The Herald Sun and the Daily Telegraph today have quarter page ads promoting the special issue of Woman’s Day as available from Coles supermarkets.
I doubt Coles paid for these ads.
My understanding is that Coles product advertising is funded by suppliers. I guess ACP paid for the ad. If true, shame on ACP for treating their retail channels differently and for ignoring newsagents, their most valuable retail channel.
I can see why Coles would have asked for funding – because ACP wanted them to do something beyond the usual with the weekly title. Whereas newsagents will invest their own time and space in these special issues, supermarkets only engage if they are compensated for what they consider to be extra work.
I’d love ACP to comment on this.
My recollection from when I worked at Coles Myer, as it was known then, is that most but not all advertising was supplier funded. It was not uncommon for the supplier funding to be greater than the cost of the advertising, meaning CML made a profit from the ad or catalogue.
Makes me angry.
Yet another reason we should be seeking greater remuneration from the magazine publishers/distributors who are currently taking advantage of us as a low cost retail channel. We really do need to start realising our worth where magazines are concerned or drop them to a second rate product line. This just goes to show how much money there really is available and what we’re missing out on.
Mark, out of interest, do you know what the breakdown of sales for WD is through the various retail channels ?
Like most products Coles sells, if the Supplier doesnt pay for the advertising or subsidise promotions Coles threaten to withdraw their product from the shelves. They have this power as it will happen across their shops nationwide. We do not have this power. It would be interesting to see how a Supplier would react if every newsagency in Australia all pulled a product from their shelves
Coca Cola stared Coles down 2 or 3 years ago over Coles draconian treatment of Suppliers by threatening to withdraw product. Unfortunately Coca Cola’s probably the only supplier big enough and powerful enough to do it, everyone else is left with little choice but to do Cole’s bidding on Cole’s terms.
Someone I know well placed in a competitor to Coles called me today and said they would only run an ad like this with supplier funding.
Coca Cola has sold what is supposed to be trade only through woolies and coles. I do not see that as staring down woolies or coles.
Peter, google Woolies v Coke and you will see that this actually did happen but it was with Woolies I think not Coles.
That is correct. Funding at a National level, and at a store level store, individual store management are given “gifts” for product placement.
For example, placement of a product on an isle end is a significant $$investment from the supplier. Product placement within an isle, i.e placing the product at eye level will see gifts such as bikes, entertainment tickets, packages to the footy or races….
Newsagents get Connections and Nexus!!
Aren’t they simply leveraging their scale…
The respective smkt buyers receive 100’s of these “over & above”proposals from suppliers and they simply plan and execute this activity across their whole business (National – Merchandise, Supplychain & Operations).
These events are very well planned (product location, allocation qty by store etc etc) & measured (scan sales Nat, state etc) to justify the space and time given by stores.
Suppliers will fund these events for any channel but will want/expect a level of support & commitment…what are we prepared to offer “over & above ” for it?
Our biggest challenge is…how do we leverage our scale? we have a greater number of outlets but unfortunately less traffic volume.
As an industry we have lots to offer suppliers and they us, we need to find a way for both of us to be able to work better together…if we want to!!
The thing is Mike we have a far greater scale – more sales, more outlets. But no one single office through which to wield discipline against ACP. I would have loved to seem them respect us more on this.