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

Month: June 2012

Surprised at lack of TV show tie in for MasterChef

The latest issue of MasterChef magazine is out with an appetising cover yet little to connect the magazine with the TV show. I can’t help but feel that this is a missed opportunity. With more than one million people watching the TV show why not leverage that audience into magazine buyers. It feels to me like there is a disconnect between MasterChef on TV and MasterChef the magazine. This means lost sales for us.

We are promoting the magazine by giving it prime positioning with food titles and tile at high traffic points: newspapers (still) and the counter. Our job would be easier in TV show fans were compelled to buy the magazine.

4 likes
magazines

News Limited delays announcement to newsagents

NANA last night advised newsagents in NSW of a delay to the announcement from News Limited on their future newspaper distribution plans.  Here is part of the NANA announcement:

Following the announcement by CEO Kim Williams, News Limited’s Director of Retail Circulation, Catrin Thomas, advised the postponement of the anticipated “T2020” announcement originally scheduled for 28 June 2012.

“In light of the announcements across the industry this week, and following a long discussion with the Australian Newsagents Federation (ANF) this afternoon, we have decided that it is prudent to delay the timing of the T2020 announcement.

“This will ensure that we are putting forward a plan that builds in all the latest information. Our concern is that if we do not pause to consider the impact of the week’s announcements, that we could end up with a shorter term solution and be back at the drawing board much sooner than we would like. We are committed to creating a commercially viable and sustainable distribution network for newspapers and we will confirm an announcement date as quickly as possible,” said Ms Thomas.

2 likes
Media disruption

Best practice magazine labelling advice

It is important for us to take care when labelling magazines otherwise we can damage the product we want to sell.

The most common mistake I see is the wrong placement of the label on the cover. The barcode label should not obstruct the masthead. Publishers spend a considerable amount of money developing and promoting their mastheads and each magazine cover. A sticker in the wrong place could make it more difficult for a shopper to see a title and this could deny you a sale.

Place the label below the masthead – as shown in the example for Grand Designs Australia. This is still high enough to be seen from traditional magazine fixturing.

Place the label close to the left spine.

Train your staff to always use the same placement.

Most newsagency software packages provide a range of options for what is included on the label: MPA category, arrival date, return date, distributor, code, quantity in, type of return and more. Talk to your software company about what you can include and set your system to give you the labels you want.

Don’t label every magazine. It’s unnecessary. I don’t label weeklies or high volume monthlies

Label preference? Laser labels without a doubt. In my view laser labels are easier to read, easier to manage, take up less cover space and cost less.

8 likes
magazines

Financial year diary sales up

The diary market is as strong as ever. Sales of 2012 diaries beat 2011 by more than 10% and sales of FY12/13 financial year diaries will easily beat FY11/12.  This is a space newsagents own. Since Officeworks plays here but they do not maintain range like we do. Their prices are not great either – we are being them more than not and we are maintaining a good margin.

Our strategy for Financial Year diaries is the same as it is for most products in-store. We focus on brands. Shoppers tell us they trust brands. Brands support us by spending on marketing. It’s a win win.  Generic products and cheap brands which are not recognised brands are not investing for our benefit.

0 likes
Diaries

News Limited announces major restructure of newspaper operation

News Limited, today announced a major restructure, compressing 19 operating divisions into 5 and cutting a yet to be announced number of jobs along the way. Cleverly, News CEO Kim Williams declared a commitment to print in today’s announcement, giving commentators the headline of the week: Fairfax abandons print for digital, News commits to print. Of course Fairfax has not abandoned print and News is as committed to digital as Fairfax.

While the spin was different ( considerably better), I expect time to reveal the moves by Fairfax and News to be quite similar. Market forces, consumer demand driven by disruption to habit brought on by new technology, will make it so.  Print products will remain as long as they make money and serve the commercial needs of the shareholders.

Some in the newsagency channel have jumped on the Williams statement about print as good news for newspapers and newsagents. Kim Williams’ words need to be tempered with an assessment of the considerable investment by News in Apps for its mastheads and the relentless promotion of these. The company is investing considerably to migrate print customers to either move to digital or at the very least include digital in their means of access. Check out this quote from Kim Williams today:

Digital technology and the ever-increasing array of consumer devices and connectivity points represent an important core to the future of our company. To realise the huge opportunities presented we must ensure we have world-class resources supporting our editorial and sales teams.

It would be a mistake for newsagents to be complacent because of the News announcement today. I expect job losses to be right across the company, including some people newsagents work with today. Indeed, some of these positions have been made redundant already this year.

The plans to be announced by News on June 28 for the distribution model of newspapers will further inform newsagents and their plans.

Every newsagent in Australia needs to be working today on their business model where they rely far less on newspapers than they do today. It makes sense.

7 likes
Media disruption

Business planning for newsagents in the wake of the Fairfax announcement

Based on contact from newsagents since the Fairfax announcement of Monday it is clear there are plenty who had not been planning for the scope of change which is forecast in the Fairfax investor presentation.  Yes, print is not dead, but its future is more challenged today than last week.

There are newsagents still running very traditional businesses – retail, distribution and retail and distribution. These folks need to move quickly. They are in a race with a tsunami of change.  Yeah, tsunami is the best analogy I can use for what is happening. In fact, multiple tsunamis as I explained in the Newsagency of the Future workshops recently.

For what it’s worth, I think the most important action all newsagents can take today, as a matter of urgency, is to reduce debt. If News Limited makes the announcement some expect, this coupled with the Fairfax announcement would be noticed by banks. Newsagents will be better off if they reduce their debt levels of their own accord than under a plan forced on them by their banks. Less debt will offer more options.

If you are not sure where to start in reducing debt then you are already behind in the race. Here are some tips for immediate attention:

  1. Look at your roster. Is every hour of paid labour necessary? can you improve efficiency and through this cut costs?
  2. Take care with buying. Personally approve all orders. Be more demanding of your suppliers.
  3. Look at your own spending. An extra $100 off your debt this week is more important than a meal out.

While debt is only part of what newsagents should be working on it is the most important given that you are relying on your bank and their risk assessment. I know of a couple of banks that have changed their position in relation to newsagencies this year – for dumb reasons I would add.

Banks are looking at all business sectors but retail in particular because of what is happening online and what has been happening and is continuing in Europe.

If your debt is under control (less than 30% of the reasonable value of your business today) then the broader business plan can and should be be considered. If you’re in distribution it has to be finding ways to use your infrastructure to generate more income. If you’re in retail it has to focus on broadening the appeal of your shop – bringing people in for more reasons than currently, making the shop floor more successful at driving people to purchase more in each visit and reviewing your pricing to ensure that you are making the maximum gross profit on each item without harming sales.

Newsagents who open their doors each day without a plan to increase traffic, drive sales efficiency and reduce costs face the toughest challenges in this disrupted world.

No one will solve these challenges for us, nor should they. We own our situation … that’s what being the business owner is all about.

8 likes
Media disruption

Attending Hallmark Gold Crown Summit in Las Vegas

I have arrived in the US this morning to attend the Hallmark Gold Crown Summit with a delegation of colleagues from newsXpress. We are the only Australians participating in this best practice event hosted by the most important and most recognised greeting card brand in the world.

Outside of the summit, a group of us will participate in a series of main street retail visits in Las Vegas and, over the weekend, in New York. These retail visits are designed to tap into best practice retail situations that resonate with newsagencies in Australia.

I’ll continue blogging as I’ll be in touch with my newsagencies in Australia through remote access and other means while away. Plus, as is always the case while on the road, there is day to day business to care for – being out of the country is no longer an excuse to get work done back home.

1 likes
Newsagency management

More One Direction related sales

Sales for the new One Direction poster title which came out last week show that interest in the boy band has not waned. I stuck a unit holding the title at the front of the newsagency along with our 1D posters and sales followed.

Getting the new poster magazine in has refreshed sales for older One Direction titles which we have kept in stock for a while longer.

Our 2013 One Direction calendar arrives in store in a couple of weeks. I am looking forward to see what we can achieve with them.

0 likes
magazines

AFL Beanie Kids selling well into the season

We have restocked our range of AFL beanie Kids several times since getting the range in-store. The latest shipment arrived a few days ago and they are selling well.

I am surprised at how well the AFL Beanie Kids are selling this late in the AFL season.

Those buying them vary from fans of AFL teams, to Beanie Kids collectors to people buying gifts for others. Our sales are helped by having the stand on the lease line, facing into the shopping mall.

0 likes
Gifts

Surprised at surprise to the Fairfax announcement

The announcement from Fairfax yesterday outlining the most comprehensive restructure in the history of newspapers in Australia was not a surprise. Not to me and many others.  But plenty were surprised.

Fairfax CEO Greg Hywood had told us major changes were coming. News Limited CEO Kim Williams has told us that News, too, was preparing a major announcement on its plans for the future. While we should not be surprised by what Kim Williams announces shortly, some will be.

I have written here for almost eight years about media disruption – 985 posts in all and I’ve barely covered what has been happening around the world.

If we look at music and books we have guidance on how a major shift in how the audience engages with content can play out for the distribution channel. How many music stores are left? What are print book sales versus digital downloads? You know the answers.

But newspapers were different. We love them. We feel like we own them. John Howard, as Prime Minister, commented several times about the warm feeling of hearing the newspaper land on the front lawn. We have had a long love affair with getting our news by engaging with ink on the page. But newspaper are businesses. They live or die based on profitability.

The end of newspapers began when classified advertising moved online and while plenty in newspaper publishing businesses said it was business as usual and that print would be here for the long term, they know otherwise when advertising revenue started to decline and then fell off a cliff.

I don’t want newspapers to shrink and close. I like the medium. But times change, people change. Paper is being replaced at work and in the home. And we are experiencing just the beginning of this change.

Newspaper publishers told newsagents that the paper product will remain because they needed newsagents to be their partners to the end. Newsagents provide the cheapest newspaper delivery option available. Newsagents are part of their decay play, they give the home delivery of newspapers a longer life. I don’t begrudge newspaper publishers their view, it’s practical for them and their shareholders. Newsagents should have known better, they were warned.

What I wrote wrote in February about News Limited being in crisis in terms of newspaper home delivery was true.  The crisis was in part brought on by newsagents walking away from their home delivery businesses, in numbers which alarmed News. The announcement coming soon from News was expected to speak to the extent of the crisis (or whatever you want to call it). The Fairfax announcement could mean that News pulls back somewhat from or delays the full implementation of its plans to see how the Fairfax move plays out.

I have no doubt we will see the closure of some daily newspapers in Australia. This has been my view of some time and I’ve stated it here before and in other public forums. It’s one of several reasons why I have been calling for newsagents to reinvent their businesses, to seek out new traffic drivers for retail, to source new uses for distribution infrastructure.

I also have no doubt that we will see sales of some newspapers grow … when engaged publishers realise what people will pay for in this marketplace.

Fairfax owes newsagents nothing. The challenge is that many newsagents disagree. You can’t force a business to operate an unprofitable operation. Yet that is what many newsagents have done for many years.  Maybe the Fairfax announcement yesterday will shake these newsagents to take charge of their own situation.

I am not changing my business plan in the wake of yesterday’s announcement. I will continue to focus on broadening sources of traffic for my newsagencies.  I’ll continue to adjust the product mix and placement to increase the basket size.  I will drive margin when I see an opportunity to make a product more valuable to the business. I will do all this without disrespecting traffic I get today from core newsagency lines like magazines, greeting cards, stationery and, yes, newspapers.

Here is what has changed in case newsagents missed it – just a few years ago we could rely on newspapers to deliver 50% or more of our foot traffic every day.  80% or more newspaper sales were for a paper and nothing else – most likely from people who would come back in another visit for other purchases.  As they purchased fewer newspapers they thought less of the newsagency for the other items. If we did not maintain our relevance outside newspapers we lost some of these previously welded-on shoppers.

Newsagents who have not replaced newspaper traffic and have been surprised by the Fairfax announcement need to move quickly to rebuild relevance and to bring in new traffic.

I’ll gladly help any newsagent feeling challenged by what is happening.

21 likes
Media disruption

Brilliant promotion of Slow Cooker 2

Check out the display created by the team at one of my newsagencies to promote Slow Cooker 2 from ACP. This display cuts through visually, it makes the title the hero. I love the less is more approach. When I first saw it I felt wow!

While I love colourful posters for promoting magazines, I also like to see the use of collateral that frames and or underlines the product itself. That’s what has been achieved with this display for Slow Cooker 2.

I love that we regularly promote magazines in a non-corporate and more engaged way.

3 likes
magazines

Embracing the Inked magazine opportunity

We have taken care to place Inked and Inked Artists with each other to make the most of the common masthead. I’d encourage other newsagents to so the same thing.

Tattoo artists will seek this title out. Put both together and you’ve got a better chance of selling both in the one sale. Our care for tattoo titles has made us the go to newsagency in the area. Sales are up.

2 likes
magazines

Terrific InStyle offer

We have given the latest issue of InStyle magazine prime placement at the entrance to our women’s magazine aisle. The $92 worth of Model Co. make up gifts packed with this issue of InStyle make it a must buy title for shoppers, it deserves the best location.  This location made it easier for is to display the pack.

The marketing people at Pacific provided wonderful range of collateral provided.

2 likes
magazines

Promoting lunchbox cookbook

We are chasing sales of Woman’s Day Lunchboox cookbook with this tactical placement next to super food ideas, one of our top selling cookbooks. I made the decision for this placement, choosing a popular title which is purchased by someone who would be likely to be interested in the lunchbox cookbook. No sales yet but we’re only a couple of days in to this move.

Often it is the placement of a product which is more important than a display.

1 likes
magazines

Fairfax prepares for a digital only future. Are newsagents prepared?

Newspaper publisher Fairfax announced major changes to its operations today under the heading of FAIRFAX OF THE FUTURE.

The changes prepare the company for a digital only model.  Indeed, on page 17 of the investor briefing document, Fairfax acknowledges that the move to digital only is inevitable, tying remaining in print to revenue. With print revenues in steady decline for years, there can only be one end point, an exit from print.

Click on the image to see the point made on page 16 of the investor briefing. See the pie chart – 34% of the company’s cost base goes to production and distribution. The document notes these as: costs not required in a digital only model.

Every part of the announcement from Fairfax today prepares the company for a reduction and, possibly, ultimate complete retreat from print. The move of The Age and SMH to compact formats (great move and long overdue by the way), the introduction of digital subscriptions (somewhat overdue for their quality journalism offer), the closure of the Chullora and Tullamarine print sites and their digital-first editorial model make the end game clear for Fairfax … and for newsagents.

Fairfax has intensified its focus on cost cutting, targeting annualised savings of $235 million by 2015. It’s in a race again market forces as evidenced in the chart on page 12 of the investor briefing showing the Fairfax audience by media type … chilling stuff.

I suspect that market forces will impact this plan and see the company act on at least one or more of its daily mastheads either shedding some days from the print roster or move to a digital only platform before 2015. Circulation continues to decline for all but a couple of daily newspapers in Australia and this is putting pressure on advertising revenue. Page 17 of the investor briefing makes it clear Fairfax will move to a digital only model if print advertising and circulation revenue declines materially. I think this is happening.

A day by day analysis of the return achieved for The Age newspaper, for example, would, I suspect, reveal at least three days of the week to be loss making: Monday, Tuesday and Friday. I’d expect Wednesday to be doing okay because of classifieds (but only just as advertising is falling away rapidly), Thursday to be strong due to the Green Guide, Saturday to be strong due to advertising and Sunday to be strong due to a good weekend read.

If my assumptions (above) are right, we could (should) see The Age cut days. A number of seven day newspapers in the US have done this. Equally, Fairfax could switch from seven days to digital only of the cost savings of eliminating all production and distribution costs justified the move.  I think we are more likely to see days cut in advance of a complete move – but a switch to digital only is inevitable.

I’d note that the news itself will most likely result in fewer people reading the print products as it puts migration to digital more top of mind.

The Fairfax moves are focused solely on their share price. They should not come as a surprise to anyone, especially not to newsagents. However, I think there will be newsagents who are shocked by the Fairfax moves.

Some state based newsagent associations have spent and continue to spend more time and effort on print distribution issues and plans than on retail yet the future of our channel depends more on retail. I wonder when they will realise their mistake.

While there is value in distribution newsagents consolidating in pursuit of efficiencies, there is even greater value in developing a newsagency model in a world where most newspapers in Australia are replaced by digital only platforms. We know from Fairfax and News that distribution costs are a key focus. There is no up side for newsagents from this focus. What little control newsagents had to drive their distribution businesses is fading. But this is not news.  If only channel leaders realised this and engaged with their constituency more proactively. They should have been spending more time representing the whole channel and not just distribution.

Fairfax is doing what it needs to do for its survival. Its needs do not match the needs of newsagents. Newsagents need to act on what is right for them. In my case, the decision to get out of distribution years ago feels more right every day.

Are newsagents focused on their future? Some are but not enough of them. Hopefully, today’s announcement from Fairfax will be a wake-up call for those with their heads in the sand.

While I feel for the 1,900 jobs Fairfax will shed, many more will be shed in newsagencies as digital replaces print for new consumption. This is a moment of fundamental restructuring which cannot be blamed on anyone. We have seen it coming for a while. Maybe some of those losing their jobs will not engage with more flexible and content driven online platforms.

News Limited is next up to the microphone with their announcement.

11 likes
newsagency of the future

Now you can like a comment here

A like button has been added to the comments facility here enabling readers to like a comment without having to make a comment themselves. To like a comment just click the button, you don’t need an email address or anything.

9 likes
Blogging

Be wary for card reps who say they can do better

I heard about a card rep who makes regular visits a newsagency that does not stock their cards. The rep is wearing the newsagent down with baseless criticisms about the cards in the business and the performance of the incumbent supplier.

This card rep is clever using comments and cheap shots to undermine what was, until the visits started, a healthy and successful relationship between the newsagent and the card supplier.

The visitor card rep was so successful that the newsagent started to doubt the rep for the incumbent card company. This led to some decisions which hurt sales, playing into the plans of the visitor rep to win the account.

If it were up to me the card rep would be told not to return. Some newsagents are too nice, they put up with and sometimes believe the salesperson’s shtick.

If you are being hunted by a card rep who wants your business tell them to win it with facts and not BS about their competitor. Tell them you want sales data, not sell-in data from the card company but sales data from newsagents from before and after they switched a newsagent over.

Anyone can say they can do better, few take the time to prove it.

No, I am not going to name the card rep or the newsagent. There is no point. I hope I have written enough to get newsagents to be wary of the BS.

2 likes
Greeting Cards

Display unit drives sales of That’s Life Puzzler on the go

The placement of the pocket displays unit holding That’s Life Puzzler on the go in front of That’s Life is working brilliantly. We will sell out in three weeks. Nice.

We were concerned that this unit might hurt sales of That’s Life.  It hasn’t. That said, we will not leave it here for the long term. We have taken care of the display unit and will use it elsewhere in the store.

1 likes
magazines

Selling the Tour de France program

Sales of the official guide to the 2012 Tour de France have been terrific from this counter display – so much so that we ordered extra stock over the weekend. We will sell out of our initial allocation by mid week.  We have the guide here at the counter as well as with our sports titles. It’s this counter location which is working a treat for us. There is no doubt that early sales are being helped by our own Cadel Evans being the current champion.

0 likes
magazines

My Weekly sells with newspapers

Our placement of My Weekly with the Queen’s jubilee cover story with newspapers has worked a treat with extra copies sold to people who would not look for this in the british magazine section. Often times tactical placement works bette than a great big display. That’s what has happened here. It’s nice when you get someone who came in for a newspaper purchasing something extra.

0 likes
magazines

Promoting Dolly magazine

We have been promoting the latest issue of Dolly magazine since it’s on-sale with this display at the entrance to the women’s magazine aisle. We also have a double half waterfall at eye level in the usual location for Dolly – half way down our women’s magazine aisle.

1 likes
magazines

Sunday Marketing Tip: How to develop your Unique Selling Proposition

In the last round of Newsagency of the Future workshops I urged newsagents to develop their Unique Selling Proposition as I saw (and see) this as vital to the future of any individual business.  I subsequently wrote an article published in the latest issue of National Newsagent magazine.

Here is the article. I urge newsagents and those who work in newsagencies to read this and develop a USP for their business:

Developing the Unique Selling Proposition (USP) for a newsagency is one of the most important steps you can take in business.

A good USP will frame every decision you make. It will also define why you are in business for it goes to the heart of your passion. It feeds from your mission, your reason for existing.

Yes, a USP must reflect passion for this is what drives your love of your business … and you do love your small retail business don’t you?!  This is where small retailers like newsagents are different to big retailers. Where they get lost in KPIs, share price and other metrics, small business retailers think in personal terms, often with emotion.

So how do you create your USP?  Here are some tips I have found useful when working with newsagents on developing a USP…

1. Take your time. You will be done when you are done. Getting your USP right is more important than meeting a deadline.

2. Think. Try and get time away from the business to think about your USP. A good location I have found works is siting on a seat across from the entrance to your retail business, watching your customers.

3. Love. Work out what you love about your business and / or what you want to love about your business. Next, think about what you want your customers to love so much that they will tell their friends.

4. Differentiate. Think about what’s special in your area or marketplace about your business.

5. What do you stand for? If someone says who are you? you will probably answer with the facts. If they say, no, I want more, what makes you special? you will probably, hopefully, take them inside what makes you tick. So, you need to know, what does your business stand for?

6. Define. Try and put into words your passion and what is special about your business.  Brainstorm ideas in ten words or less. Get as many down on paper as you can.

7. Would you be missed? It is said that people often define their view of themselves by wondering if they would be missed. Think about your small retail business in this way. Would you be missed? If so, how and why?

It might take a few goes, working through these ideas. The result should be something close to a USP for your business.

Your USP needs to be succinct, passionate and unique, something that explains why your business is different and why people should shop with you.

A big challenge for newsagents is the diversity of the typical business. A USP is unique yet so much of what newsagents sell is not unique. So, a USP may start with one part of the business, getting you known for that.

If you think you are close, test it with your employees and family. Test it with yourself too by asking what you would change in the business with this USP in place, what decisions would be different?

A good USP will guide business decisions and provide a framework through which you navigate change in the business. But most important of all, it defines why you are in business.

Change is inevitable. Yes, your USP can and will change as the business evolved.

So, get started. To help you along, here are three ideas that focus on passion and evoke emotion:

1. Gifts you’ll be proud to give

2. Cards people love

3. Where customers are friends

You can discuss your USP ideas with Mark Fletcher on 09418 32 1338 or at mark@towersystems.com.au.

3 likes
marketing tip

Page one newspaper story covered with stuck on ad

The Australian Financial Review weekend edition covered a page on news story with an ad for one of its magazines. It was the story about James Ashby and the allegation of a conspiracy to damage the reputation of the speaker, an important story.

Why do I keep posting about this? There are college students in the US and high school students in Australia who ask me about this as they study changes in newspapers. The appreciate the photos.

0 likes
newspaper masthead desecration
Trending Articles

Fairfax changes approach to TV Guide, disrespects newsagents

Published on April 20, 2011

What do you think of the Powerball changes?

Published on February 16, 2018

IPS releases new magazine contracts

Published on June 21, 2011