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

Terrific Baker’s Delight back to school promotion

I love the creative for the BTS promotion in Baker’s Delight stores. In addition to the on-screen promotions there was a banner at the back of the counter and a pitch at the front of the counter. All visuals were consistent. This visual consistency is important in driving shopper engagement.

Their use of colour pencils was smart as it provided an appealing base for the marketing collateral. I also love the cheerful headline for the collateral.

Well done Baker’s Delight!

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marketing

Governments need to address business price quoting just as they are addressing housing under quoting

Under quoting by real estate agents is an issue that gets plenty of medial and politician attention, especially in Victoria and New South wales where auctions appear to be more popular. In Victoria recently  one agent was fined and more are heading to court.

In our channel, the problem is the misrepresentation of the performance of the business. This is done several ways:

  1. The misstatement of the profit of the business by providing a blended P&L and not the P&L the business actually operates under.
  2. The valuation of stock as if it is all current when, too often, plenty of the stock sold with the business is not current.
  3. The value of business assets such as the computer system where they have no value because they have not been maintained or because the data is useless. Useless data = no business value.
  4. The misstatement of revenue because of manipulation to minimise tax.
  5. The misstatement of actual business costs because of poor records for owner time required in the business.

Some brokers are dreadful at preparing a business for sale and providing prospective purchasers with accurate and reliable data on which to make their decision. this can see people coming into the business unprepared and based on data that is completely wrong.

I have had two calls this week from people looking to buy newsagencies in Victoria and in each case the broker has not done their job in preparing the business. For example, they have a value for the computer system, considering it and the data an assist. In each case, the data in the computer system is useless, there is no stock on hand value, no tracking of each item sold and no compliance with industry data standards. A quick check by the lazy broker could have discovered this and counselled the newsagent to sort the data out to make the business more appealing.

People looking at buying a newsagency need to be fierce. They need to ask the tough questions, demand proof and only proceed when they are completely satisfied.

People selling their newsagency need to prepare the business, make it appealing,e sure all data is accurate and clean house so the sale is easy … otherwise, people like me, when asked for an opinion, say don’t do it, not this time.

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buying a newsagency

The Roald Dahl promotion with News Corp titles

News Corp has been sloppy in organising the Roald Dahl promotion that launches in ten-day. Rather than give the newsagency software companies a head’s up so they could provide timely advice, They told newsagents and left it for them to tell the software companies. Poor form News Corp.

I am surprised by the different communication. Click here for the NSW notice.  Click here for the VIC notice. The difference in style is considerable. Why the company feels this is necessary is beyond me.

Dahl’s appeal notwithstanding, for the margin we make I am not a fan of these promotions. It is time for a fresh approach.

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Newspapers

Success with Pokemon plush in the newsagency

This is a terrific result, $1000 of Pokémon plush in a few weeks in the newsagency. Good margin, new traffic thanks to out of store marketing, nice impulse purchases from existing shoppers and an efficient return on floor space thanks to the small formal floor unit.

This is a win for a product you’d not find in a traditional newsagency.

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Newsagency opportunities

Will the AFL women’s league help drive sales?

Today’s Inside Football  features a cover story about the imminent launch of the AFL women’s league. This gives is an opportunity to gauge interest in the women’s league. In AFL crazy Melbourne it’s good to have the opportunity to reach a wider audience with AFL product. We are pitching the magazine with newspapers to drive impulse opportunities.

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magazines

When will Fairfax stop publishing The Age, SMH and AFR daily?

News Corp. continues its obsession with Fairfax by speculating in the The Australian about Fairfax plans to stop printing weekday newspapers.

My feeling is News is actively watching this as a Fairfax announcement would make it easier for News to make its own announcement.

The question for newsagents is: are you ready? This will happen, newspapers you sell today will stop being printed, are you ready?

FYI, I am on the record from last year saying I expect the changes to start this year. I expect that The Age, The Sydney Morning Herald and The Australian Financial Review will cease daily publication. Based on circulation numbers, the cost of print distribution and the continuing evolution in how we access and consume news, the print newspaper is redundant for today’s marketplace.

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Newspapers

The Reject Shop ups the ante on cards

The Reject Shop two doors away from the newsagency has started pitching cards on the lease line including these 75 cent cards. While colleagues tell me they have seen cards at this price before, I don’t recall seeing them. I can’t recall, either, seeing a strong pitch for cards on the lease line at The Reject Shop. While their shopper is not ur shopper, I look at the price and think how low will they go?

As for the cards, they are what I expect for the price, cheap, flimsy and clip-art graphics. However, they would only have them if they sell.

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Greeting Cards

ALNA facilitates meeting between WA Premier and newsagents on Lotterywest refit costs and challenges

On February 1, 2017, Western Australian newsagents have an opportunity to meet with West Australian Premier Colin Barnett at a forum to discuss growing converse about the growing costs associated with the new corporate image Lotterywest requires agents to install.

This is an important meeting that every WA newsagent who sells lotteries should attend.

Click here to see the letter from ALNA to the Premier.

Click here to see the notice for the ALNA facilitated meeting.

The core issues are the cost of the refit and the lack of economic justification for the refit. When I first saw the proposed refit in September 2015, the anticipated costs were significantly less than is the case today. On today’s numbers, it is possible small business newsagents will not achieve a reasonable return on the capital expenditure. This is not how it was meant to be.

I support the ALNA work in this area and I urge all newsagency marketing groups, newsagency software companies and other groupings of newsagents to support it. In my own newsXpress group we have shared the details of the ALNA work, with ALNA permission, and encouraged WA newsXpress members to attend this meeting. While I will be overseas, my fellow newsXpress director will be attending the forum with the WA Premier.

If you are a newsagent in Western Australia and have completed the Lotterywest refit, you may have business performance data that could be useful to the ALNA work in this area. I urge you to make contact with Ben Kearney from ALNA on ben@alna.net.au to discuss the impact of the refit in your business.

This issue feeds into the Tatts refit issue as the challenges are the same. tatts is requiring small business newsagents to undertake a considerable level of capital expenditure without reasonable financial justification for the capital expenditure. While I am not a lawyer, I suspect the ACCC may have a view about the moves by Lotterywest and Tatts.

With lottery purchases moving online at a considerable rate, it is appropriate to question the level of capital expenditure being required by Lotterywest and Tatts. Required expenditure has to be fair, justified and appropriate to the expected market conditions and trends over the period of which the capital expenditure is expected to financial perform for the business.

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Ethics

Associations and newspaper publishers

VANA is promoting what appears to be a series of News Corp. newsagent promotion event. I think associations need to be associations and not marketing arms for newspaper publishers. Also, this latest marketing from VANA indicates a visual disconnect from the national association, ALNA, with a very different looking logo.

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Newsagent representation

Kids magazines in Coles

Publishers should check out how the kids magazine area looked at a Melbourne inner city Coles supermarket on the weekend.

And if the excuse is it was there weekend that is no excuse. Any retail business that is open has an obligation to present products in the best possible way. My experience with Coles and magazines is they don’t care themselves.

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magazines

Sunday newsagency management tip: train your staff!

This holiday season, once again, people left running newsagencies while owners are away have had to work out who to speak to if something goes wrong. I got a call from a staff member left in charge seeking help with a stationery order. They called me because my card was on the wall next to the phone. Another call, at 5:45am Friday morning, was from someone wanting help connecting to the internet in the newsagency – they had no idea who their ISP was and only called me because they knew of a computer connection.

A well organised owner would provide people running their business in their absence with a contact list and simple guidance of businesses to contact for what.

Leaving staff to work out what to do for themselves is asking for trouble, it is poor management.

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Management tip

Sunday newsagency marketing tip: make locals an offer

One way to pitch the local focus of your business if to have a locals special, locals sale or a locals special day. Regardless of what you do, pitching it for locals, people who live locally, if a way of demonstrating being local in your focus. If you promote this on social media, use one or more of the the many hashtags that promote local.

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marketing

Natural growth in social media likes is better than fake growth

I saw a small retail business in Australia recently added 5,000 Facebook likes in 24 hours. They did this by paying an overseas service $25.00 for the likes. While is makes their overall likes number look good, these likes represent no tangible value to the social media strategy of the business.

There are many services offering to sell likes for Facebook, Instagram, Twitter and more. They are cheap and easily accessible.

Social media experts say that bought likes rarely engage with a retail business.

My understanding is that bought likes can also negatively impact the metrics facebook uses in analysing your page and this can hurt your business in the longer term.

My advice is don’t use these services. A smaller number of genuine likes is more valuable to your business than a larger number of likes you have paid a service to provide.

It is important to think about what you want from your social media presences before you chase size. If you want in-store engagement then the likes you want the most are the real, from people likely to shop with you.

Sure, attracting genuine likes is a hard road. However, my experience is that it is valuable. Invest the time, provide useful content and fun content and people will be attracted to you for this.

If you are in a marketing group they should provide to you a carefully thought through strategy for attracting genuine likes.

Paying for likes can open you to ridicule as people will know you have done it. The can know this by seeing a high like count but actual human engagement that is low and more reflective of lesser likes.

There is no substitute for the hard slog of real, personal, engagement. People who try and sell you a magic bullet are more likely snake oil sales people and should be avoided.

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Ethics

Supplementary question for distribution newsagents

Earlier this week here I asked distribution newsagents three questions:

  1. Do you charge sub agents to deliver newspapers to them?
  2. Do you charge sub agents to pickup returns from them?
  3. Do you pay sub agents at least the publisher mandated commission?

Now, I have a supplementary question, a judgement question:

If a newsagent is found to have paid sub agents less than publisher mandated commission and they charged sub agents to deliver newspapers to them and/or have charged sub agents for returns pickup, should they have their distribution business taken from them?

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Ethics

The New York magazine specialist

I got back to the best magazine shop in New York a couple of days ago. This is the only shop of its kind in Manhattan, serving a close population of 1.6 million. take a look from the outside:

Their window displays are nothing special but they do show off their unique range:

This is what you see when you step inside:

Here is what you see immediately to the right inside:

They do it this way because they are truly unique. Their customers want range. They come to them. They don’t have to do displays to promote.

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magazines

RISE Up is an inspiring program about retail businesses and the good we do

I am grateful for the opportunity to be at the National retail Federation conference in New York this week where they launched RISE Up:

While this is an American program, it speaks to the value of retail in Australia.

The campaign is supported y a number of stories about individuals, like this one:

Telling stories is important in any business but especially in small business retail where our businesses have many stories of local connections and engagements we could share.

I look at the NRF RISE Up campaign as a challenge for us to engage better in our businesses, to tell more of our stories so the broader value of our businesses is understood.

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Newsagency management

The Centrelink pursuit of questionable debt is indicative of a bigger government failure

Centrelink is not the only federal government organisation that engaged is a collect at all costs first investigate later approach when it comes to money. The ATO takes a similar approach.

I know of plenty of small business owners who have been pursued by the ATO as a result of a flawed data matching process.  In one case, a claimed debt of over half a million dollars dropped by 90% once the ATO considered the evidence. Sadly, it took well over a year for the ATO to agree to look at the evidence. In the meantime, irreparable damage was done to the morale of those leading the business.

What we have been eating about Centrelink = the letters they send, their appalling customer service, the inability to contact them, their assumption that threads of data stitched together can present an accurate view – is also true for the ATO.

Somewhere in government the principle of collect at all costs first investigate later must have been set. It is being pursued with vigour.

I heard from a retailer earlier this week who is being pursued for $80,000. They don’t think they owe it, nor does their accountant. Thanks to an address change and resulting lost mail, the newsagent has heard about the issue when the ATO has taken cash from their bank account. Payroll is at risk as are key supplier payments. This business could close because of the action by the ATO.

Politicians who say they care about small business and ordinary Australians need to investigate the systems of government, they need to see why the ATO, Centrelink and maybe others are pursuing their collect at all costs first investigate later approach. Politicians need to consider whether penalising someone prior to a trial is just and fair.

14 likes
Ethics

Is newsagent owned stationery wholesaler Ancol competing with newsagents for back to school?

Ancol, a Co-Operative and owned wholly by South Australian Newsagents, runs Newspower in South Australia, owns KW Wholesale, which supplies stationery direct to schools, and Lighthouse Books & Office Supplies, another business that supplies consumers. Ancol acquired Lighthouse in recent years – it was not a core business for most of Ancol’s history.

What Ancol appears to have become via Lighthouse is a retailer of stationery, competing with the businesses of its shareholders. The Lighthouse website shows some the the schools with which Lighthouse partners:

From what it appears, Lighthouse wins the schools tender to supply stationery to students, then the school directs the parents to go online and purchase through Lighthouse .

Here are some examples of pricing :

  • Glue Stick UHU 40g $3.20
  • Display book Clear front $1.90
  • Calculator Casio FX-82AU Plus11 Scientific $29.95
  • Binder book 96pg exercise $1.40
  • Markers Faber Castell Connectors 10’s $4.62
  • Obviously the school is getting a kick back from Lighthouse Books somewhere along the line , hence the high pricing, however the Newsagent misses out completely

I am curious about what South Australian newsagents think about Ancol directly competing them through Lighthouse?

While it could be argued that success for Lighthouse strengthens Ancol and this benefits newsagents.  Maybe so. But what about newsagents competing for Back to School How would a newsagent feel losing a school parent stationery sale to Lighthouse?

I know from discussions with newsagents across multiple states that Ancol prices to newsagents are considerably higher than elsewhere. Newsagents pay a premium if they buy from Ancol that must flow to retail prices, making those newsagents less competitive.

How would newsagents in the rest of Australia feel in GNS purchased a business like Lighthouse and through it chased school parent booklist purchases?

To see the retail of booklist business pursued by Lighthouse, take a look at part of a booklist for one school.

Newsagents will have to make up their own minds on this. My opinion is that Ancol should have been more transparent about its plans and given newsagents the opportunity to say it should not purchase a business that competes with them.

9 likes
Competition
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