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

Author: Mark Fletcher

How the telco world is changing

A friend put me on to the Viber App a few weeks ago while I was overseas.  It lets your phone call another phone with the Viber app, using a wireless network, at no cost.  This means that I could call the office, friends and others with a Viber app on their phone and avoid having to call through a hotel or my regular mobile service.  The savings were extraordinary.  Viber is, in my view, easier and better than Skype.  Ideal for business travellers.  It’s also easy for businesses to call businesses.

No, this is not an ad.

My point, I guess, is that who’d be a telco right now?  Seriously. They are migrating from making money from phone calls to making money from the overarching network.  Hence the importance of the NBN play.  It’s a major structural shift for the telcos.  Not unlike the structural shift we are seeing in print and experiencing in newsagencies.

All around our businesses, and inside our businesses, change is the order of the day. Telcos are walking toward and even through change.  We need to do the same.

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Media disruption

Appalling handling of a page one news story by News Limited

Shame on News Limited for allowing the news photo on the front page of The Advertiser newspaper on Saturday of the new South Australian Premier to be covered by a stuck-on ad for X-Lotto.  As the newsagent who shared the photo with me noted, this is disgraceful.

If the ad is more important than the photo then why not just sell advertising space rather than disrespecting the photo?  This placement gets the ad revenue and lets News Limited make a political statement.  While people at News may say that this was not their intention, it would certainly be reasonable for people seeing the ad to take the handling of the photo as commentary by the newspaper.

The circulation people at The Advertiser would be unhappy if a newsagent blocked the front page of the newspaper in a newsagency.  What they are doing to their own product is the same thing.  It tells newsagents that seeing the main story of the day is not that important to selling newspapers.

I want to see newspapers and their editorial content respected.  These stuck-on ads leave me wondering if publishers allow it now because they care less today about the medium than previously and want to extract as much revenue as possible as long as it lasts.

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newspaper masthead desecration

Customers love the photo Christmas card

Customers are loving this photo Christmas card we have in our boxed Christmas card range.  Their feedback is that it is ideal for sending to people you wold not send a gift to but want to give them something more than a regular Christmas card.  It also works well for people living away from family members – the photo gives the recipient a keepsake for the year.  Our price of $6.95 for six cards is a good value deal … plus each box sold raises 10 cents for the RSPCA.

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Greeting Cards

Promoting the 2012 frankie magazine calendar

We were fortunate to get stock of the 2012 frankie magazine calendar.  Placed next to the frankie magazine it is selling well.  We will be out of stock in a couple of days.

Getting known in the area as the go to place for frankie products – the magazine, diary and calendar – is important as it makes us relevant to a demographic which is a challenge for the more traditional (old school) newsagency business.

We are focused on being relevant to younger shoppers, from primary school through to mid twenties, while maintaining relevance to older shoppers.  Our growing sales of frankie magazine show that we can attract more of the younger shoppers and make this commercially viable for us.

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Calendars

Newsagencies cheaper than supermarkets and others for Halloween products

A week back we shifted focus of our Halloween display to face out into the shipping mall.  The display has been drawing excellent traffic.

At the newsagency yesterday a mum was dragging her kid away saying that the fork and face mask would be cheaper at the at another shop.  Well, no. I checked our prices against others in the centre and we are cheaper.

I’d go as far as saying that newsagencies are the best value shopping destinations for Halloween product.  We are promoting our price difference with some posters this week.  however, we have to do this in a way which does not breach our agreement with the landlord.

From what I can see, supermarkets are using Halloween products to claw back GP from the thousands of items they are discounting.  i.e. get them in with cheap milk and bread and charge way more than they should on Halloween product.

I’d urge shoppers who come by this post about Halloween to shop at their local newsagency for Halloween products.  You are likely to find a better range at better prices.

Newsagents with Halloween products in their newsagency and a Facebook page – promote it this week and be sure to promote that your prices are competitive.

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Gifts

Bill Express connection should kill activ8me NBN roll out involvement

Further to my post of a few days ago, I have written to the Communications Minister to express concerns about activ8me being involved in the NBN given the pedigree of the company and the damage they and those associated with them wreaked on the newsagency channel through Bill Express.

Newsagents were lied to by those selling Bill Express into our businesses when they got us to sign five year agreements, often based on false and misleading information.  We were let down by the organisation itself through its management of its affairs.

The cost to our channel of the Bill Express mess was tens of millions of dollars.

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Bill Express

Merchandise challenge from The Australian gets newsagents engaged

The national merchandise challenge run by The Australian through Facebook generated plenty of interest.  It got newsagents engaged with The Australian as well as with Facebook.  You only have to look at the Facebook page to see the fun some had with the opportunity.  It also generated sales from what newsagents have told me. Display competitions like this are terrific for these reasons and that they give the business a fresh look for the duration.

The photo is just a small part of the display activity from newsXpress Bondi Eastgate the National Winner as well as the NSW/ACT Winner. Talk about engaging with your product!

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Newspapers

What’s wrong with our sales of The Monthly this month?

While there are reports that the latest issue of The Monthly magazine, with the Andrew Bolt article, is selling well, we have not sold a single copy.  It was in a good location with the cover on display.  Yesterday, I moved it next to the Herald Sun.  Hopefully this move will generate some action for us.  This is the first issue out since the magazine relay I did, maybe that’s it.  We’ll see over the next couple of weeks.

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magazines

Home Beautiful display drives sales

Our promotion of Home Beautiful magazine is driving sales.  We are set to beat our average and that’s the goal with a title we promote by giving it premium space.

We always track the sales results for each title we invest time and space into.  Otherwise, what’s the point of the displays.

Checking the sales results for a specific date range is easy … vital to good magazine management.  This data helps us make decisions as to which titles to promote in the future.

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magazines

Tough quarter for Officeworks and stationery

Check out this from the report by Inside Retailing yesterday about the September quarter results from Bunnings

It was not such a pretty picture in the sister operation, Officeworks, which retails stationery.

Total sales for the quarter were $361 million, up just 0.3 per cent on the corresponding period last year when the division posted a 9.9 per cent increase on the 2009 year figures.

There is no doubt from the data I am seeing that the September quarter was tough for newsagents in terms of stationery.  Seeing a major in the same situation is somewhat comforting.  The thing is … we need to reverse this and kick-start stationery sales outside of the once or twice a year push.

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Stationery

Feedback from a magazine customer about their newsagency experience

Check out this feedback from a magazine lover about their encounter with an Australian newsagent earlier this week.

So disappointed with my local newsagent.  I went early to get the latest issue of [title deleted]  (I always count down the days till the release date)

.  There they were sitting on the bench of the newsagent so I was super excited and I asked the owner can I please have the new issue. (pointing in the direction)

.

The newsagent responded with “no you can’t have those I am not opening that now”.

Magazines are vitally important to our individual newsagency businesses and to our channel as a whole.  We, all of us, need to work the titles we receive, especially Australian titles.  We need to regular magazine shopper, whether weekly or monthly, to drive sales of other products we sell in our businesses.

I am confident about the accuracy of this story.

In my own newsagency businesses we resource appropriately so that we get magazine product on the shelves early, well ahead of any other retailer nearby.  We gladly open bundles if we have yet to put out a title being sought by a shopper.

While we can respond to this story with our customer complaints or complaints about magazine publishers and distributors, a better response would be to remind our team members and our colleague newsagents that we need to get magazines right every time as they are our only national point of difference right now.

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magazines

Halloween behind the counter in the newsagency

Click on the image to see the detail of our behind the counter promotion for Halloween at one of my newsagencies.  With so many other retailers coming on board Halloween is getting easier.  More competitive, certainly.  Easier too as it is better understood and more mainstream.

For average-side newsagents Halloween can be a $500 through to a $5,000 season.  It’s certainly traffic generating.  Our front of store display pulls a younger than usual audience to our newsagency.

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newsagency marketing

Digital subscription to The Australian announced

I was fortunate to be briefed by News Ltd yesterday about the launch of a digital subscription service for The Australian which will launch on Monday.

The Australian is the first of the News Limited newspapers to move to the long talked about paywall model.  On Monday, they will start with a free three month trial.  This will be followed by a ‘freemium’ model – some content will be free but the good stuff will be behind a pay wall.

On Monday they launch a redesigned website and a new m-site for mobile devices.  The iPad App stays as is for the moment. After the three month free trial period, the price offers will be:

  1. $2.95 a week for what they are calling The Australian Digital Pass.  This will give you access to the entire website, iPad and Android Apps plus the m-site.
  2. $7.95 buys you The Australian Digital Pass for 7 days and the print newspaper home delivered for six days.
  3. $4.50 buys you The Australian Digital Pass for 7 days and The Weekend Australian home delivered.
  4. $5.20 a week buys you The Australian Digital Pass for 7 days, The Weekend Australian home delivered and one more single weekday edition home delivered.
  5. Existing six day subscription customers will receive the Digital Pass for no extra cost.

I like that they have print in with the mix.  While I am not a fan of paywalls, I understand that publishers like News have to take this step.

What the folks at News do not have an answer for at the moment is how newsagents could engage in selling the $2.95 a week Digital Pass. News is open to suggestions on this.  It is with their permission that I encourage newsagents to email their suggestions on how we could sell or promote or otherwise commercially engage in the Digital Pass.  Email your suggestions to: circulation@theaustralian.com.au.

It would be relatively easy for newsagents to sell coupons to pay for the digital subscription, like we sell the iTunes cards today or like a phone card on the eziPass platform.  We could also sell it directly through our newsagency software and gather required customer details for emailing by News of login for the digital content.  So a technology solution is achievable at the newsagent end, feeding data real-time to News.  There is a question whether News has the appropriate technology at their end to receive this data real time for efficient handling.

I have put the idea of a newsagency software based technology solution to News.  I’d encourage newsagents to put their ideas to the company.  This is at their invitation.  They are genuinely interested in engagement suggestions around driving uptake of the Digital Pass.

There will be some reading this saying that we should do nothing to assist or support the uptake of the Digital Pass.  Resistance or lack of engagement by newsagents will not slow or block the progress of the Digital Pass.  News is doing what I would do if I were them.  It is no different to magazine publishers embracing the iPad and Android devices or lottery companies selling their products online.  Such moves are inevitable.  It’s why we need to be reinvent our businesses outside of our business with magazine and newspaper publishers.

How we engage on opportunities around The Australian could define what we do when this model is offered for the state based dailies in the News Limited stable.

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Media disruption

Lego Christmas cards popular

We have a couple of designs of Lego licensed Christmas cards in our boxed Christmas card offer and customer reaction is terrific.  They love the humour and that these are fair-dinkum lego cards.  The reaction is a reinforcement of the value of supporting brands – sales are easier and word of mouth drives return traffic.

Click on the image to see one of these funny cards.

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Greeting Cards

Promoting Women’s Health magazine

We have been promoting the Latest issue of Women’s Health magazine at my newsagencies. The most successful approach we have found is in-location displays as the photo shows. It makes Women’s Health the hero title in the women’s magazine aisle for the first week of the on-sale. We pull back but slightly in subsequent weeks.  I’d note that this location is on the same side and just one step away from marie claire, Cosmolpolitan and Cleo.

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magazines

Buy and Sell Classifieds TVC to help drive sales

Buy and Sell Classifieds, a Queensland classifieds title distributed by IPS, will be running a Television campaign to promote their classifieds newspaper.  The campaign will be running on Queensland digital channels 11 and One HD for remainder of the year.

While the ad does not tag newsagents it should certainly raise awareness of the title, offering a good reason to give the title prominent positioning in-store. This is what I would do if I were in Queensland.

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magazines

A Bill Express connection with the NBN roll out?

activ8me is one of the companies tied up with the Bill Express mess and they have been announced as a seller of NBN satellite and some other services. Technology Spectator has the story.

For a bit of background on activa8me and where it sat within the Bill Express mess click here.  For more on Bill Express, click on the link to the right.

While I’m no lawyer, I would have thought that there were enough concerns on the tale regarding the lineage of activ8me for it to not be part of the NBN story.  But, hey, maybe it’s all been cleaned up…

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Bill Express

Switching card companies could hurt your newsagency

I have been talking with newsagents recently who made changes to their card supply arrangements which have resulted in them being worse off.

One newsagent switched from one the major card companies to a smaller company on the claim that sales would increase and the offer of a margin boost.  Their sales, year on year, are down 25% following the move.  The extra 5% margin they negotiated is worth nothing.  They are worse off.  It is easy for a card company to offer a bag of cash or a boost in margin.  The harder road is to help you boos sales.  However, boosting sales is better for you.

Another newsagent went from 100% with one company to 75%.  The net increase in sales year on year was 2%.  However, the sales drop for their main supplier, due to 25% less pockets, resulted in the newsagents dropping to a lower rebate grouping.  Financially, they are considerably worse off.  A lack of research leading up to making the decision has resulted in them losing money.

Some card company sales representatives are less than accurate when outlining hat a switch to their business would mean for the newsagent.

My advice to newsagents is caveat emptor, let the buyer beware.

  1. Take your time, talk to newsagents who have moved.  Ask for details of the financial impact.
  2. Get every claim and every offering writing and signed by senior management of the company with authority to sign.
  3. If you are moving because of unhappiness with your current arrangements, take time to ensure that your existing supplier is afforded every opportunity to fix any problems.
  4. Get a written guarantee on the financial benefit of the move.

The two newsagents I have worked with don’t have anything to go off and cannot therefore easily get out of their worse-off situation.

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Greeting Cards

Food magazine relay boosts sales

We are still seeing growth in food magazine sales as a result of the magazine relay I undertook a month ago, nice double digit growth.  This is a category we shuffle a couple of times each week, responding to new titles as they come out.

We are maintaining excellent positioning for the anniversary issue of donna hay magazine while also promoting the latest issue of MasterChef and promoting the latest issue of Feast magazine.

I do the shuffling when I am in the store myself as I see this as a senior management task.  Too often newsagents leave choices about magazines to be made by juniors … and they then wonder why magazine sales are not what they need.

I urge newsagents to look t the magazines and invest the time in completing relay.  There is money to be made from a small investment of time.

 

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magazines

Promoting the read ezy 2012 calendar

The counter is the best location for read ezy 2012 calendar. Shoppers often ask for this. Having it at the counter makes offering the upsell easy too.

With an excellent margin, more than double magazine margin, it’s a product worth pitching to anyone 65 and over and those with family and friends who are 65 or more.

This is the kind of product that some people will not think abut until late in the season – offering it to shoppers now is doing them a good service and driving sales basket efficiency.

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Calendars

The $1 magazine sale in the US

I don’t understand some US magazine publishers.  At magazines.com there is a SALE running at the moment offering a bunch of magazine titles for $1 per issue or less.  Time magazine, for example, is available for $16 for 28 issues, Good Housekeeping has 12 issues for $7.97.  These are US only offers for US published titles.

Yes, the US model is different to Australia.  But that different that they have to devalue their product this much?  I’d want people to buy my title because of the value they see through reading the title rather than some cheap-ass deal.

Crazy.

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magazines

Will newsagents ever learn about employee theft?

I have been working with another newsagent this week on an employee theft / fraud issue.  It was the lax processes around managing cash which led to the newsagent being hit for at least $50,000.  They did not worry about balancing their registers accurately each night, they also did not manage stock on hand.  These weaknesses in processes invited the thief to act… and they did.

Check of the story in the Herald Sun yesterday about employee theft.

Newsagents are their own worst enemies sometimes.  Here are some very basic rules to help newsagents avoid employee theft.

  1. Use your newsagency software properly including the full stock control facilities – they pay for themselves in no time with theft saved.
  2. Balance your registers at least daily.  If cash is out by more than $5, hunt it down.  Demand that employees are responsible.
  3. Use employee initials and codes on all sales.  Yes they can fudge this.  Just doing it is a hurdle many newsagents do not have today.
  4. Track stock on hand for tobacco products, transport tickets, phone cards with a face value, confectionery, ink cartridges, premium pens and, stationery.  Start slow and work your way up.  You will bank results from the work and eliminate the need for an annual stock take.
  5. Establish a theft policy and publish this to your employees.
  6. Change your system passwords monthly.

If the newsagent I was working with balanced their cash daily and tracked cigarette inventory they would have uncovered the problem much sooner.

Cutting the cost of employee theft in a newsagents is straightforward, all it takes is will on the part of the newsagent.

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Newsagency management

Moshie Monsters out today

An Australian edition of Moshie Monsters magazine goes on sale today.  It has tremendous potential given the reported 5 million Australian Moshi Monsters users and given strong TV promotion on both free to air and pay TV starting today.  Targeting 6 to 12 year olds, this new monthly title could help us increase traffic and sales in our kids section, a magazine section which has been challenged in recent years.

I plan on us making the most of the launch with a good display in a high traffic location.  It’s the kind of title which could work at the counter, especially is at kid eye level.

To newsagents considering early returning this new title, I’d suggest you ask parents and 6 to 12 year olds.

 

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magazines
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