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

Author: Mark Fletcher

Murray report could bring on help in card transaction fees

If adopted, recommendations of the Murray report could help newsagents and other small businesses when it comes to handling fees associatied with customer use of cards for payment.

Recommendations to reform the payments system would benefit SMEs (see Recommendation 17: Interchange fees and customer surcharging and Recommendation 16: Clearer graduated payments regulation in Chapter 3). The Inquiry’s proposals to lower interchange fee caps would reduce the fees paid by all businesses and reduce the difference in fees paid by small and large businesses.

What actually happens will depend on governments and banks.

See more small business coverage in the report here.

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Newsagency management

Australian newsagent discount voucher success reported in the UK

Screen Shot 2014-12-07 at 12.25.10 pmBetter Retailing has published a terrific report on our success with discount vouchers. I met with Steve Denham, a former UK newsagent and regular commenter here, who wrote the article when in the UK six weeks ago. We had a good talk about discount vouchers and their impact on sales.

A year and eleven months in with discount vouchers and having used a points based program as well as buy X and get Y program, I rate discount vouchers as the most successful loyalty program I’ve seen.  It’s whole of business and that is key. It is more easily understood than the old points based program plus it has no hoops that make customers groan.

Better Retailing is a highly recommended read for Aussie newsagents – it publishes plenty of ideas from which we can learn.

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Newsagency management

When we lose good people from our newsagency channel

Vicki Rossi finished up with Pacific Magazines a couple of weeks ago as part of a restructure within the business that saw several senior people and others leave the company

As Retail Sales and Circulation Director, Vicki was the executive at Pacific most responsible for the newsagency channel. In this role, Vicki served us the company well, ensuring that newsagents were a key part of Pacific circulation strategies. Sure there was progress with supermarkets, but there was progress with newsagents too.

Vicki and those who reported to her were responsible for the nexus program, the best supplier support program for newsagents in the history of our channel. Yes, it is better than Connections because it offers practical business growth tools newsagents can use like email and SMS campaigns, it offers rewards based on real sales growth, it offers us access to comparative performance data by title and marketed us personally to people in our postcode area. Vicki was a key driver for nexus.

I have seen sales data that demonstrates the value of nexus to newsagents. Those who use the tools of the free nexus programs out perform newsagents who do not.

We have Vicki and the team she led for years for this opportunity.

I am sorry to see her leave but I understand that pacifies and parent Seven West needed to address poor numbers and cutting costs is one way for them to do this to appease shareholders.

I am grateful to Vick for her active support of newsagents publicly and privately. pacific magazines will miss her.

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magazines

On The Run magazine offer challenges newsagents

otrmagzFurther to my post Saturday about the low cost Tatts fit out at the On The Run convenience stores in South Australia, check out the magazine department in this same outlet.

This is competition folks, serious competition.

Convenience outlets usually focus on a small range of no more than thirty titles, top sellers. This location and others like it from this group have a far bigger magazine over, one that competes on range with local retail newsagencies.

Newsagents with businesses competing with On The Run locations need a comprehensive strategy for effective competition – this is a chain out for your everyday business given not only their magazine range but their lottery products, greeting cards as well as stationery.

I’m not writing this to scare you. I am writing this to better inform newsagents that convenience is the channel targeting us even more so than supermarkets. Each of us needs to reflect this in our own business planning if we are chasing the same convenience shopper.

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Competition

Love for The Melting Snowman as strong as ever

msbowThis is our third year with The Melting Snowman and sales are as strong as ever. We thought it might slow and so placed it among all Christmas products and not under the spotlight at the counter as for the last two years. It’s sold from the regular Christmas table. It’s purchased as a gift for a co-worker, for Kris Kringles and even for home for fun with the kids.

The rapid stock turn makes The Melting Snowman a top performer this Christmas again on the return on shelf space and return on inventory investment measure stakes.

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Gifts

Frozen working at the newsagency counter

frozencounterThis counter placement of Frozen product is a small part of our overall Frozen pitch. We chose these products as they are easily purchased on impulse – including the $15.00 vinyl collectible characters. While there is Frozen overload in retail, having different products is important as is ease of purchase – hence the counter offer.

Stocking stuffers are especially popular as impulse purchases at the counter. We think very carefully about what we place here and we change it regularly through the week.

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Gifts

Who magazine shines with Hughes coverage

whohughesThe Who cover story on the passing of Phillip Hughes was timely and respectful. It’s one of their best issues of the year, showing how a magazine can stand apart with coverage of a major local news story. Well done to everyone involved. We embraced the opportunity with full cover placement with weeklies and with newspapers.

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Uncategorized

Disappointing newspaper cover-up

newspapercoverupOn the front page of the Sunday Herald Sun today News Corp left the its spin piece from the Prime Minister’s office un touched while it covered up part of the heartbreaking story about a child hit by a fork lift. This house ad for cheap home delivery of the newspaper disrespects the news and the retail newsagents who rely on over the counter sales.

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newspaper masthead desecration

Sunday newsagent management tip: let them play and enjoy a sales boost

sandplayingOur team members are encouraged to regularly play with the kinetic sand we have on display. The photo shows a display from Wednesday.

We have found that the better the display the more it is noticed and the more it is noticed the more people play with the sand and the more they play with the sand the more we sell.

Playing = sales!

Our job as business owners and managers is to encourage our people to do things they like that help the business. They enjoy their work more and we reap rewards from this.

While kinetic sand is in many more retailers today than when we started with it a year ago, our sales remain strong in part because of displays like this. the majors don’t pay this level of management attention to a product that demands interaction on the shop floor. the majors would prefer the supplier to send someone in to create the displays. Haha.

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Management tip

Sunday newsagency marketing tip: create a local photo op

tourismtrafficI saw this photo opportunity at Hung Hom Station in Kowloon last week and thought it’s something that could work for some newsagents.

If you are in a country town in which people stop off as they pass through, why not create a display in your window or in front of your shop and have a couple of holes for people to stick their heads in for photos.

Make it fun, and local – leverage a local connection. Include the name of the town – and your business somehow. If your town is known for an industry, a crop or a particular natural wonder, use this as it’s a local feature people are more likely to want to be photographed with.

If you don’t have an appropriate local connection, consider having life size art of royalty or movie stars in a pose holding a sign – with my friends at XXX newsagency.  In other words, if you can’t think of a local feature, make one!

faceHere’s one of several characters at Adelaide airport right now as part of their Christmas promotion. Whiel I was there plenty of kids wanted their photos takes with their face in the gingerbread character. This is another example of how you could engage with this marketing opportunity.

Ask a local school or craft group to make the display – extend the local connection and drive more traffic. It’s a terrific way to show off local talent.

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marketing

Low cost Tatts fit at On The Run in South Australia

otrlott1Here’s the Tatts (SA Lotteries)  fit at an On The Run outlet in Adelaide. On The Run is a statewide convenience operator selling fuel, food, toys, cards, some gifts, magazines and Tatts products. This is a small footprint counter deep in the store, on the back wall.

I’d heard about the small footprint approach they had approval for and wanted to see it for myself. It looks good – certainly noticeable from inside the 250 sq m shop.

otr2Here is the signage you see as you enter the shop from the fuel area. Again, professional, a clear message.

I like the connection between this sign and what is at the counter.

Maybe is Tatts concentrated on facilitating consistency in messaging newsagencies rather than forcing shop fits that are bigger than they should be and bigger than is financially justifiable newsagents could grow sales.

The different rules demonstrated for representing Tatts products in newsagencies versus bigger groups like On The Run is concerning and needs attention.

If I was involved in representing newsagents I’d be collecting photos like these and collating information about the diversity in standards. I suspect there would be evidence supporting a case for fairer treatment of newsagents and for reducing their capital investment in regulation shop fits.

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Lotteries

The emerging new channel for bonbons

bonbnsYears ago newsagents used to be the place people would shop for Christmas bonbons and over time that changed as supermarkets and mass retailers embraced the category. Some of us are winning back customers with bon bond at the everyday through to high end.

While sales of bonbons were slow at the start point the Christmas season they have kicked into gear now.

This is another product category through which we can attract shoppers at Christmas time. There are several good suppliers already serving our channel who have good bonbons from which to choose.

We can compete on range, price and service. Supermarkets and mass tend to have poor quality product at high price.

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marketing

A very different office supplies range

officesuppliesCheck out the office supplies wall I saw while looking at retail in China earlier this week. It’s unlike any office supplies wall you’d see in just about any retail shop inAustralia, except Typo. Impressive. Inspirational.

The shop was busy.

Years ago, newsagents would have called this more of a social stationery range. Today, it’s a volume business for several key demographics we struggle to serve.

While I am not going into detail here on how to create this offer here in Australia, the purpose of this post is to call out to newsagents with another example of how everyday stationery focus is shifting.

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Stationery

Inspiring hamper display

giftbasketsI was impressed with this hamper display I saw in Hong Kong last Sunday and share it here as inspiration for newsagents who are offering hampers or gift baskets as a service.

The display in the photo is used for harvesting orders for deliveries. I know of newsagencies in Australia where hampers are offered off the shelf.  It’s a niche offering that can work well in our channel during major seasons. They can open you to new customers and provide you something to pitch o local businesses.

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Newsagency opportunities

Magazines in small footprint retail in Hong Kong

magoverlapSee how a small footprint (25 sq m) convenience store at Hung Hom station in Kowloon displays magazines. This fanned out approach is what newsagents in Australia used to do decades ago before moving to full face in the 1980s.

With rent and labour increasing annually and magazine revenue flat or declining for many, newsagents need to cut overheads associated with magazines. One way to do this is to reduce floor space. The fanned magazine display approach lets us do this without reducing range as much as otherwise might be the case.

Note the lower shelves where more space is dedicated to these titles.

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magazines

Is a newsagency a good business to own?

Here is a brief video I did last week to answer this question I am asked daily by potential newsagency business purchasers and others interested in our channel – Is a newsagency a good business to own?

I decided to do the video because of the negative press around the tatts and some other issues playing out at the moment. Let me know what you think.

What we achieve with our newsagencies is up to us. The more we rely on others like suppliers the weaker our future. The more we rely on our own ideas, energy and networking with like-minded newsagents the brighter our future.

I could have talked for longer and have done on other videos I have published here and elsewhere. This time, I wanted a brief and clear statement about why I think a newsagency is a good business to own.

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Newsagency management

Take a look at how one Coles supermarket presents greeting cards three days in a row

I visited my local Coles supermarket on Tuesday, Wednesday and Thursday this week to see how they presented cards, to see if the display was cared for through the week.

c1Here is how I found the cards by my local Coles supermarket on Tuesday this week at around 5:30pm. The display was messy and uninviting. I figured it was the end of the day and that the cards would be tidied overnight or in the morning. I was wrong.

c2Things had not changed when I visited at around the same time Wednesday. Some card placements had not altered at all indicating that there had been no tidy up or refresh of the card offer. Is this not a daily task? They refresh dairy, why not cards?

c3Last night, Thursday, this is what I saw when there at 5:45pm. Some cards out of place as they had been for three days at least. Is no one responsible for cards here? The display remains uninviting. This is the untidiest part of the supermarket.

We can compete with Coles, Woolworths and other supermarkets in the card space by managing our card displays, tidying them daily, ensuring the offer is neat and fresh and offering shop floor service to our customers. We can pull people from supermarket shopping for cards through loyalty offers and engaging with shoppers.

Our competition starts with professional displays as this is where many supermarkets fail. If I had a newsagency near my local Coles I am sure I could hurt their card sales given their treatment of the product.

Supermarkets have cards because of their extraordinary traffic and not because they respect the category. We have cards because we offer a superior experience. The more engaged with the card department in our shops the more money we will make.

I am writing about this today to encourage newsagents to compete through their card offer. The better you manage cards the more you will sell. It’s probably the most financially rewarding department you have in your newsagency in gross profit percentage terms.

There is only one reason for newsagents to engage more effectively with their card department – because it is financially worth it. There is no better motivator for engagement and compliance than profit.

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Greeting Cards

Ideal gift with purchase from Your Garden

gwpmagsThe latest issue of Your Garden magazine comes with a perfect gift with this title: seeds with a Jiffy planting pod. With the low frequency of Your Garden we find we have to chase customers – hence our placement with newspapers, weekly magazines as well as with garden magazines for the first couple of weeks of the on-sale. The extra locations work.

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magazines

A challenging gift with magazine purchase

gwpAustralia is not the only place where magazine publishers challenge retailers with gifts with purchase. The photo shows a plastic bottle with a drink of some sort bagged with what looks like a food title – in a Hong Kong convenience store. There is no easy way to display it.

Magazine publishers tell me that gifts work. I’d believe this for the gifts we see repeated as there is no point in them repeating something that is not working.  I am not sure sure about bags with fashion titles though – I think customers are over those – and scarves and cheap jewellery we often see with teen magazines.

The best gift I have seen in-store this year is the Christmas tin with Better Homes and Gardens. It helped us achieve a sell out.

I am all for gifts as long as we can display them professionally with the accompanying magazine and as long as they deliver better than average sales.

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magazines

Coverage of WH Smith acquisition of Supanews

The Courier Mail has covered the purchase of the Spanews newsagency group by WH Smith.

BRITISH high street newsagent WHSmith has acquired the Supanews chain in Queensland, a deal set to provide tougher competition for the traditional family-owned paper shop.

Privately-owned Supanews, founded by veteran newsagent Adrian Gaskin in 1992, has 29 stores in Queensland, the ACT, New South Wales and Victoria with an annual turnover of $80 million.

The investment in Supanews by the UK retail giant could transform an industry suffering from stiff competition from convenience stores and supermarkets selling lottery products and magazines.

I am over how newsagencies are represented in reports like this. We sound like tiny struggling micro businesses. While some are, there are plenty that are small for sure but strong and healthy and enjoying change.

Newspaper reports should focus on how core parts of newsagency businesses are being constrained by rules imposed by commercial suppliers in some products categories, rules that make us less competitive.

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Newsagency challenges

How the Rolling Stones helped us with a Beatles sale

beatlesA customer a couple of days ago purchased a Rolling Stones calendar after much deliberation – they didn’t want to pay the price we had it at.

Our team member encouraged the purchase commenting that they’d get a discount voucher. It worked.

Once they got their voucher they surprised us by then purchasing a Beatles mug without a second thought – using the discount voucher for some $$ off. This is happening regularly – people worry about how much they will spend on an item and then use the voucher they receive to make a less considered purchase.

Our year on year sales were up 14% in November and I’d put the majority of that down to discount voucher engagement by our team and our customers.

We have learned that discount vouchers fundamentally change shopper engagement. Concerns disappear as do price perceptions about the business. We are known for the vouchers, they are generating net new traffic for us. Plus they make visits, like that of the Rolling Stones fan, more valuable as they extend their basket.

With many shops in our 300+ store centre having access to most of what we stock, the discount vouchers are a point of difference. Our sales results demonstrate that they are a bankable point of difference.

But back to the Rolling Stokes shopper. I’m wondering why they worried about price for the Stones item but not for the Beatles item. Then there is they question of why one customer would purchase both items because back in the day you were either a Stones fan or a Beatles fan. These are questions for another day.

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Gifts

Licenced products that ought to be on newsagents’ radar

License magazine has published the top toy licences for boys and girls for 2014. It’s a shopping list for newsagents who want to be strong in this space.

2014 Top Toys for Boys

  1. LEGO
  2. Cars and trucks
  3. Teenage Mutant Ninja Turtles
  4. Video games
  5. Hot Wheels
  6. Xbox One
  7. PlayStation4
  8. Transformers
  9. Remote-controlled vehicles
  10. (Tie) Marvel action figures–Tablet/Apple iPad

2014 Top Toys for Girls

  1. Disney Frozen
  2. Barbie
  3. Dolls (generic)
  4. Monster High dolls
  5. American Girl
  6. LEGO
  7. Tablet/Apple iPad
  8. My Little Pony
  9. Disney Doc McStuffins
  10. Apparel

While independent newsagents will struggle to get into some licences because of how suppliers operate, the list provides an excellent goal shopping list when planning for 2015. Sure, there are some entries that do not play in Australia – but overall the list is very useful not only in the toy category but elsewhere in the business.

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Newsagency opportunities

A reminder we are not our customers

notourcustomersAlmost daily there is a reminder that we are not our customers and we should not assume we know what our customers will like. One of our team members thought these Be Jolly wind ups would not sell. In a week, almost all are gone. I like it when this happens as each occasion is another lesson learned.

The more we experiment outside what we usually do the more we stand to learn.

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retail
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