last week’s theme of holiday activities.  As usual with this display at the counter, customers walking up to purchase one item are making an impulse purchase of another from this display.

Newsagencies have excellent traffic.  It takes little effort to leverage that to above-average basket size (average spend per customer).

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magazines

Diet diary

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The Diet Diary on the cover of Good Health magazine this month is sponsored by Baker’s Delight. If you go to a Baker’s Delight store you’ll see copies of the diary being given away to customers.

Newsagents near a Baker’s Delight would do well to strike up a co-promotion deal with them – it would have been good if ACP had put this together as part of the promotion. I’d like Baker’s Delight stores to promote the magazine in newsagencies and newsagencies promote healthy products from Bakers Delight stores – with the diary as the link.

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magazines

Blogging frustration

As you can see from the formatting, we’re still dealing with the rapid migration from Movable Type to WordPress for managing content.  We have a new design which should be live Monday.  This will make posts easier to read.  Sorry for the inconvenience.

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About us

Newsagents embrace online training

The industry’s first ever online training session, announced earlier this week by Tower Systems, is full.  The free training session on Magazine Management will be held next Tuesday.   Tower expects to announce more dates for this session next week.  The goal is to help Tower Newsagents cut time spent managing magazines and improve commercial outcomes from the category.

If this innovative training is successful, newsagents will have access to a suite of training from the comfort of their home of newsagency office – saving time and travel costs.

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magazines

Borders A&R date set

The ACCC has set January 20 2008 as the proposed date on which it will announce its decision regarding the purchase of Borders by A&R Whitcoulls Group.  If the acquisition proceeds it created a mega retail group not only covering books but also magazines since Supanews is part of the group.  The material at the ACCC website on the proposed acquisition makes for fascinating reading.

While I am comforted at the work of the folks at the ACCC on the implications for books, I am disappointed that they have not considered the implications for magazines.  Borders has achieved good magazine sales by offering a broad range of titles, many of which are imports.  If the learnings from this are applied across A&R stores, newsagents would be impacted and this would reduce competition and therefore disadvantage the consumer.

If the acquisition proceeds I’d expect to see an impact on some newsagents.  The best action we can take today to counter this is to get smart with magazines, obsess about them, focus on the titles you sell which no-one around you has – this is where I am seeing growth in my newsagencies and several others for which I have access to data.

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Newsagency challenges

Music card theatre

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It is fascinating watching customers interact with our new range of music cards based on names.  Yesterday, twice I saw people choose a card and take it across the shop to pay it for someone browsing magazines.  Beyond getting people interacting with product, it adds a bit of theatre to the location in the store where the card is played, others around look up – all good stuff in retail.

We are fortunate that this range is not in too many stores in our centre.  If that changes I would not expect the same level of excitement (and sales) from customers.

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Greeting Cards

Saliva and browsing

I watched a customer browser Woman’s Day, New Idea and the Herald Sun earlier this week. Browsing is not the right word – she read these almost cover to cover over twenty minutes, tucked away in a corner of one of our shops. I thought she was up to no good so I watched her, the whole time. She licked her fingers prior to turning each page. When she was done, she dropped all three titles near where they are displayed, but not quite right. No manners at all.

I’m okay with browsers, even those who appear to never buy anything. What I don’t like is browsers who leave their saliva behind for paying customers to touch. Who wants that?

Some days, customer experiences are wonderful. Other days, they are frustrating.

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Customers

Woman’s Day Super Puzzler blitz

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We treated the latest issue of Woman’s Day Super Puzzler quite differently to past issues. We left more stock in the Women’s Weeklies section than in the crossword section. Sales for this issue are up 50% compared to the same period for previous issues. This is an excellent result. I’ve checked with several other stores and while some show growth, none as high as ours. I take this as even more support for placement of key branded crossword product permanently with the weeklies.

What we did with Woman’s day Super Puzzler is more important than an aisle end display or some other poster program publishers like yet it has bee more successful. If only they would reward that business success more so that a pretty display. Yep, treat me like a business person, please.

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magazines

Cleo Click magazine launch

cleo_click.JPGCleo Click from ACP Magazines is a fascinating new magazine – launched today.

Extending the reach of the successful Cleo brand, the folks at ACP have created a title which claims, on the cover: everything inside is available online.  The ninemsn website has more of the pitch to girls who want become Web Queens.

I’m surprised that there is not a more significant online presence supporting the title – given the subject matter.  But, then, they are speaking to people currently offline and guiding them online so…

I like brand extensions in the magazine space and right now ACP are the masters if you look at what they are doing around Woman’s Day, Australian Women’s Weekly, Take 5 and, now, Cleo.

One challenge I see with Cleo Click is how we represent the proposition.  This is a title which has appeal beyond people who will browse women’s titles.

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magazines

Costco and magazines

Costco, a giant in warehouse retailing in the US and rapidly growing in the UK reportedly plans five stores (according to a report in The Age) for its first year in Australia. It will be interesting to see if their Aussie stores include magazines – they are a small selection of top selling magazine titles in the UK and already sell them in the US stores.

With more majors playing in the magazine space, the trend I’d expect to see in newsagencies is a decline in weeklies and high volume monthlies and growth in special interest and other titles not carried by the majors. If I am right, more than ever it will be crucial for newsagents to achieve equitable terms on these titles.

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magazines