Fair Trading action on partworks
A NSW newsagent was recently ordered by the NSW Department of Fair Trading to refund a customer $1,000 for partworks purchased where the customer was not able to complete the series because of failings in the supply model through to newsagents. While the distributor involved, Gordon and Gotch, have agreed, after much pressure from the newsagent, to compensate the newsagent, the problem of partworks supply remains serious.
On the one hand newsagents are thrilled that they are the only retail channel in Australia offering partworks. That magazine distributors ignore data (see earlier post today) and deliberately short supply harms newsagents and gets their customers off side.
The partworks model can work if the importer, distributors and newsagents actively work together. Sadly, for many years now the words have been the same and follow-up action not forthcoming.
Maybe more customers need to pursue Consumer Affairs or Fair Trading. Alternatively the suppliers could work with newsagents on a fair and commercial basis – that way everyone wins.
Selling newspapers at Melbourne railway stations
Is one of Melbourne’s two newspapers about to engage major railway station based marketing initiative? A check of this ad posted yesterday afternoon at at seek.com.au suggests so.
We are currently on the hunt for new team members to assist one of our largest clients with their new customer program.
Work will be located at outer metropolitan train stations from 5.30am to 8.30am Monday to Friday. Acting as an ambassador for this iconic Melbourne media product, you will act as a contact point for commuters to purchase their daily news hit!
If you are looking for a role that has it all- working in the great outdoors, being a COMPLETE hero as you ensure the public get their favourite media product and finishing work just in time to watch everyone else start then apply now!
Work locations include: Bayswater, Berwick, Cranbourne, Hallam, Broadmeadows, Oak Park, Preston, Regent, Carnegie, Hughesdale, Albion, St Albans, Mooroolbark & Mt Waverley.
$20.00 per hour + available incentives to reward hard work and loyalty.
If this is for a newspaper why are they hiring and not the local newsagent?
When I first read the ad I wondered if it was to distribute MX (the free daily newspaper) in a morning edition. But the ad text makes it clear this is about selling something.
If my suspicions are right and this is for a newspaper publisher sales initiative then I’d be interested to understand where newsagents fit in the model and whether there has been consultation.
GNS ignores newsagents
GNS, the stationery warehouse owned by newsagents has banned VANA, the Victorian newsagent association from having a stand at this year’s GNS Market Fair – the only trade show for newsagents. VANA has been involved in Market Fair since it began and indeed had ‘ownership’ over a decent chunk of the floor space sold at the trade show. VANA was involved in the Victorian newsagent trade show for years prior to the arrival of GNS in Victoria.
This decision and the decision to ban newsXpress exhibiting at GNS Market Fairs are proof of a Board out of touch with what newsagents want.
IT standards fail newsagents, again
Magazine distributors have criticised newsagents for years about lack of compliance. Now, the ball is on the other foot. Part of the compliance regime is that newsagents supply distributors with pre-sold data – listing the number of each title for which the newsagent has a firm order. The idea was that the distributors would use this to ensure that at least minimum orders are fulfilled – essential for partworks.
The distributors are letting newsagents down. They are not using the data and newsagents are often, with partworks, supplied fewer copies than firm orders from customers of long standing.
Newsagents are rightly questioning the value of the much vaunted IT standards.
Newsagents using software from my company account for at least 75% of the compliant newsagents providing data – one distributor says we have an 85% share of compliant newsagents. I know from talks with some of these compliant newsagents that their clear and trusted data is being ignored by distributors. They are being supplied fewer copies of some titles than their firm orders. The magazine distributor involved knows that they are failing the system they helped create – they are making the newsagent look stupid.
Newsagents who were bereted into complying and promised better business outcomes are rightly asking whether the investment was worth it.
To the magazine distributor executives reading this – fix the problem, act commercially with newsagents, work with us and help us sell more magazines. You have the data.
Shrinkage, theft by another name
Checking sales of a new wedding magazine, we were surprised to have sold six copies in a week. A 33% sell-through of a wedding title in a week in our demographic is excellent. The same check revealed we have had a copy stolen. That’s not such good news. I know from data I see at my software company that theft, shrinkage the experts call it, costs an average newsagency between 3% and 5% of turnover. While we mainly focus on processes to protect against employee theft, it is valuable to be reminded that customers can and do lift product.
Sure, other magazines are stolen – these are often away from the main traffic area. They are also smaller. This title is big – certainly not something you could slip inside a jacket or into a newspaper.
Maybe we need to frisk customers as they leave.
Young people and newspapers
Young People and the News is an interesting report by Thomas E. Patterson, Bradlee Professor of Government and the Press, John F. Kennedy School of Government, Harvard University. The report speaks to a key challenge for newspapers:
… young Americans are estranged from the daily newspaper and rely more heavily on television than on the Internet for their news. A few decades ago, there were not large differences in the news habits and daily information levels of younger and older Americans. Today, unlike most older Americans, many young people find a bit of news here and there and do not make it a routine part of their day.
The report is further evidence of why newspaper executives and others speaking with newsagents about future trends ought to be more open about the data on which their corporations are making their plans for the future.
How can it be that there are so many esteemed commentators challenging the future of a key product category yet our suppliers say it is business as usual?
Australian newsagents ought to fear ignorance more than change.
Newspaper distribution consolidation
I am curious as to why consolidation of newspaper territories is slow in Sydney compared to Melbourne and, to a lesser extent, Brisbane. It may have something to do with the different approaches being taken by publisher representatives in Sydney.
If publishers want to encourage consolidation of newspaper home delivery territories they need to be flexible in how they view the retail newsagent. They also need to better reward the distribution newsagent who is investing in the consolidation. A visit to Melbourne to review the approach of the last two years would provide an excellent blueprint.
It appears that some publisher executives want to control too much in some states. Smart newsagent operators prefer commercial arrangements which reward growth.
Proposed Supanews Federal Court action
To ensure proper management of funds, Macedone Christie Willis Solarie Partners, the lawyers representing Corie and Tammy Schwarzl – the Supanews franchisees who lost their business to Supanews without compensation – have established guidelines which will be available to any newsagent contributing to the costs of mounting a case. See this earlier post on the matter.
The prospect of Federal Court action is, I am told, causing some challenges within the Supanews Retail Group – the new business formed by the old Supanews (members of the Gaskin family), and the Pacific Equity Partners owned Angus and Robertson / Whitcoulls group. My understanding is that some senior A&R people are most concerned at the potential for damage to the reputation of their respected business. Franchisee disputes can become messy and personal.
Regardless of your view as to whether several Supanews franchisee stores have fallen over or been pushed, the Supanews model is challenged. The focus of a Federal Court case against Supanews by the Schwarzls will help various stakeholder focus their minds on the structure and its operations.
Donation to the fund can be made by direct contact with their lawyers.
Six months being carbon neutral
We have been carbon neutral in our newsagency for six months now. Not much has changed in a practical sense as we were always careful on recycling, purchasing green power etc. At least by purchasing carbon offsets we have a commercial understanding of our carbon emissions. Easy being green, the organisation we are working through, has provided some excellent material to help.
I’d encourage other newsagents to take the step. It’s a good community move.
A magazine of the future
Blanket is a new magazine in the Art and Design category. It comes out of Brisbane. What is most interesting about Blanket is that it is an online only publication.
With sales of print magazines in the same category flat or falling, an online model makes sense. Given the online focus and target demographic, it is appropriate that Blanket has a MySpace page.
Newsagents need to see that the magazine space is changing, Blanket is proof of that ever if it a special interest title. The best place for newsagents to respond to magazine changes is in our in-store fixturing – less but better designed space should help us boost sales from fewer titles.
Watch Blanket and the other online only models launching regularly.
Who will be first?
Jon Fine, blogging at BusinessWeek, asks: Which American Paper Will Be The First To Kill Its Print Edition? In his article in the magazine, Fine picks the San Francisco Chronicle. Both the blog and article are essential reading for newsagents and their publisher suppliers. The discussion challenges the views put by publisher representatives speaking at newsagent meetings in recent months.
No, I am not gloomy about the future of newspapers. Realistic is what I would call it. By understanding the changes coming, newsagents will be better equipped to make the business decisions which best suit their businesses. Newsagents have to put their needs ahead of those of their suppliers.
Change can be liberating.
Growing wrap sales
When developing the layout for our card and gift shop we decided to move from the traditional wrap fixtures. Instead we went for this unit:
We are so happy with the results that we are using an expanded version of this display in a new newsagency we are involved in. Customer feedback has been wow! and that is enough for is to copy the idea.
Certainly we notice that customers are more likely to touch the product and any retail expert will tell you that once a customer touches a product they are more likely to purchase.
Magazine Club Card coverage in the UK
The Magazine Club Card which I created in 2004 is the subject of a report in the respected Circulation Briefing newsletter by Jim Bilton at Wessenden Marketing. This is very respected international coverage for what is a local low-tech magazine marketing initiative.
The many newsagents who have implemented the loyalty program can be proud of the attention this program is now drawing.
When we first launched the magazine Club Card in August 2004 we expected it to run for six months. It continues today without a break. Unlike a greeting card loyalty program, this one works on a continuous basis – especially if you stick with the rules we developed when we launched.
Every day we receive positive feedback from our customers about the program. A newsagent who is using the program said that the Magazine Club Card is the single most valuable marketing initiative he has seen in 30 years. That is what matters to me – that newsagents are able to use this simple program to grow their magazine sales and demonstrate a rewarding value proposition to customers.
This card is better than a VIP Card or some similar points based loyalty program. It connects with our customers in a more timely and practical way. I know of a newsagency which ditched the VIP Card for this and makes more money as a result.
It would be good to see Australian newsagent journals cover the Magazine Club Card as Circulation Briefing has in the UK.
Blogging for an outcome
The situation with T3 magazine is frustrating: the two editions pull focus from each other on the shelves in a segment of the magazine space which is already challenged. I would prefer to see one edition closed down – not just in my newsagency but across the network.
I have seen enough data to form the view that newsagents are not winning by having two titles. The problem is that with each from a different distributor there is no perspective at the supply end.
I figure that by blogging about this those responsible for T3 will at least look at their situation. Sometimes I find that blogging achieves more than dealing direct with a supplier.
Ads on the front page
Mark Friesen, a news designer at The Oregonian in Portland, Oregon reports at his blog about the consideration being given at The Los Angeles Times to start permitting advertisements on the front page.
I should send Friesen a copy of The Age with ads and a post it type ad stuck on the masthead.
I wonder what designers within Fairfax would say about the debate in the US.
Australia Post shuns retail
Australia Post demonstrated the benefits of government ownership at their Forest Hill (VIC) corporate store on Saturday. While other retailers in the centre embraced the VIP shopping night to promote the opening of Meyer, Australia Post, opposite our newsagency, was defiantly closed. The Minister responsible for Australia Post, Helen Coonan, says that Australia Post competes in the retail space without any benefits of government ownership. That they can get away with closing on Saturday as well as their usual closure on Sundays is proof that Government ownership has its benefits.
If Australia Post was serious about retail and did care about its customers they would embrace opportunities such as VIP nights. Instead they revert to their public service mentality and hide behind the Australia coat of arms.
We are not car makers
Further to my post a week ago about Fisherman and Boatowner, the editor has gone to ground and is not expanding on his comments that the distributor, NDD, is to blame and that he did not mean to attack newsagents – not to me and others I have spoken with at least. The Fisherman and Boatowner situation, gross oversupply for many and undersupply for others, supports the claim that newsagents are treated poorly by the magazine supply chain – particularly in the long tail, titles outside the top 200 sellers.
No matter which KPI you use, return on investment, return on floor space, stock turn, or cash flow, smart newsagents are able to measure the cost to their businesses of the inefficiency in the magazine model. That they are denied the opportunity to make good business decisions about magazine supply is an appalling situation. Those presiding over the current supply model in the magazine distribution businesses ought to give entrepreneurial newsagents the tools to =run their businesses as they see fit – I suspect that the result would be an increase in overall sales.
Maybe Fisherman and Boatowner should close down – from retail at least. That newsagents are effectively funding the title by providing free shelf space and labour ought to be enough to see it removed from supply in all but the locations where it pays its own way. If such a move leads to the demise of the title so be it. I don’t see anyone providing financial assistance to keep struggling newsagencies open – we are not car makers after all.
Leveraging lottery jackpots
We have lottery jackpots across all games in Victoria at present including the Wednesday game: OzLotto $8 million; Wednesday Tattslotto $2.1 million; Powerball $20 million; Saturday Tattslotto $21 million. Given past success we are running a joint game syndicate based on Powerball and Saturday. This allows promoting a $41 million first division pool. No matter how we mix then, syndicates sell well as punters appear to be happy to have more chance even if their piece of the pie is smaller.
Jarryd Moore makes an interesting comment about this at his blog, asking whether going too early with a jackpot hurts sales. Our experience is that it does in the short term but once you have built a good pool of syndicate customers it does not hurt. As for regular over th counter sales, we have not compared the impact.
UPDATE: We sold eight shares in 24 hours. Today we will add another syndicate.
The blessing of Myer and Jennifer Hawkins
It has been forty three years in coming and today it finally arrived. Myer opened at Forest Hill Chase where our newsagency is located. Some say this brings the respect the centre deserves.
Myer has taken the space formerly occupied by Harris Scarfe and while they are a reasonable department store, the Myer brand counts for more. All day the centre has been crowded, long before Hamish and Andy and Jennifer Hawkins arrive to bless our good fortune. Here is the crowd from earlier today outside Myer:
Up a level and at our corner of the centre, far away from Myer, we have been enjoying Christmas like crowds. The boost is most welcome following five months of poor traffic due to major construction all around us.
I guess what is interesting to me the most about the arrival of Myer is the talk of people – shoppers and people working in the centre – about Myer adding respectability as some call it to the centre. The morale boost among shoppers and store owners is bound to have a good knock-on effect for all businesses in the centre. we can’t wait! And all before Christmas! Between now and then a bunch of national brands new to the centre will arrive.
Being in a major centre leaves small businesses, such as newsagencies, at the mercy of the strategies of the leasing manager and the major tenants. No matter how hard a small business markets itself, it is difficult to overcome challenges of the location and the tenant mix. At Forest Hill at least we are looking at the best of times in our eleven years so far.
Boosting Donna Hay
Nothing against Donna Hay but the magazine bearing her name does not sell that well in our newsagency. The Donna Hay kids issues, however, sell exceptionally well. So, the brand is not the problem with our sales.
Looking at food titles generally, Delicious sells well (sells out since our supplies have been cut) as does Gourmet Traveler. Donna Hay is the weakest of the mix yet we receive more copies than the other two – ah the magazine supply model starving and drowning all at once.
We are planning a promotion for the next issue of Donna Hay to reintroduce the title to our customers. This will happen at the same time we relay our food related titles – it is time for a major rethink of how we display the range. We want a better point of difference.
Famous makeover
Famous magazine has had a makeover and as a result it stands out better when in the mix on the shelf with competitors Who and NW.
We are going to use our magazine loyalty program to support the new look with a double clip option on Famous next week. While the merchandiser has created a good in-store display I feel that an over the counter offer to draw attention to the new look could help more.
The offer will also remind our team of the new look – it is hard sometimes to keep up with the changes in product at the counter.
Prince flips the model, goes free with a newspaper
With print media and the music industry both chasing rainbows online it is interesting to see Prince giving away 3 million copies of his new CD, Planet Earth, with The Mail in London this weekend. Here is what his website has to say, in part:
Always a musical innovator and icon, Prince is once again leading the charge into a new music distribution landscape, redefining tradition and setting new precedents. As well as having taken the innovative step of giving copies of his new album “Planet Earth” away with concert tickets to his London O2 dates, Prince has new plans of putting music directly into the hands of fans. In association with the Mail on Sunday publication, Prince will deliver his new album “Planet Earth” to nearly 3 million readers in the UK on July 15th.
This plan has shocked the music industry and set local retailers into chaos causing major controversy about the new future of music retailing as presented by Prince.
Kenyon Farrow makes some good points about the move by Prince at his blog.
While a free CD from Prince will not, of itself, alter the commercial fortunes of newspapers or music, it will be disruptive enough to get music and newspaper bosses looking outside the square as they navigate their future in challenged marketplaces.
Emap digital revenues up
The BBC is reporting Emap as reporting digital revenues up 34% in the June quarter. Print revenues are down in the same period.