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

Month: January 2007

Newspaper home delivery woes

The theft of home delivered newspapers is a worldwide problem as this blog post by New York resident/writer/journalist Dimitry Kiper shows. No matter whether you’re in rural Australia or high rise New York, there are tight ar*se people who prefer to steal a newspaper than buy one. In our small newspaper distribution round it used to cost us at least two or three newspapers a day – newspapers our distribution people were certain they delivered.

I wish there was a way we could humiliate these petty criminals. Two hundred years ago people were transported from England to Australia and a life of hard labour for stealing less.

I found Dimity’s blog post courtesy of Jeff Jarvis’ BuzzMahcine.

0 likes
Newsagency challenges

Free WiFi trial at newsXpress Forest Hill

We will offer free WiFi access from our newsagency in Forest Hill Victoria on a trial basis from Monday next week. We’re working up promotional material which provides context for the trial. Part of our pitch will be that we’re helping our customers go beyond the pages. It will be interesting to see how it goes.

Forest Hill is way out in the suburbs of Melbourne. It is not a commuter heavy area so I’m not expecting huge numbers. This trial is more about seeing whether such a trial has any value in the ‘burbs.

0 likes
Media disruption

Marie Claire hides its brand

marieclaire.JPGOops. I reckon that’s what execs connected with Marie Claire will be saying when they see their product on in newsagencies this month. Check out the photo to the left. It’s a waterfall display of Marie Claire product in traditional newsagent magazine fixturing.

These free sunglasses hide the brand. They also require considerably more real-estate to display the product.

While the offer is good, the execution is poor. The publisher would have been better served providing newsagents sunglasses to hand out from the counter. In fact, this is what some newsagents are doing – it protects the giveaway product from damage and almost certain theft. While this initiative by newsagents takes time, it’s an example of them protecting the product and better serving their customers.

Suppliers complain about lack of compliance from newsagents on a range of fronts. Here’s an example of lack of compliance by a supplier.

0 likes
magazines

Next generation birth notices

fi_emma.JPG

Emma Riley Welsh is the first born of Simon and Julie Welsh. Simon is one of the software developers at Tower Systems. Click on Emma’s name and you’ll be taken to the birth notice Simon placed at our Find It our new online classifieds business. Birth Notices at Find It are free. This includes photos, video and sound. Newspapers ask the family welcoming a new born to fork out $50 to $70 for an old style birth notice. The guestbook also allows well wishers to make the Birth Notice living. This birth notice is another example of Web 2.0 at Find It.

0 likes
Online classifieds

Free calendar gift wins praise

nxp_cal.JPGIn addition to selling almost 1,000 of these newsXpress calendars in our shop, we mailed 1,000 to our customers last week. The reaction has been fantastic, amazing, better than we ever expected. Customers have been coming in each day thanking us for the gift and our letter. Actually, we’re overwhelmed with the kind words coming back to us from across the counter.

0 likes
Calendars

Polarised retailing affects newsagents

The toughest part of retailing has been newsagents and book selling, where sales dived throughout 2006, with a 4.5 per cent drop since June. Mr Ganz said many of their sales had been cannibalised by supermarkets.

There are signs retailing is becoming increasingly polarised.

“Top-end and bottom-end retailers are doing well but those focused on the vague middle market are struggling,” said Andrew Cavanagh, of the Australian Centre of Retail Studies.

So reports David Uren in The Australian today. I know of newsagents who would agree with the report and others who would disagree. I’d like to see the data for city versus regional / rural and shopping centre versus high street and a comparison of socio-economic areas.

The newsagents doing well, and there are many, are those who make their businesses stand for something, where they control the business. We have to be bold, not necessarily big, but bold in making a statement about what our business stands for. The more valuable we are to our customers the more they will spend.

We must create our own businesses and turn our backs on the businesses our suppliers created for us more than 100 years ago.

0 likes
magazines

Free WiFi, yes please!

free_wifi.JPGInternet speed issues aside (due to the Dec. 26 earthquake) it’s good to see PCCW offering free WiFi access at Hong Kong airport.

As I noted here a few weeks ago, I’d like to see the Government roll out free WiFi access across Australia,. Newsagents would make ideal hotspot points. I’m sure you’d find the 4,600 business owners keen to support such a national project.

A smart country needs a smart infrastructure and free WiFi wound provide an excellent backbone.

While I don’t hold much hope of any politician understanding the importance of a national free WiFi network, I remain amazed that free WiFi is NOT available in our major airports. Instead, the owners prefer to use WiFi as another revenue opportunity. Most major international airports offer free WiFi. Not ours.

0 likes
Newsagency challenges

Size does matter for a newsagency

I really like the look of this Relay shop at Hong Kong airport. It’s efficient in its use of space and easy to shop. Being shallow there is none of the dead space at the back of the store we often see in shopping centre newsagencies.

relay3.JPG

Given the average shopping centre rents for newsagencies of between $900 and $2,000 a square metre and given our lower than average retailer margin (28% – 32%) it is time we thought more about our footprint. Sure this Relay store is not as impressive as a 250 sq metre store but I bet the return on floor space is better.

I know in my shop that only 20% of our total store traffic gets to the back 50% of our space. We have tried all manner of displays and promotions. Next time I think I’ll be looking for a shallow but wide shop.

0 likes
Newsagency challenges

This penguin would have made for happy feet

happy_feet.JPGHow great would it have been to have this fella in our stores leading up to Christmas and the launch of the Happy Feet movie. He could have been the prize in a giveaway. His presence in store would have been a magnet for the kids and kids at heart. The little penguins can be landed in Australia for just over $1. I reckon they’d retail for $9.95. The big fella could be landed for around $200 – the expensive stuffing is the killer.

This is an example of how we could better tie in with blockbuster movies and events – using stuffed characters and similar items for in store promotion and offering smaller versions for sale. It takes planning and being in the know about upcoming events.

It’s too late now for the penguin but the mainland China based manufacturer I spoke with yesterday already knows what they will focus on in 2007 based on planned movie releases.

1 likes
marketing

Free daily newspapers in McDonalds Hong Kong

McDonalds stores in Hong Kong are being used as distribution points for a free daily newspaper. Check out the orange stand in this photo.

maccas.JPG

Distribution is key for free daily newspapers as recent experience in London shows. That this publisher in Hong Kong is using McDonalds says something about their target demographic and the need for free daily newspapers to use distribution channels different to traditional newspaper channels.

While as a newspaper retailer I don’t like seeing newspaper product available through another retailer, I accept that it is a consequence of the challenges facing newspaper publishers. These free daily newspapers are critical to their revenue model – just look at the success of MX.

0 likes
Media disruption

Virgin Mobile cuts newsagent commission and forgets the little guy

virgin.JPGVirgin Mobile, an Optus company, yesterday advised newsagents that commission on the sale of Virgin mobile phone recharge product is to be cut again. What used to be profitable business for newsagents is now of questionable worth. Consider this, a recharge transaction takes between one and three minutes and newsagents make, on average, a dollar gross profit. Once you allow for card fees and overheads it is, as I say, questionable business.

Virgin has a responsibility to answer the following questions for newsagents:

Has Virgin cut the commission it pays to Coles, Woolworths and Australia Post?

What commission is Coles, Woolworths and Australia Post on? (I ask because of evidence published here last year of Vodafone paying Coles 16% when it cut newsagent commission to 5%.)

Has commission to wholesalers and any other middlemen between Virgin and newsagents been equally cut?

What is Virgin’s justification given that its profits are strong and given that newsagents do not have any means of reducing the cost of providing the service?

Under corporate responsibility at the Virgin Mobile website, there is nothing about fair treatment of its retail network or respect for those who have helped build its brand.

I understand that commissions on telco recharge are falling globally. This does not make Virgin Mobile’s move acceptable. Newsagents need to achieve a fair return on labour for all services offered.

The lemming like approach of telcos to drive commissions down and down, once newsagents have invested tens of thousands of dollars in equipment to be able to do the recharge, is disrespectful. If their profit situation demanded it, okay, but it does not. Companies like Virgin have been happy to use newsagents to gain market share and now it is achieved they cut newsagents out of the game.

How socially responsible is that?

0 likes
Newsagency challenges

JPG magazine asks its users generate and choose content

jpg.JPG

JPG Magazine has cleverly reinvented itself as a community driven publication. Yes, the website exists to gather content and voted to determine the content of the printed issue. Winning photos are published in a bi-monthly print magazine and get US$100 plus a free one-year subscription. While it’s not new, this idea of letting the community vote on content, it is new in the magazine space. It makes for a very dynamic product which, in theory, should achieve excellent sales. So, the website feeds the magazine which, in turn, feeds the website.

0 likes
magazines

The Wiggles range a missed opportunity for newsagents

wiggles.JPGHere’s an example of how newsagents are poorly served by some of their suppliers.

Today, in Hong Kong, I met representatives of company which manufacturers Wiggles products under licence. The range is ideal for newsagencies especially since we sell the Wiggles magazine. The range lends itself to the plan-a-gram approach where all stores have a consistent range and retail message. Unfortunately, our main wholesaler for this type of product does not take the range. Rather, they choose two or three items and this is all newsagents see as being available and, more often than not, pass on the products. It becomes self defeating.

This is a missed opportunity. The success of our retail channel depends on smart buying. From what I have seen today, those buying for us are not as smart as they could me. We ought to have this Wiggles range, and other ranges from the same company, and ‘own’ the space.

Our range of magazines and greeting cards opens newsagencies to demographics which we can leverage for other sales. This is where those who buy for us ought to focus their attention – on products which complement the unique newsagent demographic.

0 likes
Newsagency challenges

Wrap your love

wine.JPG

Wine bags sold very well for Chrtistmas 2006. Based on what I have seen in Hong Kong today I am expecting these wine ‘boxes’ to sell well for Christmas 2007. Based on a landed price of inder A$1 the margin ought to be good. The slogan of his company is perfect: wrap your love.

0 likes
giftwrap

Is this the newsagency of the future?

An average 7 Eleven store in Hong Kong has between 200 and 300 magazine titles – many more than you will see in a 7 Eleven store back in Australia. They’re displayed as shown in the photo:

7eleven_mags.JPG

Many magazines are sealed, even non adult product. The manager I spoke with told me this was to stop people reading them. Not all stores I saw had the magazines bagged this way.

While Hong Kong leads the world in many areas, magazine retailing is not one of them based on the displays I have seen. However, considering that they carry barely 20% of what you see in an average newsagency maybe they are leading. They control their range so it must be working for them.

0 likes
magazines

The plastic newspaper

Rafat Ali at PaidContent reports that Plastic Logic, developers of flexible plastic content readers (plastic newspapers maybe?) has received US$100 million in venture funding.

The company will use the money to build a factory in Dresden, Germany to make the display modules for electronic reader products…these flexible active-matrix displays can be fabricated like the pages of a book and used to display downloaded content of books or newspapers. It will start production in 2008.

I talk here about newsagents facing a tsunami of change. The Plastic Logic funding will fuel part of that tsunami.

From the Plastic Logic press release:

“Our displays will enable electronic reader products that are as comfortable and natural to read as paper whether you’re on a beach, in a train or relaxing on the sofa at home.” stated John Mills, Chief Operating Officer at Plastic Logic. “Wireless connectivity will allow you to purchase and download a book or pick up the latest edition of your newspaper wherever you are and whenever you need it. The battery will last for thousands of pages so you can leave your charger at home.”

“Even in this age of pervasive digital content, our research shows that consumers are very reluctant to read on laptops, phones and PDAs,” said Simon Jones, Vice President of Product Development at Plastic Logic. “We still carry around enormous amounts of paper. However, people are making less room in their lives for the weight and bulk of paper and are becoming more sensitive to the environmental impact of printing to read. We believe there is a substantial unfulfilled need that Plastic Logic can meet by making digital reading a comfortable and pleasurable experience.”

This tsunami of change is an opportunity for newsagents. Now is the time to grab the surfboard and lead your business through change. Take control and choose your future.

0 likes
Media disruption

Another BOPO complaint and then kudos

Newsagents are not alone in their frustration with the BOPO card launched a couple of months ago by Bill Express. David Vennik blogs (loudly) about his experience. While David’s post, in my view, is over the top and unnecessarily obscene, it demonstrates the risk of blogging to companies and, at the same time, the value of the medium for lovers of democracy.

Newsagents are less colourful in their complaints about BOPO but just as angry over being charged up to $200 for training which lasts no more than a few minutes.

When I did the Google search which brought up David’s blog post, I also found this post at the Multiple Sclerosis Peer Support Community. That link pointed me to this discussion about BOPO at the Whirlpool forums. Fascinating.

Back to the newsagent issue with Bill Express and BOPO. Bill Express needs to listen to newsagent complaints and reconsider their decision to charge for the training. As their partners, newsagents deserve better treatment.

0 likes
Bill Express

A great newspaper stand at 7 Eleven

7eleven4.JPG7 Eleven stores in Hong Kong have a great newspaper display out the front of the shop. Apart from a few street vendors, they dominate the retail of newspapers and magazines in the city. These newspaper displays are excellent. Since their shops are only 30 and 40 sq metres they’re not trying to draw people that far in off the street. The size of newsagencies in Australia makes drawing people in essential.

By the way, check out the height of the store. Like a lot of convenience retail here, you take the least amount of space possible.

0 likes
Newspapers

Bandwidth drought due to eqrthquake slows Internet speed

HK_bldg.JPG

Residents and visitors to Hong Kong know how much we have come to rely on bandwidth in our daily lives – it’s in short supply and has been since damage caused by the Boxing Day earthquake. Far away from the skyscrapers which cover Hong Kong cables were severely damaged and this has reduced bandwidth available in the region. Hong Kong has bee hard hit. East Asia Media News reports the situation well.

Slow internet speed means people are rationing what they do online. It’s a drought of bandwidth and there are implications everywhere: from business to individuals. Even getting emails through is a challenge despite what authorities say. In my case I wanted to complete some banking and what would usually take a minute or two back home was a game of hit and miss over three hours.

While bandwidth is not a natural resource, it is as important to our lives. Many purely online businesses do not have a fallback for extended periods of outage or bandwidth shortage. I was in a shop today where they are connected to the head office for all transactions and have gone manual because of speed and reliability. People using Skype have been hit particularly hard. There are stories of prices going up if you want more bandwidth. There is also some frustration that businesses are given preferential treatment during the day.

Back in Australia we are in the grip of a dreadful drought and life with water restrictions is normal. Here in Hong Kong they are living with restrictions of a different kind. Both resources are crucial to daily living and it is not until they are in limited supply that you realise how much you waste.

I have go to now. Bandwidth is precious.

0 likes
Blogging

Farewell Shane Warne – cricket magazines surge

inside_cricket.JPGIt stands to reason that when three greats of cricket fans will want to get a hold of the magazines featuring them. ACP’s Inside Cricket featuring Shane Warne on the cover has done exceptionally well as did Alpha last month for News Ltd. While McGrath and Langer are greats of the game, it is Warne who sells magazines. Oh, and newspapers for that matter.

We have used the focus on Warne to draw attention to the range of cricket and other special interest sports magazines we sell. The sports category is surging as a result.

Newsagents need to be opportunistic like this every day. While we create feature displays around single titles as requested by publishers, we can also do well by creating feature displays based on major events and feature a range of titles. This better demonstrates our point of difference over others selling magazines.

Even though he has returned from the game Shane Warne will sell newspapers and magazines for years to come, thankfully.

0 likes
magazines

Bookazine … a newsagency in Hong Kong

bookazine.JPGNaming a business is often a challenge and the easy solution it to make up words as the owners of Bookazine have done here in Hong Kong.

Newsagency like stores are not common over here except in the major western type shopping malls so Bookazine was a surprise find.

I like the way they pitch their core categories without letting one dominate and without letting a single supplier dominate. How many newsagencies can you think of where the lottery or major newspaper brand dominate the shingle?

0 likes
Uncategorized

Optimism for 2007

newsagency_mags.JPG

I bang on here about the tsunami facing newsagents – disruption due to technology, waning publisher interest and an unfair magazine supply model. I complain about big picture and macro issues almost every day. I criticise newsagents and their suppliers. While I try and present information in a balanced way, I am, naturally, going to be biased toward newsagents.

Despite what I write here through this blog, I am an optimistic newsagent. I feel good about the future. My future and the future of the channel. While I have no doubt there will be significant consolidation very soon, the channel will survive and, indeed grow in some areas. We are entering an era where entrepreneurial newsagents will lead.

My optimism is best illustrated by new investments I am contemplating – a new newsagency in a greenfield location, a second specialist card and gift shop under the new banner group I am involved with – the first of the stores opening next month in there centre where my newsagency is located – three additional positions for the newsagency development and support teams in my software company.

Others are investing too. New people are buying newsagencies and some existing newsagents are reinventing their businesses. The key is the control they exert over their businesses.

Optimism flows from business decisions which have their foundation in research and good business data. It relies on business owners taking control of their businesses and standing up to unfair and unconscionable practices.

While I’ll continue to draw attention here to suppliers who treat newsagents poorly, I will also be a happy newsagent because, overall, things are good. Sure they would be better if 200 to 300 magazine titles died or if Australia Post stopped trying to take cash from my pocket. But I can deal with these challenges through this place and through lobbying elsewhere.

The key to my optimism is the knowledge that my business is what I and my team make of it. Hence my use of this place to lobby for a better deal and as therapy. I always feel better after a good blog.

Thanks for reading.

0 likes
Calendars

eBay hikes fees and forgets its community

findit_team.JPGeBay is applying old world principles to its online business in the fee increases announced earlier this week. I think it’s losing its way. I am conflicted in my view because I own the Find It online classifieds business which is currently in beta. However, in the journey to build Find It we have learnt plenty about the cost of developing and maintaining a classified site. I don’t see any justification for the eBay fee rises – especially their 33% fee rise for motorcycles and 20% fee rise for motor vehicles. Bandwidth is costing less, services have not improved, customer service is no better. Why the price rise?

The online world has grown around a belief in and a commitment to low or no cost use. Fee increases for use of services like eBay fly in the face of that and it is natural that the community is angry. No wonder Craigslist is so popular in the US – it remains steadfast in providing a home for free classifieds and it’s 25% owned by eBay!

When we do start charging for classified ads at Find It – all ads are currently free – ads for items selling for $500 or less will ALWAYS BE FREE. Cars and motorcycles selling for $5,000 or less will ALWAYS BE FREE. This is our commitment to the community. eBay has forgotten its commitment to the community.

More than 1,000 newsagents are our retail partners in Find It. Already newsagents are bringing car dealers on with ads as well as real-estate agents. Once we start charging our newsagents get a clip from ads as well as profit share, once we are profitable. Find It is our way of bringing online revenue to the bricks and mortar newsagent channel.

0 likes
Newsagency challenges

The bridesmade you take for granted

Always the bridesmaid, never the bride. I think that’s how the saying goes. It’s how newsagents are feeling today having received the wonderful looking Bridesmaid’s Best Friends magazine / book by Wildfire Publishing and distributed through NDD. This $12.95 title is set to remain on our shelves for ten months. Our commission is 25%. This is more book than magazine. The commission ought to be double – 50%.

While some newsagents will sell this title, many will not. The long shelf life and lack of time in newsagencies to police the long shelf life mean many will cop the ten month penalty and return the title in October. If Wildfire and NDD want ten months of shelf space in my shop they need to pay me for it. Since there is no such arrangement I am returning the title next week.

I’d like to see all newsagents who do not expect to sell Bridesmaids Best Friends in the next month return the title next week to NDD. We ought to make a statement to the distributor and publisher that we will not be treated this way.

Newsagents need to think of themselves as the bride and NOT the bridesmaid who is taken for granted.

Thanks to John Rees for tipping mo off about this title. I’d missed it this morning.

0 likes
magazines
Trending Articles

Fairfax changes approach to TV Guide, disrespects newsagents

Published on April 20, 2011

What do you think of the Powerball changes?

Published on February 16, 2018

IPS releases new magazine contracts

Published on June 21, 2011