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

Author: Mark Fletcher

Newsagents embarrassed and hurt by Partworks supply failure

One of the most common magazine supply complaints I hear from newsagents relates to partworks supply and the difficulty in getting backorders to help partworks collectors complete their collection.  Here is an email I received from a colleague newsagent that outlines a current concern:

I have had a few issues with missing parts for partworks recently and feel that all the responsibility falls onto the newsagent.

When an item is back ordered and it takes time to arrive they go outside of their return dates and become firm sale.

So we have to take it on firm sale because the distributor/supplier did not have enough parts, and in doing the right thing for the customer we have to take the risk.

I have a current instance where I have a back order for number 68 of the James Bond DB5 model.  The customer has spend in excess of $1300 and has been waiting more than 10 weeks for a part.

They are now hesitant to pick up parts as they feel it may not arrive (and NDC does not impart a great deal of confidence that it will).

This has also happened with other partworks, and customers drop off because parts have to be back ordered, so we do the legwork early and then due to short deliveries we miss out on the sales further down the track.

Anyway, this one case has been a bone of contention (and to make it that little bit harder this particular customer is profoundly deaf so all communications is on a sheet of paper!).  Thought it might make a good blog post.

The issue outlined here is often experienced by newsagents. Magazine distributors and partworks publishers need to find a better solution for newsagents and partworks collectors.

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partworks

Grabbing impulse diary purchases

We have placed the beautiful LIFE IS A GARDEN 2013 DIARY between our two daily newspapers. This is in addition to with our diaries and garden magazines.

This is a wonderful diary, a perfect gift for a gardener. I went for placement with newspapers as this will get the diary seen by more shoppers and now is the time diaries like this sell.

Universal magazines are to be congratulated for giving us a quality product at good margin and with control over supply.

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Diaries

Timely Take 5 promotion

The lottery ticket promotion with the current issue of Take 5 magazine is timely with lottery jackpots in the news even in newsagencies where lottery tickets are not sold. We are promoting the opportunity in several locations including in the home location for the title. This is the type of promotion no other retail channel gets behind unless the publisher pays them to.

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magazines

Woolworths using Halloween for marketing

Woolworths sent out an email to customers yesterday using Halloween to promote candy and alcohol. I mention this as it’s an example of the reach of the season for marketing beyond halloween products like spider webs, masks and make-up.

Retailers in the US use the season to boost sales with terrific success.

We are contemplating a Halloween one-day sale on October 31.

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marketing

Newsagency businesses perform well in latest sales benchmark study

I’ve completed the analysis of the latest newsagency sales benchmark data covering the July – September quarter compared to the same period last year.  The pool of data was from 123 newsagency businesses around Australia and covering a good selection of circumstance.

Here are the newsagency sales benchmark highlights:

Trading remained steady for newsagents in the July – September quarter of 2012 compared to the same period in 2011. Year on year results almost mirrored those of the previous quarter. This is good news.

  1. Traffic. Customer traffic was up slightly with 61% recording an average increase of 2.1% of transactions.
  2. Basket depth. 43% recorded an increase in the number of items in a transaction and the average increase was 4%.
  3. City versus country. City based newsagencies delivered the better results.
  4. City vs. country. Regional & rural newsagencies are the best performers.

Now for the results by key departments:

  1. Magazines. 44% of newsagents in the study reported unit sales growth with an average growth of 3.5%.  Of the newsagents reporting a decline, the average decline was 5%.  60% reported a sales decline for women’s weeklies – average 6%.
  2. Greeting cards. 69% of newsagents reported an average 3% revenue growth.
  3. Stationery. 49% of newsagents reported an average growth of 5%.
  4. Ink. 55% of stores participating in the study separate ink sales data allowing further analysis.  67% of stores reported ink an average of 5% growth.
  5. Gifts. 61% reported an average of 6% growth.
  6. Newspapers. 61% of newsagents reported a decline of 3% in newspaper sales.
  7. Tobacco. Sales declined. 65% of store with the product reported 11% decline.
  8. Confectionery. 54% of store reported an average decline of 3%.

That said, there is no doubt that shopping centre newsagencies remain vulnerable.  This speaks to the fickle nature of shopping centre traffic performance.  While am no economist it could be that they are the first to experience trends.

Newsagencies continue to be good businesses to own. They respond to attention.  Retail is not as tough as some keep saying.

For what it’s worth, the best type of newsagency to own today is one where you have the most control over what you sell. This can be in a shopping centre but is more likely to be in a high street and / or regional situation.  Ideally, it would be a business where you can ultimately own the building.

We create our own luck, now more than ever.

I appreciate the time given by the newsagents using the Tower Systems newsagency software who shared the sales data that is the basis for this study.

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Newsagency benchmark

Oversupply of Grazia

We usually sell two or three copies of Grazia from ACP Magazines. We actively support each issue of Grazia with co-location in high traffic locations without success. Somehow, ACP or their allocations system has decided we need to go to eleven copies. I can’t see anything in this issue of Grazia or in our sales history to justify the supply increase.

While it may be put down as an error by the publisher, the reality is it’s an error the newsagent has to endure and it happens all too often.

This is the type of oversupply newsagents complain about. It is the type of oversupply that causes newsagents to strike out when early returning titles out of anger.

Magazine distributors demand and bully newsagents to pay their accounts on time. They hold us responsible. Yet they do not give us reasonable levers with which to control our level of indebtedness. This is unfair. It has been unfair for decades.

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magazine distribution

Promoting the Better Homes and Gardens Christmas cookbook

We are promoting the Better Homes and Gardens Christmas cookbook with this prime position display facing shoppers as they enter the store and head to the magazine department.

I am thrilled with the margin (book margin as opposed to magazine margin) and I am thrilled that I got to order what I wanted. These are two things newsagents have talked a lot about here in comments on this blog over the last week. Here is a publisher giving us what we want. I wonder how many newsagents embraced the opportunity from Pacific Magazines.

We have high hopes for the title. It’s beautifully produced and keenly priced. If it’s like last year’s title it will sell very well for us.

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magazines

Back to School survey results

50.8% of those responding to the Back to School engagement survey over the last three days indicated that Back to School is not an important season in their newsagency.

24% of respondents said that their Back to School commitment is increasing for 2013, 33.1% say there will be less commitment and 43.0% say their commitment will remain unchanged.

While the 122 survey responses represent a small sample size, I think the results do represent the sentiment of the channel more broadly. I say this based on discussion of this topic with many newsagents right around the country.

While Back to School is an important season, more newsagents are opting out having, I think, become disillusioned with the season.

With more schools and school groups chasing price deals and margins shrinking to unsustainable levels, newsagents are left to take on the season in the hope of attracting shoppers who may stick around through the year.

Competing with Big W, Officeworks and school booklist specialists is purely a margin game. Customer service is rarely considered. Supporting local jobs is also rarely considered. How slim are we prepared to go to win a Back to School customer? For the average newsagency business this is a significant challenge.

I pulled out of Back to School in one of my newsagencies a few years ago when a financial review showed I’d need 300% increase in sales just to break even in the face of high shopping centre costs.

I know of some newsagents who are tremendously successful with Back to School. The most successful tend to fall into two camps – managing school contracts in a warehouse operation run outside the newsagency and a long-term and well-known shopping centre based outpost.

I decided to run the survey to provide newsagents with an opportunity to register their view. I also wanted to give suppliers an opportunity to hear what the channel thinks.

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Newsagency management

Celebrating Women’s Health 5th birthday

We have been promoting the Women’s Health 5th birthday issue with prime placement in the usual location with health titles for the magazine as well as prime placement in among Cleo and Cosmopolitan. We will maintain this co-location through the on-sale, chasing extra purchases.

Five years is a terrific milestone, Women’s Health is an important title for us.

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magazines

Free eBook offer from The Australian

In print edition of The Australian today is a code providing access to a digital copy of John Howard’s autobiography Lazarus Rising. It’s a good given, well targeted. Smart, too, to connect readers with the digital platform.

I was surprised to see that readers at the website need to subscribe to get the code – given that free copies of the newspaper are so widely available.

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Media disruption

QLD Newsagents miss out on a Melbourne Cup newspaper deal from News

News Queensland has written to QLD newsagents encouraging them to promote a Melbourne Cup deal to local pubs, clubs, restaurants, hotels, RSL’s, Surf Clubs, Golf Clubs or Bowls Clubs in their area. While distribution newsagents will benefit from the promoted deal, retail newsagents miss out. Many retail newsagents will run Melbourne Cup related promotions yet they are not offered an incentive to make a Sunday Mail or Courier Mail offer as par of this.

News Limited continues to ignore and disrespect retail only newsagents. these businesses can play an important role for newspapers if only publishers worked harder at developing relationships with us.

here is what News sent to newsagents along with a flyer:

Are you interested in picking up some extra sales for Melbourne Cup?

I have attached a form that you can use to approach any local pubs, clubs, restaurants, hotels, RSL’s, Surf Clubs, Golf Clubs or Bowls Clubs in your area who may be interested in receiving either the Sunday Mail or Courier-Mail  from Sunday 4th to Tuesday 6th at 50% off.

How does it work?

a)      Approach business and sell in offer (minimum 30 papers per day)
b)      Fill in paperwork then fax to QN on 3666 8643
c)       QN add these supplies to your stock for you to deliver on the required day
d)      You invoice the venue at 50% off RRP
e)      QN will credit your account.  You will earn sub agent commission on each paper sold.  There will be no returns.

I understand why they are promoting through this season to these businesses. It’s their loss that they don’t have a plan for retail newsagents too.

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Newspapers

One Direction opportunity

The One Direction story on Sunday Night on the Seven Network last night is an excellent reason to get the Girlfriend One Direction part series into a high traffic location. The interview reinforced the marketing power of the boy band – something we can use to sell magazines.

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magazines

Stunning Cosmopolitan Bride display

I love this display created y the team at one of my newsagencies to promote sales of the latest issue of Cosmopolitan Bride magazine.

I like the detail reflected in the display, how they have provided a wonderful backdrop that holds up the magazine as the hero and connects with the prize opportunity available with this issue of the magazine.

Click on the image for a larger version.

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magazines

Newsagency marketing tip: refuse to believe what you hear

The continued talk of tough time in retail frustrates me just as talk from others saying their newsagency is doing it tough because of the decline in print media. There are enough newsagents enjoying success out there to tell us that it’s possible to be doing well right now, it is possible to be enjoying year on year growth.

I think it’s a choice we can make: to trade above the talk of those who would have you join them in a cloud of negativity.

The thing is, chasing growth is hard work, relentless work. It’s risky too. The keys are to be accountable for your situation, pick yourself up from any setback and ignore those who want you to think you should perform as poorly as them.

I know a bit about this from my work with newsagents in trouble. I’d be happy to talk m with and help any newsagent who reaches out.

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marketing tip

Newsagency management tip: get real data on magazines

I have been thinking about the comments from newsagents on my post on Friday about an alternative billing model for magazines. I know from my work with newsagents for many years that most do not look at their own magazine performance data – data that could have been used by them to address the magazine supply issue.  If you want to get an accurate understanding of the performance of magazines i your newsagency run your MPA Magazine Performance Report and or the Magazine Sell Through Rates Report. Both will provide a factual view of the performance of magazines in your newsagents. I’d be happy to discuss reports you produce.

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magazine distribution

Terrific newspaper book collection giveaway news to customers

We, like many Victorian newsagent,s have been handling the giveaway with the Kid’s Mini Book Collection with the Herald Sun this weekend. The bag together with the book make for a nice premium gift.

From what I’m told though, most people buying the newspaper did not know about the promotion. Oops. It’s a pity as this is the type of promotion that pitches the newspaper in a good light.

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Newspapers

US Postal Service to trial same day delivery

I mentioned here months ago that same day delivery was the next big thing in online shopping. There was further evidence of this this week with reports that the US Postal service is to trial same day delivery for online retailers.

We have print media disruption and retail disruption challenging the traditional business model.

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retail
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