Further to my earlier post on the shopping basket analysis for 53 newsagencies, I’ve been looking at what sells with each of the top 5 performing categories in city based newsagencies.
1. Newspapers
a. Sold alone 66% of the time.
b. Top companion categories (in order): Magazines (10%); Lotteries (5%); Photocopying (2%).2. Lotteries
a. Sold alone 65% of the time.
b. Top companion categories (in order): Newspapers (9%); Magazines (7%); Tobacco (6); Confectionery (5%).3. Magazines
a. Sold alone 48% of the time.
b. Top companion categories (in order): Newspapers (16%); Lotteries (10%); Confectionery (6%); Greeting Cards (5%).4. Tobacco
a. Sold alone 60% of the time.
b. Top companion categories (in order): Confectionery (8%); Drinks (6%); Lotteries (6%); Newspapers (5%); Magazines (5%).5. Stationery
a. Sold alone 30% of the time.
b. Top companion categories (in order): Newspapers (11%); Magazines (10%); Cards and Wrap (4%); Lotteries (4%).
This data does not account for multiple visits in a week from customers. However, there is anecdotal evidence to suggest that city newsagencies see customers 3.5 times a week.
This category level data underscores the risk to newsagents if key traffic generating categories are lost to their channel. For example, if lotteries pursued a more online model or a broader retail model (as expected following the shake-up likely to follow the public float of Tattersalls later this year) significant sales are at risk.
Most alarming in this analysis is the number of times sales from the top five categories are for items sold alone. Customers are visiting the newsagencies, purchasing the item and leaving. No up sell. Low retail efficiency. Bad for the newsagent, bad for suppliers of other products in store.
Newsagents are the second most visited retail channel in Australia yet this small sample suggests that the channel is not as successful at leveraging that traffic as another channel might be.
I’ll be using this data and more detailed analysis in the coming months to encourage newsagents to improve efficiency of their businesses as measured by shopping basket analysis.