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

Month: November 2009

Newspaper sales fall 2% in newsagencies

Analysis of the latest newsagency sales benchmark results show a decline in over the counter sales of newspapers in Australian newsagencies of 2% in September / October 2009 compared to the same period in 2008.

The newspaper results reflect a slowing in the decline of newspaper sales reported earlier this year. In the January / March 2009 quarter, newspaper sales were down 5%.

This latest study, undertaken by Tower Systems and covering 125 newsagencies, looks only at over the counter sales.

The benchmark study also reveals a 5% decline in shopping basket instances of newspapers. This is explained by the decline in sales and the expansion into new areas by newsagents reengineering their businesses. Overall newsagency sales increased 2% in the same period.

A more complete report on the sales benchmark study will be released next Monday.

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Newsagency benchmark

New low cost computer system for newsagents

newsagent_pos.jpgMy software company, Tower Systems, has released a low cost newsagency software, hardware, training and support package. It includes newsagency point of sale software, Lenovo computer, receipt printer, laser printer, cash drawer, scanner and on-site installation for under $5,000.

A short video introducing the offer here.

With fewer than 800 newsagents without a computer system, Tower and key newsagent suppliers are on a mission to get those without a system computerized and connected with the rest of the channel.

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newsagent software

Diaries for women

fhn_diaries_cards.JPGWe have placed diaries are more likely to appeal to women closer to our greeting card department since women are four times more likely to shop the card department than men. The photo shows part of this range, we have more on a stand nearby.  While this placement near cards is a logical step to some newsagents it will be innovation to others. Once you see the diaries in this location it makes sense. A small move but well worth it.

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Diaries

Vale Neville Lyons

I was saddened to hear the news that Neville Lyons of Mitty’s Newsagency in the heart of Melbourne passed away a week ago. Neville was a character in the Victorian newsagency channel. I first met him more than twenty years ago. Always ready with encouragement, Neville was an old hand who represented publishers well at the top end of the city of Melbourne.

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Social responsibility

Promoting ACP cookbooks

acp_cookbook_holder.JPGWe are promoting the free cookbook holders which come with ACP cookbooks at the moment by placing them in the magazine fixturing.  They are a nice gift from ACP and should help boost sales with cookbooks a popular Christmas gift. We have these on display in with cookbooks in our women’s weeklies magazine section as well as food. It is good to see such a practical gift.

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magazines

Selling cats and dogs

fhn_counter_pets.JPGA cute dog or cat photo will sell just about anything, especially at the counter.  Each time we bring in the small pads on the left side of the photo they quickly sell out.  This time around we have placed the pocket diaries next to the pads as they appeal to the same customer.  Our goal here is to sell two items instead of one.  Both are price for a quick sale.

Counter space is in great demand in any newsagency.  We try and maximise the return by careful adjacency placement and constantly moving product through the space.

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Newsagency opportunities

Magazine sales fell 5% September / October

Magazine unit sales dropped 5% in September / October 2009 compared to the same period last year my latest newsagency sales benchmark is showing.  The sale study shows that magazine revenue fell 3% in the same period.  This is against a 2% increase in all sales for the same period.

The 5% fall is less than half the fall reported in the January / March 2009 benchmark study.  This is good news for newsagents and magazine publishers.

The benchmark study indicates a fall in contribution by magazines to overall newsagency revenue.  In 2008, magazines contributed, on average, 14.6% of revenue.  In 2009, the contribution is 13.6% of revenue.  While this can be partially attributed to the decline in sales, it is more to do with newsagents growing revenue in non-circulation areas.

The benchmark study also shows a steeper decline in sales in larger newsagencies, those turning over $30,000 or more a month in magazines.

I’ll have more to say about the changing balance in products sold in newsagencies once I have digested more of the benchmark results.

The benchmark study includes data from 125 newsagencies using Tower Systems point of sale software covering sales for September / October 2009 and September / October 2008.

I undertake these benchmark studies to provide newsagents with data against which they can compare their businesses and, hopefully, make more informed business decisions.  I find the results useful in building a profile of successful newsagencies.  The dataset is invaluable in understanding operator performance, trends and opportunities.

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Newsagency benchmark

How others handle newspaper distribution contracts

Newsagents need to cast a wide net when looking at how to respond to the new newspaper distribution contracts sent out last week.  The contracts are too complex and the ramifications too considerable (personally and network-wide) for newsagents to make a decision without thorough research and discussion.

While others are looking at the contracts from a legal and strategy perspective, I have been hunting around online to find out how newspaper distribution contracts are handled elsewhere and have found some interesting US recent history: here, here, here and here.

Not directly related but interesting nevertheless.  The question about what makes someone an employee versus a contractor is interesting in the US context of newspaper carriers.  This made me think about the level of control Australian newsagents have to operate a newspaper distribution business.  That’s a blog post for another day.

By the way, in my searching, I also came across a Fairfax Q&A from June 1999.

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newspaper home delivery

Is this Dirt Action magazine

dirt_action_nov09.JPGThe masthead of the latest issue of Dirt Action is covered by the printing on the plastic bag inside of which the magazine is sealed.  No wonder these bags get ripped open by browsers.  While the publisher could argue that regulars would identify the magazine through the bag, this is no good if they want to grow their readership.

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magazines

Double standards from News Corp. on paid content battle?

In one world, News Corp. is waging a fierce battle with Google and others about paid content.  In the Australian newsagency world, News Limited refuses to charge a cover price which fairly represents the cost of manufacturing, distributing and retailing the product (and thereby inhibits a fair return the sale of said product in newsagencies) and refuses to permit newsagents to charge a home delivery fee which at least matches the cost of providing the service – condemning many to lose money on the service.

It would be good if the media reporting the News Corp. battle with Google would pick up on what appears to be double standards.  I’d welcome a debate about fairness and business practices.  Just as News deserves to extract a fair price for its endeavours, Australian newsagents deserve fair compensation for their efforts.

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Newsagency challenges

Promoting Famous and Gossip Girl

fhn_famous_nov0609.JPGWe are promoting Famous magazine on and around our main newspaper stand this week.  I would have preferred an alternative location but space is very tight with Christmas, Diaries, Calendars and many magazine promotions demanding attention.  We have been trying Famous with newspapers for the last few weeks and it is working well. The free Gossip Girl DVD with the magazine should appeal.

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magazines

Promoting Good Food magazine

fhn_good_food_nov0909.JPGWe are fortunate to have a terrific sample bag with the latest issue of Good Food magazine out today.  We have placed two boxes of the sample bags at the counter to make a stronger impact than just having a few bags on the counter as we would usually do in this situation.

With space at such a premium this time of the year, we are keen to sell through space-hungry stock as soon as possible.

Good Food continues to do well for us – we are achieving a sell-through of 90% and higher.  I put this down to it being a good title, our co-location approach and regular promotion.

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magazines

Why some newsagencies are more successful

mf_nxconf.JPGI spoke at the recent newsXpress conference in Melbourne on why some newsagencies are more successful than others.  I drew on sales benchmark and basket data, an assessment of industry trends, disruptive external factors and a review of margin versus costs.

Click here to see the presentation.

While aimed at the conference attendees, the presentation is a challenge to all newsagents as it explores the importance of a unique selling proposition, something which, as a channel, we have been slowly losing over the last twenty years.

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Newsagency challenges

Little interest in Tiger Woods poster

The poster of Tiger Woods which was free with the Herald Sun on Saturday failed to attract interest in my newsagencies and others I have heard from.  We offered it to customers and more than 90% of the time the offer was declined.  Meanwhile, I am told that the NEW MOON poster with the Sunday Telegraph in Sydney did very well.

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Newspapers

Wellbeing hides magazine re-launch

wellbeing_relaunch.JPGWellbeing magazine is re-launching with the new issue on-sale this past week.  They are hiding the re-launch issue in a sealed plastic bag – so much for encouraging browsing.  They are including in this bag an old issue – why do that? To compare the new with the old?  In some of the bags I received the old issue is only from two issues ago.  Hey, I paid to send these unsold copies back to Universal Magazines, the publisher.  Now I am paying to give them space to try and sell this old stock again.  The bag is too big to fit multiple copies per pocket.  This forces Wellbeing onto the already full flat-stack area.  Maybe the publisher is smarter than I think.

The best way to re-launch a magazine is to make it accessible – easily browsed – and to promote it for the future, not by looking back at the past.

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magazines

Sunday tip: put tape with wrap

frank_wraptape2.JPGThe team at our Frankston store is driving more valuable wrap sales with a good display os wrapping tape displayed with Christmas wrap.  Talk to the experts at Scotch (3M) and they will tell you this works for the majors.  Every newsagent should copy this idea.  You can display whole panels as at Frankston or clip-strips of tape if you have less room.  We do this in our gifts shops too with good success.  This is an easy way to extend the basket and sell across product categories.

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marketing tip

Developing the new newspaper distribution model

For years now, newsagents have been waiting for new newspaper distribution contracts.  News Limited has finally delivered theirs this week.

Having refused to negotiate terms with newsagent associations, newsagents are having to make their own assessment.  I have received a bunch of contracts over the last 24 hours and will go through these in the next week.

Looking at a contract last night for the first time, it is clear that we are transitioning the newspaper distribution model.  It makes me ask what initiatives have newsagent associations taken to develop a new model?  I stand to be corrected but I suspect not much.

A smart association would have funded an international study on newspaper distribution, a study from all angles – publishers, wholesalers (in the UK), newsagents, delivery drivers (newspaper carriers in the US) and consumers – and had the various newspaper distribution systems professionally assessed.

The resulting report would have ensured that newsagents today would be better informed about the likely future of the model from a publisher perspective as well as the best model for newsagents themselves.  Newsagents could have contributed to the shape of the future as enshrined in the contracts – the quality of the research and analysis would have driven this.

Instead, associations have left publishers to take the lead and the best they can do now is respond – as newsagent associations have done, poorly, for decades.

It is not too late for newsagents to have a say in the future of newspaper distribution.  The new contracts provide a few years for newsagent funded and owned research on what the future of newspaper distribution looks like. Newsagents will only take this step and ownership of their future if they want a say in this.

In a practical newsagency sense, I am disconnected since I sold by distribution business three years ago.  However, my software company, Tower Systems serves 1,600 Australian newsagents and is committed to dhelping newsagents improve distribution efficiencyand returns.

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newspaper home delivery

Magazine awards for 2009 announced

Beter Homes and Gardens from Pacific Magazines was announced Magazine of the Year in independently judged awards given by AdNews yesterday. Mass Women’s Magazine of the Year award went to the Australian Women’s Weekly from ACP Magazines. delicious from News Magazines was announced Best Food and Entertainment Magazine.  I don’t have details on other award winners.

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magazines

NETT# magazine blocks competition

fhn_nett_scrimping.JPGOkay, now I know how NETT# magazine gets to be “Australia’s #1 Small Business Magazine” – they block the competition.

The photo shows how the header their merchandiser has placed behind their title this week covers up another Australian business title.  This is disrespectful of the other title and disrespectful of the retailer.

Publishers need to understand that a good magazine department works on respect and co-operation and not by trying to block a competitor.

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magazines

Taking space from other magazines

fhn_health_smart_gloves.JPGHealth Smart from Reader’s Digest is pinching space from other magazine titles with their flag-like promotion for the free shower gloves which come with the current issue.  While this works for their title, it blocks the next title along.

Health Smart is fortunate to have funds for a merchandiser to visit and grab this space – with little regard for other magazines on the shelf.

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magazines

Too much hair

fhn_hair_nov09.JPGCheck out how the magazine supply model can work for newsagents:  Here are supply and return numbers for hair magazine from April – Supplied 3 / returned 2; 3 / 2; 3 / 2; 3 / 3; 9 / 5; 9  / 9 and now the last issue: 9 / 8.  Network servicers has this data yet they continue to supply a crazy quantity.  While they will say I can go to their website and adjust the numbers, I should not have to do this for a push model.  A good push model will respect the retail network and not have pull-like services for adjustment as we see today.  Don’t tell me to control what you control from the getgo.

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magazine distribution
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