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

Author: Mark Fletcher

Crossword magazine sales up 24% year on year

magscwOur crossword sales are up 20% comparing the last eight weeks with the same eight weeks a year earlier. This is extraordinary growth outside what is average for the newsagency channel.

My research suggests that the average year on year growth for crosswords in 2.5%.

I’d put our growth down to moving the category to a better vertically integrated fixture and our discount voucher loyalty program. The discount voucher basket data in fact shows extraordinary use of the vouchers for crossword titles.

Newsagents can grow crossword magazine sales through more proactive shop floor engagement and a genuinely rewarding loyalty program.

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crosswords

Extra early returns for Christmas

xtrareturnsI broke with tradition and did an additional sweep for early magazine returns yesterday, Thursday, because of space pressures as a result of unwarranted additional magazine supply and Christmas space pressures.

Outside of our usual magazine returns and a reasonable first pass at early returns, this  photo shows the additional early returns I pulled out of a desire to exert more control over my business yesterday.

The planned MPA magazine publisher  distributor code of conduct will not adequately address the oversupply situation nor will it address the uncompetitive nature of how magazines are supplied to newsagents versus our competitors. Until this is fixed, early returns are the only tool newsagents can use.

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magazine distribution

Making a splash for Dolly

dolly5I found room yesterday to display all five covers of Dolly for the next week at least. The covers look terrific placed next to each other.

We’re fortunate to have fixtures that make eye level full cover display achievable in the magazine department.

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magazines

How to grow Diabetic Living sales

dbtlI’ve found the best way to grow Diabetic Living sales is to place it with health titles plus weeklies and or food titles. It’s a magazine often purchased on impulse – hence the importance of location. This week we have it with That’s Life as it always does well from there.

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magazines

Promoting Frankie for impulse purchases

frankieWe are promoting the latest Frankie magazine with a half waterfall as well as an off location placement with a range of stationery we have for the Frankie shopper.

Having the full cover of Frankie on show to drives impulse purchases.

This bumper issue of Frankie looks stunning.

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magazines

Here’s how PayPal payments work in a newsagency

I was asked here a while back to show how PayPal payments work in a newsagency. This video shows the process – how a PayPal customer can pay thanks to newsagency software integration.

The real value of PayPal is that PayPal shoppers can find your business. This integration is as much about newsagency marketing as it is about streamlining shopper payments.

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Newsagency management

WH Smith impact on Australian suppliers and newsagents

As WH Smith extends its reach here in Australia, acquiring more retail locations through acquisition, some suppliers will see business impacted. New commercial partners will benefit while those who are not will not benefit.

I’ve heard of a supplier relationship that advantages one supplier over a competitor in an important specific channel. The supplier who missed out stands to lose significant revenue as a result.

A bigger group making decisions like this can have an impact on supplier businesses. The flow-on effect could be beyond direct WH Smith relationships.

This is another aspect to consider of the changes we are seeing in our channel here in Australia this year.

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Newsagency challenges

Magazine publishers need to be careful who they listen to

At a recent publishing event someone claiming to know was putting it about that newsagents were achieving a sell through rate of 50% for magazines.

The person reportedly saying this does not have access to data to backup the claim. I think it is their best guess. But they did not qualify it.

I see real sell through data for many newsagencies. While there are some with an overall sell through above 50%, there are many below. But this high level measure is unhelpful. The best measure is non weekly sell through as this is where newsagents are hurt the most.

Once I take out high volume weekly titles, the average magazine sell through I see for newsagents is close to 40%. That is, 60% of this stock fails to sell and is either recycled through the system at the newsagent’s expense or thrown out and wasted.

The MPA driven magazine code of conduct that is at the basis of a supply model trial with selected newsagents will not address this as the code does not go far enough. Replacing a failing title with another failing title allows a distributor to pass the code but fail the newsagent.

I want magazines I can sell. I’m happy for a 75% sell through – less than that does not work for me or the publishers I serve. The problem is that 75% does not work for the magazine distributors. hence the uncompetitive supply model forced on newsagents.

Yes, I hear you …  blah blah blah – nothing new here. That’s true. But I feel better for writing it.

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magazine distribution

Gordon & Gotch magazine fail #3

image[5] copyYep, the same newsagency as the last two, this time it’s TAN UNRESTRICTED. With no sales achieved from issue 54 through to issue 64, the Gotch magazine allocations experts have decided the newsagent needs to go from five copies to eight copies. This would be laughable if it was not so harmful to the business.

And you wonder why newsagents are getting out of magazines.

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magazine distribution

Cool Dolly cover series

dolly5Kudos to the folks at Dolly for their five different covers on the One Direction members. It’s a brave move. We have done what we can to show off the five covers but can’t devote enough full face pockets to have all on show at once. One Direction is not driving sales as it used to – calendar sales are the best indicator of that for me as I have good data.  Calendar sales laid out against first week’s sales of their latest album compared to their previous three shows that while the band remains popular, that popularity is not translating into the sales they used it.

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magazines

Are discussions under way on the next WH Smith acquisition?

I have heard from three suppliers in the last 24 hours that UK retail group WH Smith is in negotiation with an Australian newsagency group to acquire franchisor management control of that network and add it to its rapidly growing portfolio. We know from recent acquisitions that WH Smith prefer the franchise model over corporate stores.

If the reports lead to an acquisition, it will shake up the channel and considerably challenge several key newsagent suppliers.

I don’t have confirmation from the group so I will not name them here.

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Competition

Collectors are valuable newsagency shoppers

bbbearCollectors are a valuable customers – the challenges are discovering what they collect and understanding them. This was brought home to me last week when I delved into the world of the Breaking Bad collector, the world of someone who will purchase items related to the show and the knowledge they have about what they collect.

Take this pink teddy from Breaking Bad. It’s a sad looking thing but it is sought after by Breaking Bad fans. If you had it in your plush department people would think it’s damaged stock. If you put it on a pedestal under a spotlight, Breaking Bad fans would recognise it. Many would have read the history of the bear online, they would know that it is more than a bit player in the Breaking Bad TV series.

Thanks to the support from several specialist suppliers, engaged newsagents have access to products like the pink teddy bear that cater to TV show fans, band fans and collectors of other items.

I know through my involvement with the collector strategy of the newsXpress newsagency marketing that there is also considerable support to help newsagents to get into and make money from the collector space.

With a serious collector spending between $1,500 and $3,000 a year on their collection (of any sort), being able to serve them depends on product knowledge, good supply and smart shop floor engagement.

This is that the pink teddy bear represents – a lesson in the value of collectors and the role they can play in some newsagencies in unlocking new traffic for the business.

It’s hard work serving collectors. You need to step into their world of obsession. You need to understand their interests. You need to respect them. You need to enjoy their excitement at new products they can add to their collection. So, yes, it is hard work … and very rewarding personally and business wise.

This is what selling to collectors is about, knowing

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Newsagency management

Amazing Lego Christmas display

legoxmasOn Pitt Street Mall in Sydney is an amazing Lego Christmas display, standing tall and drawing families tas it lights up and Christmas music plays.

This is an inspiring pitch for the Lego brand. I saw kids loving the music and lights and adults in awe of the construction using Lego bricks.

The display reinforces the strength of the Lego brand and the value of a big display in attracting people.

Click on the image to see the bricks.

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visual merchandising

Advent calendar overload

adventoverloadFor years advent calendars were challenging to find. Today, we are swamped. In one shopping centre this week I saw them in supermarkets, discount variety stores, confectionery shops, newsagents, gift shops and even at the fruit shop.They all had boxes of them – many featuring licenced brands … and most were discounted. What was once a specialist retail line you could enjoy a good margin from is now another oversupplied line you will be lucky to break even on.

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Newsagency management

Excellent branding and placement leverages traffic

ksThis Kinder Surprise display at the front of the Woolworths supermarket on George Street in Sydney is terrific. There is no missing the Kinder Surprise branding as you enter of leave the store through the main entrance. Kinder Surprise owns the space. From the detail on the floor units to the large posters, this is a consistent and clear message.

While I expect there supplier would have paid for the space and had professional merchandisers create the display, the photo offers us inspiration for our local newsagencies, inspiration to give over key traffic space to a single brand that will interest our shoppers.

While many newsagents do excellent displays, they are often done on a small scale and end up fighting for attention in a visually busy shop. The approach in the photo shows the value of giving space reserved for multiple displays over to a single brand.

Click on the image for a larger version.

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retail

A reminder that colour blocking works

zumbo-macaroonsNowhere is the value of colour blocking more obvious than in the display at Adriano Zumbo’s kiosk at the QBV centre in the heart of Sydney. You can see people notice the colours of the display. It’s effective because of the colours they place next to each other. The same product arranged differently, may draw fewer people … it all comes down to effective colour blocking. Getting this right can draw people to anything. For good advice on colour blocking check out the advice from Apex display.

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Management tip

Dumping bagged discount magazines

wwbauerThis photo shows how the bagged discount magazine pack of Woman’s Day, OK! and NW from Bauer is being treated at a Woolworths supermarket – away from weekly titles, display unit for AWW. And on that, note the header provided by Bauer for AWW for the display. I’d have said yes to a floor display unit to promote the Christmas issue of AWW if I was offered one. The difference in support for supermarkets which sell fewer magazines than the newsagency channel is disappointing.

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magazines

How to cut theft in your newsagency

I did this video – How to cut theft in your retail business – for my software for my software company a few weeks ago. It contains non system specific advice on how to cut theft.

I am sharing it here this morning because in the last week I have heard from four newsagents who have discovered serious employee theft problems.

The advice is simple and will work =for any newsagent regardless of the technology you use. Unfortunately, newsagents tend to act only after theft has occurred.

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Newsagency management

News Corp’s Courier Mail recasts the WH Smith story

Someone must have complained to the folks at News Corp about their poor coverage of the WH Smith Supanews takeover story. As I noted when I wrote about this…..

The ‘corrective’ story they published at the weekend still has problems. First up, News Copr. Needs to stop referreing to our businesses as paper shops. We’re ot paper shops.

The Courier Mail report sought comment form the ANF:

Alf Maccioni, chief executive of the Australian Newsagents Federation, agreed the traditional corner store newsagent would survive the arrival of WHSmith.

Mr Maccioni said WHSmith was only likely to open new outlets in major shopping centres, where the rents were prohibitive for independent operators anyway.

I am not sure why the ANF would say this or if the Courier Mail has misreported. WH Smith in the UK is in malls and on thehigh street. As readers here would know, they have recently launched a new franchise model for independent newsagents that is gaining considerable traction in the UK. It’s called WH Smith Local. I looked at it when in the UK a few weeks ago. I’d expect WH Smith in Australia to leverage all of their platforms from the UK.

The growing presence of WH Smith in Australia is a wake up call our channel needed. The question is whether newsagents have the strategy to deal with this.

In addition to disruption to print, migration of lottery products online and the drop in commission on agency lines, newsagents are also challenged by misrepresentation of our businesses, what we are capable of and the services we provide.

For a channel so connected to the media it is disappointing that reporting too often misrepresents us.

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Newsagency challenges

Another significant departure at Seven West

Also as part of the restructure at Seven West, Nick Chan, Chief Financial Officer at Seven is leaving the company. Nick was CEO of Pacific Magazines for many years where we oversaw the development of a strong portfolio of titles.

As CEO, Nick was a champion of newsagents, committing considerable resources to help our channel compete in a more diverse marketplace.

I was fortunate to meet Nick several times and while many newsagents would not know him, he was important to our channel.

Publishing experience is important in the magazine business and each time any publisher loses someone with good publishing experience, like Vicki Rossi and Nick Chan, the businesses loses valuable experience.

Indeed specialist business experience is important in any business. You only have to look at the damage in some publishing businesses when they replace category experts with FMCG people.

I’m sorry to see Nick go and whish him all the best for the future.

Newsagents need to look at the moves at Seven West and consider their own businesses. We are in an economy where efficiency is vital. Doing more with less is the rule of the day. Even though we do not have the obligation of publicly traded shares that Seven West has, our focus on operating costs ought to be as focussed.

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Newsagency management

It’s Taylor Swift season for magazines

magstswiftWe take note of who is on the cover of magazines and place titles together that feature the same person. This is why it’s Taylor Swift season in our fashion section and why we have Cleo and InStyle together and why we have them placed so that those who do not usually purchase these titles can see the cover. It’s all about driving impulse purchases – that’s how a good cover works for us.

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magazines

How newsagents treat the Bauer discount packs

bauerdiscountHere’s how one newsagent has placed the latest discount magazine pack from Bauer – the Woman’s Day fronted pack is mixed in with fashion titles.

We early returned ours as usual – we don;t want these discount packs as we don;t have the spare pocket and we don’t agree with the discount strategy.

I can’t see how this works for Bauer in newsagencies.

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magazines

Even the Financial System Inquiry report wants magazine supply to be data driven

Check out this excerpt from Chapter 3 Innovation of the Murray report – the final report of the Financial System Inquiry:

The Inquiry’s recommendations to facilitate innovation aim to:

  • Encourage industry and government to work together to identify innovation opportunities and emerging network benefits where government may need to facilitate industry coordination and action.
  • Strengthen Australia’s digital identity framework through the development of a national strategy for a federated-style model of trusted digital identities.
  • Remove unnecessary regulatory impediments to innovation, particularly in the payments system and in fundraising for small businesses.
  • Enable the development of data-driven business models through holding a Productivity Commission Inquiry into the costs and benefits of increasing access to and improving the use of private and public sector data.

These recommendations will contribute to developing a dynamic, competitive, growth-oriented and forward-looking financial system for Australia.

In our channel we have accurate data flowing between supplier and retailer, data that can drive efficiency for all stakeholders. Yet it is not used for to do so would reduce the income from one stakeholder.

While there is mucking around going on with magazines at the moment because of the code of conduct moves, it does not go as far as the world envisaged by Murray and others who worked on the Inquiry.

The current approach to using newsagent magazine sale and return data impedes our channel, it makes us less competitive. Murray would not be impressed.

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Uncategorized
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