Australian Newsagency Blog

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

What Ovato could learn from greeting card companies

Mark Fletcher
May 4th, 2021 · 3 Comments

For many years I have urged management at Ovato, formerly Gordon and Gotch, to provide newsagents with the ability to control their own magazine supply. My argument was that giving newsagents control over range of titles and quantities received would see newsagents stock and sell more magazines.

The historic master / servant relationship with newsagents got in the way.

The leadership of Ovato did not like the idea and did not deliver this. They have maintained a system through which it is difficult for newsagents to manage their magazine title range and the quantity of inventory received. And, despite having access to accurate sales data, this appears to play only a moderate role in supply decisions within Ovato.

Magazine publishers should be frustrated buy this and here’s why …

For decades, newsagents could not easily choose the greeting cards they stock. The card companies had an antiquated and opaque process, that newsagents, for the most part, were happy to go along with.

Over the last two years, several major card companies have provided newsagents with complete control over ordering, including the ability to replace one design with another.

Looking at comprehensive pocket level before and after sales data, I am confident in saying that providing newsagents control over what card designs they stock is a key factor in above average growth in card sales. I am talking here about 20% and more year on year card revenue growth – even with the Covid period sliced out of the data.

The data study I have undertaken included businesses that did not change card suppliers – those that controlled what they stock grew revenue several times more than those that did not.

The message for magazine publishers is simple – if you want to grow magazine sales in the newsagency channel, give newsagents full control over what they stock. In my opinion, the failure of Ovato to enable this has held back magazine sales opportunities.

Are magazine publishers frustrated? probably not since they do not actively engage with newsagents. It’s one-way and sales of their titles suffer as a result.

Thankfully, some card companies have realised the commercial value to them from giving retail newsagents more control over what they stock. Kudos to them.

20 likes

Category: magazine distribution · magazines · Newsagency management · Newsagency opportunities · Ugh!

3 responses so far ↓

  • 1 Mark Fletcher // May 6, 2021 at 6:41 AM

    I am grateful to have heard from several small, indie, magazine publishers about this. It is helpful to share the newsagent magazine supply experience and for them to share their magazine publisher supply experience. I don’t know if it will result in change in a supply chain model, but I do know that mutually beneficial change only flows from mutual understanding.

    0 likes

  • 2 PJ // May 7, 2021 at 7:46 AM

    Aside from first delivery of a new title a business can control supply via the Ovato retailer website. Ovato now just need to give sufficient notice of new titles and the opportunity to adjust or cancel the supply like IPS do then it would be complete.

    0 likes

  • 3 Mark Fletcher // May 7, 2021 at 7:51 AM

    The website is shit, not conducing to helping retailers grow magazine sales.

    0 likes

Leave a Reply

Your email address will not be published. Required fields are marked *

Reload Image