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

Month: October 2010

Blackhawk gift card sales take off in newsagencies

blackhawk-giftcards-art1.jpgI am seeing excellent sales numbers for the Blackhawk gift cards with iTunes gift cards leading the pack followed by Sanity, Jay Jays, Mitre 10, Dymocks, Super Cheap Auto and Angus and Robertson.

The gift cards are being sold with a greeting card more than 75% of the time, meaning a nice margin add-on for an already high margin sale.

While newsagents cannot build their future off the sales of gift cards, they can quickly and easily bank a higher margin from existing traffic today.  This is the important next step to navigating to the future – building a better business today off of the traffic we have today.

the number of newsagents selling gift cards has quadrupled in the last few months and I expect that to grow considerably over the next few weeks as we head into the prime gift card season.

The latest extension to the gift card range further leverages existing newsagent traffic even further.  The smartbox range offers experiences in a unique format for newsagencies. The price point provides another excellent margin building opportunity for newsagents.

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Gifts

Network Services update on XchangeIT issues

Network Services just issued the following update about the XchangeIT service gateway outage today:

We’re back up now, new files coming through are being processed as expected. As for the backlog of files, we’ve move these into a temporary folder and will push these through in batches so to not create another back log, preference will be given to Returns Files which we hope to push through tonight and then sales files over the next few days.

Hopefully newsagents will get the files they need for tomorrow’s magazines.

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magazine distribution

VANA election update

Click here to see a copy of a communication from VANA Board candidate Trevor Mason to Victorian newsagents yesterday.

I am left wondering if Trevor wants $100,000 of VANA’s finds for his project or the four or five times that amount which I understand he originally sought from  VANA.

If Trevor wants to engage in the commercial structure and operation of newsagents he ought to do that through the commercial structure he has established already. If the riches which he says he can unlock for newsagents are so real then the numbers will stack up and newsagents will support him, commercially.

To try and support this business venture VANA, as appears may be the agenda with this election, would be an abuse of the resources VANA and its members have built up over many years.

I am all for change in the newsagency channel and in newsagencies themselves and write about it here often.  However, that change must be driven and controlled by the shareholders and not an industry association which is a servant of its members.

I see data from many newsagencies.  There are some excellent success stories out there of people reinventing their newsagencies, building customer traffic and profitability. Unfortunately, too many newsagents will realise too late that they should have been doing this. This is their problem and not the problem of the associations.

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Newsagent representation

Newsagents: checkout your local Coles

supermarket-mags.JPGIn October last year I wrote here about work being done by Coles supermarkets in experimenting with and developing an in-store newsagency model.  I had seen the first such model at Bayswater in Victoria.

Today, a year later, Coles continues to experiment.  From what I have seen, their work on this project is paying off.  They are delivering browser friendly newsagency like experiences inside supermarkets.

Whereas in the past a magazine purchase was often on impulse at the counter, now, in one of their new style stores, you can see people browsing just as they would in a local newsagency.

Look at the photo from a suburban Coles supermarket I visited last week.  They have an excellent layout, presenting over 400 magazine pockets. Plenty of these are full face.  The professional signage makes navigation easy.

I expect that Coles is looking to deliver a similar look and feel to greeting cards and that cards and magazines will be next to, near or opposite each other in a wider than usual (for a supermarket) aisle.

While Woolworths is not as advanced as Coles is with its ‘newsagency’ project, they will follow. This is what supermarkets in the UK have done with terrific success. Coles has people from the UK working with them on this project.

Newsagents can respond to this challenge, many are. But we can’t wait.  We must act today on our businesses otherwise we will wake up a couple of years down the track and wonder where our customers have gone.

Australian shoppers are not as loyal to newsagencies as we would like to think.  The Coles offer is better than that of many newsagencies and once shoppers enjoy satisfaction from the experience I would expect them to return.

While we can complain about the power of the big two supermarkets, nothing has stopped us reinventing our retail model. Sure, some newsagents have, but not enough.

The one key barrier to us reinventing ourselves in the magazine space is the lack of control we have over range and supply volume.  The relationships between magazine distributors and newsagents dilutes our opportunity to be competitive with the two big supermarkets.  However, that is a topic for another day.

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Newsagency challenges

Great Christmas display stand for Better Homes

bhg-christmasstand.JPGPacific Magazines continue to create excellent impulse purchase stands for their magazines.  They are strong. They carry plenty of stock and often multiple titles.  They look good too.

The stand we received yesterday for Better Homes and Gardens is no exception.

I appreciate these stands more now than ever – in our temporary 97 sq m newsagency at Forest Hill. This stand is flexible and helps us promote these titles in a way which would otherwise not have been possible or practical in our tiny space.

Now before people shoot off comments, I know that not everyone gets these stands – they go to high volume stores.  Those who did not get the stands could look at the slimline model and maybe have something made.  This way, you control the titles in this impulse unit.

Note to other publishers creating stands for newsagents. Check out the pocket holding Prevention.  Pacific even provided an insert to snugly hold this smaller format title.  That is good attention to detail.

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magazines

Ecopolitan cards very popular

ecopolitan.JPGThe new ecopolitan range of cards from Hallmark is proving to be very popular with customers.

Printed with a soy / vegetable based ink on 100% recycled paper, customers get the environmental message and love the cool designs of these cards.  The designs are from a US card company called Sunrise Greetings which Hallmark acquired in 1998.

The recent federal election shows the growth in interest in Green matters among voters so it stands to reason that newsagents make a conscious decision to carry a broader range of green products – like these cards from Hallmark. This is why we are promoting the range in-store.

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Environment

Man Bites Murdoch – a book for newsagents

guthriebook.jpgI wonder how many newsagents will buy Man Bites Murdoch by former Herald Sun Editor Bruce Guthrie when it goes on sale today.  I plan to.  Interviews I have heard and seen so far suggest that it will be of considerable interest to media watchers and newsagents alike.  I will be particularly interested to compare Guthrie’s book with Michael Wolff’s book, The Man Who Owns The News, which I read earlier this year.

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Newspapers

Wal-Mart to sell the iPad

Wal-Mart confirmed yesterday that it is to start selling Apple’s iPad from October 15.  The Wall Street Journal has the story.  This is an extraordinary move by both companies.

The cynic in me wonders if this move has been co-ordinated with Opwah Winfrey’s recent comments about the iPad.

When I started writing about the new Apple device long ago people said that it would be a fad and not impact print media.  Wal-Mart’s endorsement is further evidence that the iPad journey is far from over.

There is still no information from Apple about it expanding its retail coverage here in Australia.

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Media disruption

Having fun with calendars

fun-calendars-2010.JPGWe are having fun with calendars like LIFE IS CRAP by placing them where they will be noticed – to drive impulse purchases of calendars.  While people with a special interest will seek out calendars for dog breeds, trains, volcanos and other interests covered by our calendar range it is the fun quirky calendars which we can sell on impulse just by placing the calendar tactically.  This is why we seek out these quirky calendars and give them a couple of days in a high profile location.  Already this season we have achieved some excellent impulse business.

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Calendars

VANA election statements

Click here to see a copy of the statements issued by VANA on behalf of the two candidates for the one vacancy on the board.

Based on the statements from the candidates it is clear that there is a considerable difference between the two.  Robert Wade proposes that VANA act as an association, serving the needs of newsagents.  Trevor Mason appears to prefer commercial activity through VANA.

As I understand it, if Mason is elected, a block of Directors would support his agenda.  I’d welcome comment from and Board member to confirm or deny this.

If I was a VANA member I would not be supporting Mason.  I know a bit about his model based on my own discussions with him.  I do not believe that he has a plan other than to take care of himself. He is an excellent salesman without a track record of relevance to the needs of newsagents and the newsagency channel in my view.

This all matters to newsagents around the country as VANA has more resources than any other newsagent association – thanks to astute property moves started in the 1990s when the association was pulling itself out of a mess left by a former CEO.

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Newsagent representation

Greener newsagents saving paper

runlist.JPGMore an more newsagents are eliminating paper from their businesses by using devices such as the iPhone, Android based phones and even Apple’s iPad for tasks which would previously have been done using paper.  The Samsung phone in the photo is being used as an electronic newspaper home delivery run list.  This list is generated by newsagency software and dropped onto the phone in a matter of seconds.

I know of some newsagencies which have eliminated up to fifty pages of printing a day by providing access to delivery runlists to drivers electronically.

This is a good green story for the newsagency channel. Add to it the move away from paper printed monthly accounts to electronic accounts sent by email and the viewing of newsagency management reports electronically rather than in print and you can see smart businesses cutting printing costs, cutting carbon emissions and reducing paper usage.

Now if only we could reduce paper wastage from magazine returns.

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Environment

Covering magazine cover art with a price sticker

paranormal-coverup.jpgThe new low price sticker on the cover of Paranormal which went on sale yesterday obscures a key image on the magazine cover.  While I can understand Gotch wanting to pitch ‘new low price’ I think they covered an important element of the cover artwork – is it the face of Jesus?  Now before anyone gets het up, I think it’s a bit of a laugh.  Personally, I don’t take this magazine too seriously.

While I am on about these new low price stickers though, I have seen them on several issues of imported titles in a row, indicating that the price is not so new.  Indeed, this was pointed out to me by a customer on the weekend.  They said it was false advertising.

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magazines

Promoting the covers of Harpers Bazaar

frank-bazaar.JPGOur Frankston store has done a terrific display promoting the two covers of Harpers Bazaar.  This issue cashes in on the confusion over the announcement of the winner of Australia’s Next Top Model.  The column covered with the display (click on the image for a larger version) is covered on all four sides – each promoting a different magazine.  The Bazaar display is what customers see as they enter the store and head to the magazine department.  It is also next to our main newspaper stand.

At my Forest Hill store, all bar one copy of Bazaar came with the Amanda cover.

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magazines

Promoting Good Health for impulse purchase

frank-goodhealth.JPGWe are promoting Good Health magazine to customers at our Frankston store as they exit the business into the shopping mall.  We chose this position for the title with the feeling that it works as an impulse purchase as customers head to the counter or leave the store.  Who knows?  Decisions about the best location for a display are a challenge.  In our case, we have two intrusive columns to cover and magazine displays dilute the intrusion.

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magazines

Read your newsagency marketing group contract carefully

I have been asked by a newsagent to look into their situation with a marketing group which they want to leave.  Their reasons for wanting to leave are not central to this blog post except to note that in my view they are legitimate.

Like many newsagents signing for something which sounds like a money spinner (remember Bill Express?), they signed the marketing group contract without reading the detail.  It turns out that they have a five year contract and a further year during which they cannot be part of any group.

This store is in a shopping centre which requires them to be part of a marketing group.  So, they cannot leave as they aree required to be part of a national group.  The only way out of the marketing group is for them to sell their business.

I have suggested that the newsagent take the matter up with an appropriate department in their state as well as with the ACCC.  I suggested the ACCC as the contract is not fair in its handling of this situation.

They have apparently been told by the marketing group that they can leave is they buy their way out by paying the marketing group tens of thousands of dollars.  I suspect this is the amount of money the marketing group would have made off the newsagent.

Even if they stay with the group under sufferance thinking their time is up at the end of 5 years and they can then move on, it still all falls to pieces because of the one year of being required to bot belong to a Marketing group, they then find they cannot debrand or leave the group as some landlords will not allow a non branded Newsagent in their centre especially for 1 year.  This is a year of no marketing and no branding – I’d expect sales to be lost as a result.

Plenty of newsagents are happy with the marketing group in question.  My concern is what happens if someone is unhappy.  Why the need to lock them in?  It is not as if this group is investing any money in the business.  Bill Express locked newsagents in and look at what that cost the channel.

Newsagents looking at any marketing group need to read the contract carefully.  Do not believe the sales pitch, believe only what is in writing as it is this which will dictate the terms of divorce should it come to that.

The friends I am helping will know in a couple of weeks whether their latest efforts at divorce will work.

Disclosure: I am a shareholder in and a Director of newsXpress, the newsagency marketing group serving 175 proactive newsagents around the country.

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newsagency marketing

Lindsay Lohan mug shot helps sell Famous

famous-jono.JPGFamous magazine is running a promotion in selected newsagencies whereby customers are invited to stick their face in a cut out of what looks like one of the many Lindsay Lohan mug shots.

This is a fun competition designed to get shoppers interacting with the title – different to the usual posters and display stands which publishers use.

I like that there is a pocket for stock of the magazine on the front of the stand.

We have our stand facing out into the shopping mall – I figured this should work well given that the display is eye catching and is a newsagent only promotion.

The model in the photo is Jono from our newsXpress Forest Hill store – our magazine manager.

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magazines

Talking about the future of magazines

The San Diego NBC News Channel ran this story on the future of magazines on Friday.

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Media disruption

Nice Wiggles giftcard tie in

wiggles-giftcard.JPGThe Wiggles gift card we get from Blackhawk is providing a nice tie in for other Wiggles products newsagencies carry.  Many of us carry Wiggles branded cards, wrap, bags and the magazine already.  The giftcard gives us something we can easily sell to these customers in our stores.

The more we target products to the groups of customers we attract to our stores the greater the efficiency we can derive from our customers.

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Gifts

Halloween showing 15% growth

halloween2010.jpgHalloween sales so far this year in our newsXpress Forest Hill are up 15% on 2009.  Our 2009 sales were up more than 10% on 2008.

This year, we have more competition in our centre with four locations offering Halloween product including Coles which is just opposite us.  This competition is terrific as it promotes a season in which we have been well established for years.

It works particularly well where mum or dad shops with us for a card or a magazine and any kids in tow browse the Halloween table.

With three weeks to go, the best is yet to come.  Halloween 2010 could be the best season of the year in terms of year on year growth.

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Newsagency opportunities

Boxed Christmas cards kick off

boxedcards-2010.JPGOur boxed christmas cards have been out for a week and we are seeing some good sales already.  We have them in the highest traffic location in store – customers hearind to the sales counter pass them.  While we will move them, our feeling was that chasing impulse business was the best approach for the first couple of weeks.  It’s working nicely.

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Greeting Cards

ACCC informal review of Network takeover of NDD titles

The ACCC has been conducting an informal review of the take over of some magazine titles by Network Services which were being distributed by now closed NDD.  Click here to link to the page on the ACCC website detailing the review.

While I was aware off the review, as I was approached by them and interviewed, I was not aware that it had been announced publicly.  It would have been good for the ACCC to advise the newsagency channel rather than just list it at their website.

I know from my discussion with them on this issue and a recent discussion on another issue that contact from newsagents direct to the ACCC backed by data from their newsagency is useful to the ACCC.

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magazine distribution

Ripping up the front page of the newspaper

hs-oct9.JPGThe Collingwood AFL Grand Final victory book with the Herald Sun today is very popular.  I am surprised that customers don’t complain when we tell them we need to rip out the coupon.  That front page story is not as important as the Collingwood book I guess. The coupon for the book and the free seeds today are on the bottom left corner of page two.

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newspaper masthead desecration
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