Our sales of the new Doctor Who partwork have been considerably slower than expected. Indeed, we have sold only 20% of what we expected to have sold by this point in the on-sale.
I am not sure why this is. We have the title displayed in-store in a prime location as well as at the front of the newsagency in a good display to attract passers-by. I’d be interested to know if TV support for Doctor Who is less than we usually see for part series.
The passage of legislation through the NSW Parliament this week paving the way for the sale of NSW Lotteries has received considerable media attention in the last couple of days. A report in the Southern Highland News sums up the concerns of most newsagents.
As I understand it, newsagents have a minimum of five years regardless of who takes over NSW Lotteries. This is an opportunity to make the newsagent network invaluable in the sale of lottery products and to seize every opportunity to leverage lottery traffic into other product categories.
Knowing the five year deadline is good for business planning. That’s my glass is half full view.
A new lottery operator is not going to replace a retail channel if they are achieving a good return. It will be up to newsagents to deliver that return and make it hard for a new owner to justify to their shareholders why they should shift retailers. If newsagents do the minimum and do not proactively pursue sales growth then the operator will need to look elsewhere.
In some respects, what happens in five years is up to NSW newsagents.
Ink sales at our newsXpress Forest Hill location are tracking at 50% up on last year for the last month. This is all the more amazing when considering it is happening outside a promotion. We put the growth down to competitive prices, focusing on the top sellers and A1 posters in the shopping centre – courtesy of the landlord. The posters promote our focus on brands and competitive prices. If people are visiting the centre to buy in and see the posters they will be compelled to at least look at us. Once they do, we have them.
During the same period, stationery sales have fallen. Not through lack of attention mind you and not dramatically. That said, most days ink trading from three metres of slatwall outperforms more than 25 metres of stationery.
Ink customers are great because they are loyal once they develop trust for your range and prices. Their age and economic situation varies too. Take Forest Hill – we are in an old area yet on the weekends the centre is full of young families. Both demographics buy ink.
If any one group dominated our ink customers however it would be the older customers. I mention this because several newsagents have stayed away from ink because they saw it as appealing only to younger people.
I love this calendar. It takes the piss out of pretty the majority of calendars we and other retailers have. It’s hilarious when you see it sitting in the rack next to calendars with cute kittens, babies, flowers and other warm images on their covers. I expect this calendar to sell very well.
My software company, Tower Systems, is hosting an public online demonstration of our newsagency management software for newsagents using the old POS Solutions software. This idea was pitched to us by a couple of newsagents using POS Solutions and we thought it was a good idea.
In the session, we will draw on the experience of switching many POS Solutions users (more than 200) to our software and show how newsagents benefit from the moves. We will also show how the move is often financially rewarding thanks to our transparent approach to support fees.
This session will be held next Wednesday (Sept 16), at 2pm. Bookings can be made online at the Tower website – click here.
More that 1,500 newsagents partner with Tower Systems already.
Netwwork Services has this afternoon released an update on the progress of the XChangeIT roll out this week:
All Distributors and XChangeIT worked closely together to get on top of the issues and whilst they are not completely resolved we feel that the right short term processes and validations are in place to manage this until such time as the fixes are implemented. This week the number of missing DD2 files reported was below 3%, down from over 40% two weeks ago.
We do however have another issue that we experienced last night. An XchangeIT process caused some Network Services DD2 files to be duplicated. While most POS systems are capable of dealing with this occurrence there are some that are not equipped to identify duplicated files. To mitigate this we are going to send a headline to all agents via XchangeIT advising agents to look out for files that contain the same name and only accept 1 of them. For agents using POS systems known not to identify Duplicate Files, as an extra measure, we will be calling them to advise them of the duplicate files so they are aware they must look first before accepting files. .
We ask that you do that same via your communication networks
Any queries please let me know.
My own experience at Tower Systems has been that the improvements they note are real. It is good to see progress.
We have built a weekend magazine offer at the front of our newsagency around Money magazine. The new Money for Jam TV show is a good reason to feature the title at the front of the shop. As the photo shows we are using the opportunity to promote property related titles. The column on the far left is a long shot – crossword titles. We track sales by pocket to add to our knowledge of what works and what does not work.
The display will be changed Monday.
We are promoting The Week magazine at the counter over the weekend. It has been a while since we gave this title a nudge and I think it may work with our weekend customers. I have started reading The Week myself over the last few weeks and feel that the title suffers from being misunderstood, especially to the browser in a newsagency. One way to resolve this is for the publisher to work with newsagents on a sampling. I’d be keen to try this and help The Week find new customers.
Google is developing a micro payment platform according to Neiman Journalism Lab. If released, this and similar micro payment models will advance the cause of publishers and others looking to monetise online content which is currently free. The payment range to be handled is US1cent through to several dollars.
This move is dignificant because in the print world content is purchased in an aggregated form – newspapers and magazines. Online, content is accessed by the story yet stories are not monetised. A viable micro payment system will allow stories to be more easily monetised.
Publishers making money online will have more reason to pursue this channel.
Here is a copy of the Google submission to the Newspaper Association of America on micro payments which promoted the Neiman report.
I wonder how long before Cesar’s Way magazine, soon to launch in the US, is published here. It’s a magazine built around Cesar Milan, the dog whisperer. His recent tour here showed how popular her is in Australia.
Dog magazines are not selling that well. The segment could certainly do with a shake up. We know the market is here – dog calendars sell very well. Indeed, dog calendars are the most successful calendar segment for us and many other calendar specialist newsagents. It’s the current crop of dog magazines which need refreshing.
Hallmark is running a series of events today and tomorrow to mark the launch of their new sound cards. Click here for a copy of the PDF with announcement details. These cards deserve a bold launch – they are that different to sound cards we have seen in Australia previously.
The launch activity and associated media attention will drive traffic for the new cards. Even before this, in one of my stores, we sold out of 19 designs in nine days. That’s a hit!
We are promoting the new ACP cookbook, Healthy Babies, in our cookbook area as well as our parenting area. We will also make it a feature title in a parenting display we have planned for the front of our shop soon. By moving this title around as well as co-locating we hope to shift stock early in the on-sale life. It has worked for other cookbook releases this year. The results are better than had we just left the new titles in the cookbook section and done nothing else.
Prevention magazine launched by Pacific Magazines on Monday of this week is selling very well based on the data I have received from more than 100 newsagents. There is spare floor stock available through Gordon and Gotch. If you have having trouble accessing this let me know and I will navigate through people at Pacific for you. This process has already helped ten newsagents who have just about sold out.
Prevention is getting excellent media coverage so I expect the launch issue to have strong interest well into the on sale period. Don’t be left without stock.
UPDATE: Stock is now scarce thanks to the success of the title.
Often, brokers handling the sales of newsagencies add back owners wages to the profit of a business before determining the selling price. For someone who has not purchased a newsagency before this can provide a false view of what the newsagency is worth. They see a ‘profit’ of $150,000 a year and think that is a nice return. Once you factor in that the husband and wife running the business together put in 100 hours a week, the real net profit of the business is under $50,000.
My view is that the multiple, if used in setting the sale price of a newsagency, should be based on real net profit and that real net profit must reflect a fair wage for the owners time working in the business.
I have seen recently situations where the add-back approach results in new newsagents paying over the odds and wondering, three or four months in, why they are not making the money pitched by the vendor and their broker.
I appreciate that this is a contentious issue. It is, however, something we need to discuss and resolve. The financial health of our channel depends on new newsagents joining us on fair and equitable terms.
We are promoting some of our special interest calendars in with our special interest magazines – where we are able to create space and where the fit is good. A good example of this is our placement of the railway calendar – Great Rail Journeys from Bartel – with railway magazines in the photo. There are many opportunities as good as this in our newsagency and, I am sure, other newsagencies.
Key to our calendar offer is our broad range so it is important for us to pitch this where it is likely to have the most impact. There is a definite correlation between magazine sales and calendar sales.
It is now six weeks since we stopped offering Western Union in my newsagencies. While there have been a couple of customers complain that they have to line up in the Post Office, the impact has been negligible. The most significant benefit has been easier counter management, we are not finding someone tied up for several minutes on a Western Union transaction. Everything we handle at the counter now is focused on fast professional service. Out in the body of the shop it is a different story – we continue to provide attentive case to customers in need of assistance.
The decision about Western Union came down to return on investment – as it does with all suppliers. You cannot cut retailer margin without providing a means by which significant savings on labour can be made.
Folio reports that magazines will be moved to the rear of the store in Wal-Mart stores under a new store layout plan. magazines will continue to be sold at checkout lanes.
Supermarkets, department stores, convenience stores and petrol outlets exert more control over the placement of magazines here in Australia than newsagents. Smart publishers will work with the newsagency channel and respect it for the opportunity it continues to provide.
We have placed the Michael Jackson commemorative issue of Life magazine on a stand in front of our newspapers. we expect this intrusive yet simple display to work well for us with this one-shot title. Jackson fans will not browse the newsagency looking for this title unless they have heard about it. We are better off putting it under their noses to drive the impulse purchase. This location with our newspaper stand is generating excellent success for us – most recently with Top Gear magazine.
We are promoting That’s Life again in our prime counter position again this week. It is working very well for us in this location. We took down Bazaar having sold just one copy in two days. That’s Life will be replaced on Friday – most of our sales are achieved over Wednesday aand Thursday as is the case in most city based newsagencies. We see the relentless process of putting up and taking down displays as essential to maintaining a fresh and relevant magazine offer.
The latest issue of Lovatts Colossus Crosswords magazine makes the reason for placing crosswords nest to women’s magazines even clearer.
As seen in Women’s Weekly is printed on the cover because they know this will appeal.
For around two years we have had a column of Lovatts and Puzzler crossword titles next to Australian Women’s Weekly and our weekly womens magazines. This is in addition to our regular crossword section. I have sales data evidence from my newsagency and others that thisco-location drives sales growth in crossowrds.
The latest pitch on the cover of Colossus is a great reason to start co-locating key crossword titles.
The Sunday Times in London reported that Asus, the company credited with driving competition in notebook prices, is about to enter the e-reader marketplace and compete with the Amazon Kindle, Sony reader and other similar devices. The lower the baiiers for consumers the more devices out there and the greater attention drawn from publishers.
It appears that agreement has been reached on the legislation required to put NSW Lotteries up for sale. I am sure that NANA and the ANF will have different views on who achieved what for newsagents in this.
We have had the For Arts Sake range of cards at Forest Hill for years, they had 25% of our allocated space. While we have been happy with the performance of For Arts Sake and their cards, we have been looking to change, to continue to evolve the card offer. We have made the decision to switch the 25% of space across to the Henderson Greetings range. We looked carefully at the cards to ensure that they would suit our demographic.
What I like about the Henderson relationship is that there is no contract. This is them backing their products and services.
At the same time as introducing the Henderson range, we are working with Hallmark on refreshing their range to create a fresh new card offer.
Last week I received more proof that magazine publishers read this blog and act on the feedback newsagents post here. Australian Traveller magazine is changing its newsagent commission model – to 50% commission for the Oct/Nov issue and 30% thereafter. Newsagents contribution to this place have had a lot to do with this.
Read the text of an email I received from Quentin Long, Director of Australian Traveller magazine.
Hi Mark
Just wanted to let you know based on the feedback of agents on the blog we are changing our commission structure for Agents.
Agents for the Oct/Nov issue will be receiving 50% commission
Ongoing agents will receive 30% commission
Oct/Nov
This will be a cracker issue as the cover title is 100 Great Australian Holiday Homes. Some of the homes are flat out amazing, however we have made a big point of having all price points represented in the 100 homes.If you wanted to inform other agents I would really appreciate it. We have the merchandisers out in market talking to agents and telling them, we will be sending a note with the magazine parcels and I will be emailing agents directly as well.
If there is anything we can do to help please let me know.
This is a terrific opportunity for newsagents to get behind Australian Traveller to drive sales and reward the commitment from the publisher to our channel. There is a terrific reward for us too in better than average commission.
If newsagents do get behind this and drive excellent sales results other publishers will notice. It’s up to us what we make of this opportunity.
We are promoting DOCTOR WHO DVD FILES partwork in a couple of locations in our newsagency to make the most of this week’s launch and the associated TV campaign. We have an in-store display (click on the photo for a larger look at this) as well as a display bin at the front of our newsagency. We have a good feeling that DOCTOR WHO will deliver excellent sales, some of these from shoppers visiting newsagencies specifically as a result of the TV commercial.
I often hear from newsagents who complain about partworks. They worry that the channel is being used to drive subscriptions. I am over this argument. Instead, I like the new traffic the TV campaigns for partworks generate for us – this is a more useful focus.