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

Author: Mark Fletcher

Spotlight on News Corp circulation numbers

Alex Turnbull tweeted Monday about circulation numbers for News Corp. titles

Here are two tables included in the thread. Turnbull says they are from the News Corp. 10K filing. They show challenging circulation numbers for the publisher. The first table shows the year on year movement in circulation for cap city dailies. the declines we are seeing here are like what we have seen over the last two years for most Fairfax titles.

This second table shows circulation for cap city dailies.

In Some respects, there is nothing new here. Through the quarterly benchmark results we have seen declines in over the counter purchase. However, for the Herald Sun and the Daily Telegraph, my numbers re not as bad as the numbers here.

Newsagents cannot rely in print newspapers whatsoever in their business planning and modelling. We can transition through this and have viable, growing businesses. Achieving that requires action and a focus outside what has been traditional for Australian newsagency businesses.

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Media disruption

Pitching Christmas card postage price can help sales

We place this poster pitching the 65 cent Christmas card postage price tactically in the shop to remind shoppers that cards cost less to post than usual letters.

Small reminders like this help this time of year when we have the infrequent card shopper in-store.

Better still, selling the stamps and providing a place for people to write on the cards and offering to post them helps drive an even better outcome.

Christmas card sales are strong this year. It is too early to do the year on year comparison but I am feeling good. Boxed cards have been especially strong.

This same pitch also works on social media.

We all need to do our bit to nurture card buying. Merely allocating the space in-store for card companies to stock and manage is not enough any more.

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Greeting Cards

News Corp’s Coles Little Shop Mini campaign is a mess and hurts for small business newsagents

What a messy weekend for for newsagents because of the News Corp. promoted Coles Little Shop Mini campaign. The company aggressively promoted the free offer one the front of the paper, the paper sold in newsagencies.

FREE TODAY. WITH THE PAPER. The pitch on the front page of the Sunday Herald Sun is clear. However, it was not free with the paper, not in newsagencies. No, we had to tell shoppers they needed to go to Coles to buy then paper to get the free Little Shop Mini. How ridiculous. News Corp. sold newsagents out.

This is another example of the giant News Corp. siding with its mate the giant Coles Corporation, to the detriment of small business newsagents.

Customers at newsagency counters were angry yesterday and Saturday. Plenty wanted to argue about it from what I am told. This disrupted the shop and impacted negatively on the business.

Yet, newsagents we’re innocent. Telling people to the fine print inside the newspaper did not help.

Here is the detail of the offer inside the Sunday Herald Sun yesterday. The fine print is really fine and that made people angrier. Just give me my F&*$ing little shop thing you moron one customer said to the newsagency sales assistant. No one should have to put up with this anger. And, we would not have to put up with it if News Corp. did a better job executing the campaign. They did not. They failed us. They failed small business. All to benefit a big business mate in Coles.

Take a look at the fine print from yesterday’s Sunday Herald Sun…

Burying this as they did, News Corp. setup trouble for newsagents and other non Coles retailers.

What a mess.

Those responsible at News Corp. owe newsagents an apology for the harm done, the hurt caused and the disrespect shown.

Now, a note to newsagency suppliers who also supply Coles – what has happened here plays into how newsagents feel about your engagement with the supermarket giant and other giants. For here we have a long-term newsagency supplier, one we launched distribution for in this country acting in ways that hurt our businesses and our brand in our local communities. How we feel about this plays into how we feel about your involvement with Coles and similar.

One newsagent told me yesterday that this campaign will bring forward their decision to cut newspapers from their shop as they are sick of the lack of control over the impact this mediocre margin product has on their business.

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Ethics

Newsagency customers angry at Herald Sun Coles promotion

The newspaper customer says they want the Little Shop Christmas Mini. When told they have to go to Coles they become frustrated. When told they have to actually buy the paper from there to be able to get it them ask: so why is advertised on the front of the paper here?

I agree.

Why is News Copy promoting a Coles exclusive offer on the front page of newspapers sold in newsagencies.

This front page cam pain by News Corp. is disruptive, disrespectful and demonstrating support for the supermarket giant over independent small business retailers.

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Newspapers

Fast turnaround local videos drive social media engagement and sales

Four new ranges of products have been launched by US company Ty in Australia over the last month. The launches have driven in-store and online shopper interest to new levels. While the launch range was exclusive to newsXpress, the other three were not.

I decided we would produce in-house shot videos as a differentiator. This morning, we published the seventh video that we have made. There are more in the can ready for release.

The videos are made solely for social media. They educate about the product and pitch the newsXpress offer in a fresh and different light to what you see from other retailers. They pitch in a may that is not traditional for newsagency businesses.

Differentiation is key in the collectible space of what are essentially mass produced items.

Here is one of the videos we released earlier this week, which has had thousands of views.

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marketing

The $153.89 online sale that uncovered a new shopper

We got an online sale Saturday night for $153.89 to someone who lives a ten minutes from the shop. They knew they were purchasing local but did not take much notice of where we were since they don’t often come to the big shopping centre.

Now that they know what we have and are so close, they have said they will come in because previously they had only bought this specific category online.

We found them through the website and the service provided helped connect them with the physical store.

Every day or so this story repeats and online sales grow and as a web presence plays a more important role in being found by shoppers looking for products we sell. Doing this through interest categories and / or brands is valuable as it puts us in front of people who would not look in  a newsagency for what we sell.

We knew websites are used to guide in-store purchases from research by Telstra and others. Experiencing this first have for a product category that ends itself to repeat business is most encouraging.

Having a good website is key. It being easily found is also key. These things deliver online revenue but, better still, can drive in-store purchase.

Oh, and the product in this transaction is not a usual newsagency line … and, it has a >50% gross profit.

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marketing

UK regional free newspaper closes: home delivery model no longer sustainable

Reach, the UK’s largest regional newspaper publisher says the home delivery distribution model for its free newspapers is “no longer sustainable”. It is closing the Solihull News this month, a title with a circulation of 44,786, according to December 2017 audit figures.

Reach (formerly Trinity Mirror) attributed the struggle to a “continued decline in local print advertising, particularly in the key property platform”.

In Australia we have been insulted from newspaper closures with plenty of our titles delivering lower circulation numbers that US and UK titles that have closed. I suspect this is in part due to the propping up of titles by newsagents through the provision of low cost distribution.

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newspaper home delivery

A news consumer’s view of the paywall and the impact on newsagents

This is an interesting thread on Twitter about the new paywall for The Brisbane Times. Newsagents get a mention. Be sure to read the full thread and comments.

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Media disruption

Fairfax announces plans to change newsagent remuneration

At the same time as passing on a modest fee increase for distribution and retail newsagents, Fairfax has signalled a change to its remuneration process. This, in a letter sent to newsagents. I bolded the part of the letter that deals with the change.

 Fairfax Media Newsagent Fee Review – NSW & ACT (excluding Far North Coast NSW) 

Fairfax Media has now completed a detailed review of the retail sales fees and delivery service fees currently paid to newsagents for The Sydney Morning Herald, The Sun-Herald and The Age newspapers. 

Fairfax considers that the current annual fee review process needs to change to reflect the changing newspaper sales and distribution landscape. It is our intention to move to a fee model and review process that is performance based. This model will provide for fee increases based on specific performance metrics, and will align with our newsagency contracts which contain provisions for fee penalties for non-compliance, or failure to meet existing performance criteria. Work on this is already underway. 

In the interim, Fairfax has decided to pass on an increase to its sales and service fees effective from Monday 3 December 2018. 

The following fees will increase and will be reflected on your weekly newsagent statements issued after that date – 

  • Retail Sales Fee 
  • Home Delivery Service Fee 
  • Home Delivery Fee – 2nd or multiple copies 
  • Fairfax Managed Sub-Agent Delivery Fee (Supermarket/chain deliveries) 

Details of each of the fee increases are shown in the Tables on the following pages of this notice. Further information can be found in the Fairfax Fee Schedule which will be available on Connect shortly. 

I think this letter signals plans for a shake out of newspaper distribution and retail businesses, given the focus on compliance and the goal of aligning with provisions in the Fairfax contract.

What Fairfax management does not get is that what they pay is a pittance for a retail presence. Year on year, rent increases by 5%, wages by between 3% and 5% and overheads by 5%. Fairfax has not been keeping up and their forecast new approach will make matters worse I suspect. The result will be fewer retail newsagents selling their products.

Here are the new fees announced with the letter:

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Newspaper distribution

Unusually heavy newspaper set to challenge delivery newsagents

There are reports that The Daily Telegraph next Saturday will weight just under 1kg. The thin papers of recent years have seen distribution newsagents and their delivery people adjust processes, equipment and the throw.

The forecast considerable weight reminds me of the work done more than ten years ago by the then ANF into ergonomic matters relating to newspaper delivery. The Nery Report, as it was called, was the focus of distribution newsagents for many months.

According to the Nery Report, current work practices are unsafe. The report documents unsafe work practices which stem, in part, from having to handle heavy newspapers. Any newspaper above .6 kilogram in weight is considered to be heavy. Consider this quote from the Executive Summary the report:

The Results section of this report (page 10) has outlined significant ergonomic risk factors associated with the newspaper delivery tasks. These risk factors are particularly related to dimensions of the weekend papers (Advertiser and Sunday Mail) when combined with the repetition, volume and manual handling aspects of the delivery process. In particular, there are significant risks associated with the delivery/throwing of the larger dimensioned and heavier Saturday Advertiser and Sunday Mail newspapers.

David Nery, the respected author of the Nery report was clear:

The current situation, in my view, is unsafe and modifications to the weight, dimensions and volume of papers distributed per person need to be reduced to provide a safe system of work.

While I have written plenty of times here about heavy newspapers and the Nery Report, it feels odd to be writing about it in 2018 when some days papers are mere pamphlets.

If the unusually large paper does proceed this weekend, newsagents should take appropriate precautions and engage with staff to ensure reasonable occupational health and safety.

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Newsagency challenges

How changing a Facebook icon photo can lead to sales

We changed the small square Facebook icon photo last week and a few minutes later we had a sale of the item featured in the photo. The photo of the Harry Potter school bag was a hit. We used the photo because we liked it, not actually expecting to make an immediate sale. The experience was a timely rem under two regularly change this photo and to do it regularly.

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marketing

Trump cards popular

We have a few Donald Trump themes cards in-store and they are popular. The greater the fun they make of him the more popular they are. The squishy we had of Trump was popular too. Just as Trump mocks others, plenty of people enjoy mocking him … and we are happy to oblige with product.

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Greeting Cards

The challenge for celebrity / gossip magazines

Sales of celebrity / gossip titles continue to fall dramatically. They are not the traffic drivers we relied on in our newsagency businesses ten and more years ago. Back then, Monday’s were wonderful with the steady stream of shoppers coming in for their fix. Today, while day of issue sales are higher than other days, they are not even remotely close to what they were.

The consumer of these titles is well satisfied with immediate access through TMZ, social media, purpose specific apps and channels such as YouTube and Twitter, like this one, PeopleTV…

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magazines

Government owned Australia Post outlets over reach, again, with Christmas catalogue

The latest catalogue distributed by Australia Post, a Christmas catalogue, sees, in my opinion, Australia Post overstep its obligations under the Act under which it operates. My concern here is their corporate stores, their government owned stores. These stores are the federal government operating a business, competing with small family run businesses.

Take a look at some of what is in this sixteen page catalogue.

How do I see this as an overstep? Australia Post is a protected brand, a monopoly. landlords give them preferential treatment, delivering a lower occupancy cost. They land people in their shops because of their monopoly over core products and services.

Here is why I think they are in breach of the act.

Section 14 of the Act requires Australia Post to provide a postal service first and foremost:

The principal function of Australia Post is to supply postal services within Australia and between Australia and places outside Australia.

Section 15 talks about permitted subsidiary functions:

A subsidiary function of Australia Post is to carry on, outside Australia, any business or activity relating to postal services.

Section 16 talks about other permitted functions:

Functions incidental businesses and activities

(1) The functions of Australia Post include the carrying on, within or outside Australia, of any business or activity that is incidental to: (a) the supplying of postal services under section 14; or (b) the carrying on of any business or activity under section 15.
(2) Without limiting subsection (1), the functions of Australia Post include the carrying on, within or outside Australia, of any business or activity that is capable of being conveniently carried on: (a) by the use of resources that are not immediately required in carrying out Australia Post’s principal or subsidiary function; or (b) in the course of: (i) supplying postal services under section 14; or (ii) carrying on any business or activity under section 15.

Successive federal governments  have permitted Australia Post to take millions of dollars in revenue from small businesses, from family businesses. The situation is getting worse. The behaviour of federal politicians in relation to Australia Post over-reach makes a mockery of the often repeated claims in support of small business.

The federal government deregulated newspaper and magazine distribution in 1999 saying that newsagents needed to get into the competitive world.  It is a pity that they have not applied the same competition rules to the business they own.

Back to the Christmas 2018 catalogue. Almost every page contains items shoppers can purchase from their local newsagency, pharmacy, toy shop, book shop and more … local family run businesses that need to market to attract shoppers for what they sell. Australia Post, on the other hand, lands people for low cost because of their monopoly and then sell what these other small businesses sell, as the add on, as the cream … dining revue from the independent small businesses.

It is time for Aussie politicians to walk the walk when it comes to small business retail.

Finally, to be clear, I have no concern with what LPOs do in that they are locally owned businesses. My concern here is the corporate stores.

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Australia Post

Small Business Ombudsman payment times survey

The Small Business Ombudsman has launched a survey seeking data on payment times being experienecedc by small businesses. This survey will help develop understanding of the current payment times being experienced by small businesses.

Partial and late payments, seeking discounts to pay in 30 days, offering loans to cover extended terms, forces the business to find ways to finance the short fall in their working capital.

ASBFEO’s 2017 Payment Times and Practices Inquiry found Australian corporations paid invoices on average 26.4 days late – the worst in the world. Our more recent research, involving 1600 businesses, identified the biggest cause of dispute remains payments (44%); either the full amount not being paid (26%) or not being paid on time (18%). The ASBFEO is seeking feedback from small and family businesses on this issue.

If you run accounts in your business, this quick survey is a good way of ensuring your experiences in getting paid are represented at an important level of government.

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Newsagency management

Newsagents set to see less public transport ticket related traffic

The announcement this week by the NSW state government that people will be able to use their credit / debit card to travel on trains is another indicator that newsagents should not rely on agency business.

Sydney commuters and tourists can now pay for their train rides by tapping on with a credit or debit card, instead of an Opal.

The NSW Government announced the system has been rolled out across the city’s entire train network, after trials on ferries and light rail.

The changes bring Sydney in line with other contactless payment methods in other international cities, such as London.

NSW Transport Minister Andrew Constance said the new system would not replace Opal cards.

Government and privately owned businesses that rely on newsagents and other retailers to act as agents for collecting money are focussed on cutting costs. A retail network is expensive, despite agency fees being fractional. This move in NSW makes sense.

From a traveller perspective, not having to go to a shop to load money on a card to use on a train is a good thing. However, it increases the risk of minor card fraud.

From the transport operator perspective, it more directly connects them with their customer.

Sure, there are restrictions on card use, such as the handling of concession pricing. However, over time they will resolve this. People want fewer cards. Companies like Apple want people to replace all their cards with their phone.

Thinking more broadly on the topic of agency related business, my advice has been and continues to be that I see no upside whatsoever in agency lines for small business retailers. They are inefficient in terms of basket depth and often come with compliance requirements that can play against what is best for the long term health of the business.

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Newsagency management

RBA engage in discussion on going cashless

Further to my posts here, here and elsewhere on the cashless trend, the ABN yesterday reported on comments by the Governor of the Reserve Bank on this topic.

Regulators are pushing us into a cashless world as RBA declares ‘a turning point has been reached’
By business reporter Nassim Khadem

Cash will become a niche payment sooner than we think and cheques will be phased out, says Reserve Bank of Australia governor Philip Lowe, as the Federal Government considers imposing tougher penalties on cash economy activity.

On Monday Mr Lowe told the Australian Payments Summit in Sydney that for some decades people have been speculating that we might one day go cashless, and now it could become a reality.

“It looks like a turning point has been reached. It is now easier than it has been to conceive of a world in which banknotes are used for relatively few payments; that cash becomes a niche payment instrument,” Mr Lowe said.

Non cash payment in retail is certainly growing as all of us with shops are seeing. This is being facilitated by multiple payment options as well as new sources of finance for sending such as the buy now pay later providers.

It is important we engage with a variety of options so how we receive payment is not a barrier to getting the sale.

Whether we like it or not, cashless business is growing. Governments, especially, will like this as it better serves their revenue need.

The ABC article references a Treasury discussion paper on the digital economy. Click here to access that discussion paper.

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Newsagency management

Beware EFTPOS scams in retail

TV news in various cities have been reporting on an increase in EFTPOS scams in recent months. My advice: never let your terminal out of your control. This is what scammers most commonly do, ask for access to the terminal for what sounds like a legitimate reason and then they pull their stunt.

Here is one video of a news report from Western Australia…

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Newsagency management

Tatts ignores retailers in Set For Life social media marketing

This ad for Tatts appeared in the Facebook feed on my phone over the weekend. Take a look, nowhere does it pitch in-store purchase. This ad is 100% about direct purchase by the customer through the Tatts App.

Since I have the Tatts App on my phone, the ad has a button “Use App” that I can click to easily and immediately make the purchase.

This type of marketing is what I would do if I was Tatts. It is efficient and enhances the direct shopper relationship. This has to be a core focus for their business.

Purchases through the App drive shopper stickiness in ways the in-store purchase cannot. This is just one of many reasons the direct shopper is more interesting and valuable to Tatts.

Retailers cannot compete in the evolution of lottery purchases in my view. I hope I am wrong, I hope I am missing things in my assessment of what I see coming.

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Lotteries

Marketing tip: Christmas marketing ideas

Every year I publish Christmas marketing ideas. This year, I have put together a small list of my favourite ideas.

  1. Pitch easy shopping. People often talk about how hard Christmas is. Be the local business that makes it easy. Tell people how you make it easy.
  2. Make the shop less about Christmas. Consider pulling back on the Christmas visual noise. Go for something simple, muted, respecting the season but making a calm statement. Consider declaring the shop a Christmas carol free zone – not because you hate carols but because you want to help customers take a break.
  3. Help people rest and recharge. Create a Christmas shopping rest and recovery zone. Offer free tea, coffee, water and something to eat. Encourage people to take a break in your shop – without any obligation for them to spend money with you.
  4. Let your customers help each other. Setup a whiteboard or sheets of butcher’s paper, yes keep it simple. Get customers to write gift suggestions under different age/gender groups. For example: Girls 18 – 25, Boys 55+. Encourage your customers to help each other through their suggestions.
  5. Make price comparison difficult. If you sell items people are likely to price compare with other businesses, package them so price comparison is not easy. Put items into a hamper as a perfect Boy 8 to 12 bundle for example. Or offer the item with pre packages services if appropriate for an item.
  6. Be community minded. Choose a local charity or community group to support through Christmas. Consider: a change collection tin at the counter; a themed Christmas window display; promotion on your social media pages; a donation to their work; a collection point for donations from customers.
  7. Facilitate sharing stories. Find space in your shop for customers to share their Christmas stories. It could be a story wall inside or in front of the shop. This initiative encourages storytelling by locals and better connects the business with the community.
  8. Leverage Christmas traffic. Encourage the Christmas shopper traffic surge in after Christmas. Give them a reason to come back. A coupon promotion or a discount voucher on receipts could be the enticement to get shoppers back in-store. Note: the Tower POS software produces discount vouchers to rules you establish.
  9. Become a gallery. Work with a school, kindergarten, community group or retirement village to bring in local art for people to come and see through Christmas. A small space commitment can drive traffic from family and friends of those with art on show.
  10. Make your shop smell like Christmas.
  11. Send cards. Send Christmas cards early in the season to suppliers, key customers and local community groups. This connects you with Christmas. Invite all team members to sign each card.
  12. Host a Christmas party. For shops nearby. You are all in the season together – let your hear down before things get crazy.
  13. Keep it fresh. Every week make significant change to your Christmas displays and promotions to keep your offer fresh.
  14. Share Christmas recipes. Each week for, say, four weeks, give customers a family Christmas recipe. This personalises Christmas in your business, creates a talking point and makes shopping with you different to your bigger competitors.
  15. Free wrapping. Sure, many retailers offer this. Make your offer better, more creative and more appreciated.
  16. Hold back. Don’t go out with everything you have for Christmas all at once. Plan the season to show off what you have as the season unfolds. This allows you multiple launches.
  17. Share a taste. Regardless if your type of business, bake a family recipe of Christmas cake, Christmas pudding or Christmas biscuits and offer tastings to shoppers on select days. This personalises the experience in your shop.
  18. Offer hampers. Package several items together and offer them as a hamper. Time-poor shoppers could appreciate you doing this work for them. We have seen this work in many different retail situations.
  19. Buy X get Y. Encourage people to spend more with a volume based deal. Pitched right, this could get customers purchasing items for several family members in order to get the price offer you have. Use your technology to manage this.

Christmas is the perfect time to plan for next year. It is the time to do everything possible to leverage bonus Christmas traffic to benefit your business through next year.

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marketing

Fairfax pitching in-store digital screen

Fairfax is pitching this digital screen to newsagents in Victoria.

Here is the pitch they make:

We have a 32″ LCD screen which will feature Fairfax promotional ads but also allows each store to place their own ads on the screen at no cost, excluding News Corp products and Tattersalls.

These screens can be mounted on the ceiling or on the wall, all installation expenses are covered with Fairfax. The image below is only a example.

I am keen on reducing visual noise rather than increasing it. Also, giving prime space to promote a low-margin non net new traffic generating product is of questionable value. So, not for us. However, there are others who may find the opportunity interesting … hence, this post.

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Newspapers
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