It feels to me like there has been increased marketing activity in supermarkets with magazines. This week, for example, Woolworths has a box of cereal for $2 if purchased with Woman’s Day. There is a floor stand at the end of the cereal aisle. It’s a terrific promotion.
This promotion would be entirely supplier funded. The stock, the floorspace and the merchandising would have been paid by the promoted suppliers. It’s how supermarkets work.
It feels to me like we don’t see as many of these promotions in newsagencies. I am guessing this is because we do not have the consistent format or supermarkets or the one stop buying power for a such a large network of stores.
Magazine publishers need to think about these promotions before they give supermarkets a better value proposition than newsagents. Do you really want to migrate a magazine shopper from the newsagency channel, because that is a consequence which could flow from these better value promotions?
Newsagents offer the lowest cost sales and promotions opportunity for publishers. Supermarkets have a higher cost base which will only increase with their market share of magazines.
While some newsagency marketing groups access some excellent deals, the broader channel is missing out and this poses a risk for magazine publishers and for newsagents.
And we wonder why supermarkets magazine sales are climbing . publishers are coming across as being helpfull latley , how about they tell us what they are doing for the woolworths and coles out there .
Very easy to just throw up one’s hands because it’s just too bloody hard, when we have a week or two of ‘feelgood’ stories of engagement with publishers, and yet stuff like this continues to rise like a pall of toxic gas in the background.
Y&G, yes, it speaks to the fluid nature of magazine distribution.
There is no doubt that some publishers are more engaged – at an overall channel level as well as through one or two marketing groups.
There is also no doubt that publishers are challenged to reconcile their supermarket and other relationships in the context of the newsagency channel.
This is why I go on about dumb early returns, as opposed to justified early returns. Dumb early returns push publishers away from us.
Really can you blame publishers?The newsagency channel is so divided we have the good,the bad and the down right ugly.It would be interesting to see the compliance of newsagents on giveaways and promos.Sure we have some that go above and beyond but we still have many that won’t do a thing to help promote titles.With supermarkets and petrol stations they do as they are told.All promos have 100% takeup.Shame our channel can’t do the same.
Now I will wait for the usuals to come and have a go at me but this time I speak the truth and if this chanel wants to survive we all need to do the promos the publishers offer us.Not send back 95% of a new title because I felt like it.
Mary this is the point I was making in the 4WD post. The behaviour of some newsagents is putting supply to our channel at risk.
Our channel is as strong as the weakest link. This is why good newsagents need to consider no longer identifying as part of the channel.
There is an interesting article in inside retailing called Commoditisation ‘kills’ brands. It talks about a strong brand being dragged down by discounts and over exposure to cheap offers.
One day mags will realize that by linking themselves to trash giveaways and supermarket promos they are only hurting themselves as people will no longer pay the cover price without more and more extras and that the supermarkets will use them up and spit them out.
We are like others and have reduced our mag real estate for other more profitable departments because we will no longer carry mags as a loss leader. All departments need to return a good profit or they are replaced and unless the smaller publishers change the way they do business with us , just like the supermarkets it will not be long before we only stock the fast selling titles which make up the bulk of our sales and have high turnover. Why should we pay for non profitable niche ( by non profitable I mean sit on the shelf for long periods and then we pay to return) when all the profits are going into promoting other channels? For too long we have seen our niche customers being enticed away by cheap subscriptions offers that it is a no win situation for us, it is the publishers choice to go into supermarkets but they cannot expect us to be here with open arms when they get shafted and it will happen.
For months Coles near us has had tip ons ,diplay bins eg womens weekly +others but it seems all is not well now they have cut the check out display to 1 and put the rest down the no go area ,our sales have increased. We will still look for other sales to replace mags,because agents will always be second to supermarkets, WHY I DO NOT KNOW
Mary,
I’ll speak for supermarkets (both major and independent) and say they most defiantly do not do what they are told.
In the independent supermarket industry there is naturally compliance issues. The problem is obviously not as bad as in the newsagency channel – but it is something that the industry, especially over the past 5 or so years, has been progressively addressing.
However, that is not to say that even independent supermarkets that are generally compliant with their banner group do what suppliers want. If something isn’t working, or they think things are going in the wrong direction they’ll make it known. If suppliers want to do promotions they have to make it work for the stores. That means additional income either through payment for space, increase margin, or something else. If stores aren’t getting something out of it then they’re less likely to participate.
One of the major problems with supplier promotions in the newsagency industry is that they are most often offered to the entire industry, rather than to smaller groups where compliance can be managed. The other major problem is that suppliers often offer newsagents very little for running promotions. A tiny increase in margin for a title that is not a top seller does not cover the cost of allocating promotional space when the sales increase is going to be minimal in terms of dollars. Offering a promotion but failing to provide adequate display options can be disastrous – supermarkets get access to all kinds of stands and POS where newsagents are expected to use their existing fixtures. And the worst of them all – suppliers offering newsagents the “chance” to win some form of reward or cash if they participate (usually with a display). If I’m allocating valuable space to a promotion I expect that it WILL increase the bottom line, not that it has a 1 in 1000 chance of doing so.
Major supermarkets are a different beast altogether. Suppliers take to them very good offers and they say yes, no or ask for changes to their benefit. If it isn’t compelling enough for the retailer then they simply get turned away because they can’t go into individual stores and try to convince managers otherwise (well, I suppose they can if they wanted to risk having all their product pulled from the shelves).
Just maybe the Majors are starting to realise what a generation of previous Newsagents once new……you can make money from Magazines !!!!