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

Author: Mark Fletcher

Over the counter bill payment is dead

I was talking with a newsagent last week who was keen for a bill payment option for newsagents even after the financial collapse some years ago of Bill Express.  I was surprised as I have considered that over the counter bill payment is dead, not only in newsagencies but everywhere. Sure there are some who prefer to pay bills in cash but that number is declining from what I understand talking to people within Australia Post.

The infrastructure cost, not IT wise but cash handling wise, is too expensive for there to be any money to be made even if there was upside from a customer interest perspective.

The cost and infrastructure issues aside, as a retailer I question the cost to the business of the disruption of a bill payment transaction compared to the traditional newsagency transaction.

Newsagents hanging on to the possibility of a bill payment solution need to let go.  Some still hang on to the promises made by a newsagency software company in the 1990s about their bill payment solution and their million dollar data centre.  Smoke and mirrors as I said at the time.

Hmm … now that I have written this I bet there is an announcement showing I am wrong.  If this happens so be it.

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Bill Express

Simply Knitting magazine App

I noticed this ad on a business news website last week, pomoting an App being launched for Simply Knitting magazine in the US via the new Apple Newsstand facility.  The latest developments from Apple in this space are certain to lure more publishers into pursuing subscribers through digital platforms.

I hope that newsagents are noticing these moves and are ensuring that their businesses are appropriately flexible.

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Media disruption

October is too early for Christmas carols

At a shopping mall in Manilla last week I heard Christmas carols being broadcast to the shoppers – two and a half months out from Christmas.  Seriously!  Maybe they get in early so that they can start easter promotions at the end of December.

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Ugh!

Featuring Prevention magazine

We are featuring Prevention magazine with this in-location display in our new women’s magazine aisle.  We will usually maintain this double pocket allocation for the first two weeks, less if sales mean we don’t have enough stock for it.

We are careful with these in-location displays, ensuring that we only have one up in each space at any one time.  They continue to perform as well as or better than an aisle end display.  I think this is because they are closer to the destination of shoppers, where they actually start to look at what they are visiting for.

Since the Prevention moved to a full size format a while back it has been easier to display in more traditional magazine fixturing.

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magazines

Promoting the magazine and the diary

Where possible this year we are promoting branded 2012 diaries with their companion magazine.  While this will be a challenge the closer we get to Christmas, we have the space for it at the moment.

Girlfriend magazine and the Girlfriend 2012 Diary next to each other (see photo) offers a better chance of selling both.  They are in an eye-level position … prime space.

We are also reminding our team members that diaries make an excellent Christmas gift.  For example, the Girlfriend 2012 Diary is an ideal gift to the Girlfriend reader.

Talking about diaries, current indications are that there is no slowdown in diary sales, the plethora of mobile devices with diary facilities is not diluting the need for or interest in a hard copy diary.

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magazines

Coverage on SA newsagent concerns over lotteries

Adelaide Now has a story on concerns held by newsagents about the possible privatisation of SA Lotteries.  It is good to see the ANF agitating the state government on this issue which is close to newsagent’s hearts.

Newsagents need to agitate on this issue and indeed every issue which challenges their model.  Our businesses are finely balanced, which each part of the business relying on the other parts for support.

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Lotteries

Appalling retail customer service gets talked about

A couple of friends shared with me their story of appalling customer service they recently experienced in a newsagency.

They had been in the shop for 10 minutes or so, selecting around $25 worth of stationery to purchase along with a magazine.  On their way to the sales counter, the stopped at the newspaper stand and picked up a newspaper.  They were from out of town and wanted to decide whether to purchase it.  Less than 30 seconds after picking up the newspaper they were hassled by the newsagent.  The rudeness of the approach resulted in them putting the newspaper down and purchasing only the items they had already selected.

While a newspaper purchase would not have added much to their basket, it may have got them enjoying a paper which they would buy again.

I doubt they will go back in the newsagency.  Indeed, their story of what happened is likely to encourage others to not shop in this business.

There was no need for rudeness, especially given the value of what they were purchasing.

Some people should not own a newsagency.  Customer service is just about all we have going for us. Bad word of mouth about one newsagency reflects badly on the whole channel, unfortunately.

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Customer Service

Leveraging interest in Taylor Lautner

We are promoting the latest issue of GQ magazine is a good location so that Taylor Lautner fans are more likely to see the title.  besides the usual GQ shoppers, there may be a Twilight fan or two who picks up a copy – hence the placement showing off the full cover shot.

We are also looking for time at the counter for this issue of GQ.  I can see it as something which would be purchase don impulse by the shopper who is a fan of Lautner.

We are always looking at magazine covers for opportunities like this.

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magazines

Our own Steve Jobs shrine promoting Rolling Stone magazine

We promoted the Steve Jobs cover story in the re-issue of Rolling Stone magazine with this behind the counter display at one of my newsagencies.  The display looked stunning … there is no missing this as you enter the newsagency.  Our goal was for the Rolling Stone story to be noticed by everyone who may possibly be interested in the story of the life and passing of Jobs.  This counter display achieves that.  It’s driving impulse business as well as good customer interaction.

 

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magazines

Promoting the 10th anniversary issue of donna hay magazine

We have been promoting the 10th anniversary issue of donna hay magazine with this simple yet visually effective aisle end display facing shoppers as they enter the newsagency and head toward our magazine department.

I love the white cover of this issue, its stands out beautifully against the colour of all other magazines in a typical newsagency magazine department.

In addition to the aisle end display we have this issue of donna hay in with our food titles.  when the aide end display comes down we will give the issue support somewhere else in addition to the usual location.  Being the anniversary issue warrants more than usual support from newsagents.

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magazines

Sunday marketing tip for newsagents: Newspaper headline art

If you want to run a customer competition which gets them creatively engaged with newspapers, consider a headline art competition.  Keep it simple.  Ask that they create an item of art using recent newspaper headlines.  It could be visual or written art, as long as headlines are used.  Get a local panel of art experts to judge the winner.

The prize does not need to be grand.  The real reward is in entries and finalists being on show in your newsagency or somewhere nearby where you can leverage your involvement.

If the competition revolves around headlines in the local newspaper which is sold in your store all the better, especially for coverage of the event.

This marketing tip would be especially useful for newsagents facing competition from other outlets selling newspapers nearby.

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Newsagency

Steve Jobs covers at the newsagency counter

We have both Time magazine and the re-issue of Rolling Stone with Steve Jobs on the cover at the counter, above our newspapers, this weekend.

This tactical placement is in addition to promotion elsewhere in the newsagency.  There is no doubt we see a different mix of customers on the weekend, like in most shopping centres.  This mix of shoppers is more likely to purchase these magazines because of their Steve Jobs coverage.

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magazines

Promoting the Better Homes and Gardens Christmas feature

We are promoting the Christmas issue of Better Homes and Gardens with this in-location display in one of my newsagencies.

In addition to this terrific display, we also have the magazine in a stand facing into the mall and with newspapers – making the most of the launch week interest and leveraging the TV show from Friday night.

All the activity is working a treat, sales of BHG are excellent.

 

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magazines

Newsagent calls for a direct approach to magazine publishers

Check out the call John Emmery from Riverstone News has put out to newsagents re one way for newsagents to approach the issue of over supply:

We’ve tried all sorts of strategies over the years to incentivise distributers to reduce over-supply of mags.

Here’s a (serious) idea.  Please let me know what you think…

Send me your best example of over-supply for the month with the history.  Here’s mine for example…

Business for Sale ( code 25020 – NET)

V11#66 20/5/09 rec’d 18, returned 9

V11#67 28/10/09 recd’d 19 returned 11

V11#68 28/4/10 rec’d 20 returned 12

V11 #69 15/10/10 rec’d 26 returned 21

V11 #70 29/4/11 rec’d 26 returned 22

V11#71 14/10/11 rec’d 27

I will select the best example of over-supply, publish on this address, then send it by post with a lemon to the General Manager of the PUBLISHER.

What do you think?

The only stipulation is that is must be a magazine you’re received in the current month – no ancient history, please.

John Emmery.  Riverstone News.  0423 529 041

p.s. You might say that poor Network took over the above title from NDD and that some of the over supply was NDD’s fault.  True, but they obviously took over the supply history too, otherwise my supply would have changed radically.  So why did they ignore the returns data?

The magazine supply model is complex, way more complex than it ought to be.  There is no doubt that for many titles we are not supplied solely based on sales history.  Other factors can come into play including publisher action and distributor / publisher contracts.

The most success I have seen recently, as I have blogged here, has been as a result of direct contact with publishers.

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magazine distribution

Are newspaper publishers learning from doing newspaper home delivery?

With newspaper publishers taking on more direct home delivery services as a result of these being given up by newsagents, publishers are getting a better understanding of the economics of operating a home delivery service.

I wonder what the accountants in their organisations tell them about providing the service for the direct overprice and delivery fee revenue involved.

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Newsagency challenges

Promoting Dolly magazine

We are promoting the latest issue of Dolly magazine with this in-location display.  Emma Stone is in a movie which recently came out recently, The Help, so her placement on the cover is perfectly timed.  It’s a cover which could / should drive incremental business for us – hence the high profile placement.

It’s important for us to understand cover subjects and why they may help drive incremental business for us.  Time is a challenge of course. This is where we can engage our team members.  Younger employees will know Emma Stone and why having her on the cover is good.

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magazines

Loving Halloween

Check out the retail theatre created for Halloween at one of my newsagencies.  It’s shocking, in a nice way, and driving excellent sales.  Thanks to such a brilliant display we are competing with the cheap shops nearby who claim to sell on price but actually charge more for their products.  This display makes shopping with us for Halloween products more appealing.  This counters concerns over price – not that there should be any based on our price comparisons.

I love that the display is unlike what you would expect to see at the front of a newsagency.

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newsagency marketing

Speaking at Publisher’s Australia magazine conference

I will be speaking at the Publisher’s Australia conference next month and have planned the following topic.

The future of the Australian newsagency channel

A health check on the newsagency channel and tips on how publishers can more successfully engage with newsagents to sell more magazines and drive the value of this channel for your Australian titles.

This is a good time to be engaging with Australian publishers and I hope to show more how they can engage with us as a genuine value proposition compared to other retailers.

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magazine distribution

Supermarkets and free newspapers

I feel for a newsagent who supplies newspapers to a local supermarket as a sub agent only to have them give them away to shoppers who spend $5.00 or more in what is not a long-term marketing campaign.

The campaign has reduced the number of shoppers visiting the newsagency for their morning newspaper.  There is a knock-on effect on sales in other categories.

The newsagent is powerless to refuse to supply to their sub agent, competition laws being what they are.

It is hard to see a cost-effective campaign the newsagent could offer to compete given the limited range of day to day basic needs a typical newsagency sells.

 

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Newspapers

Warning on buying a newsagency computer system

As some newsagents have recently discovered, getting what is offered in the pre-sales process in writing is essential.  The amazing deal turned out to not be so amazing when they discovered that they had to pay a compulsory annual fee just to use the software and maintain access to their own business data.

  1. Get the offer in writing.
  2. Ensure that the offer fully documents what you have been offered.
  3. If there is a promise on annual support, subscription or access fees, make sure this is agreed in writing.
  4. Deals which sound too good to be true often are.

Sales people who are reluctant to document what they offer should be treated as you would an employee who does not want you to put in a security system or who does not want to use employee codes when transacting a sale.

There is one deal I heard of recently offering a complete system for less than the cost price of hardware and manpower offered.  The only upside a software company can leverage from such an arrangement is to charge more in the future for support or access to the software.  This often makes the great deal more expensive than other offers when considered over several years.

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newsagent software

Better Homes and Gardens Christmas display

Check out the display created for promoting the Christmas issue of Better Homes and Gardens at one of my newsagencies.  I love what the team has done with the collateral from Pacific Magazines, connecting with the Christmas theme for this display in a high traffic location – and making it easy for shoppers to browse and purchase the magazine title.

This issue of BHG is a top seller, getting out bold for this first weekend is vital.  I’d urge newsagents to go and check their placement of the title.  Make sure you have it in at least one more high traffic location in addition to the usual location for the title.  The first seven days are when you can drive easier impulse business.

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magazines

Newsagents swamped with screen advertising options

I am surprised by how many companies are offering screen based advertising solutions to newsagents.  I have looked at some and decided for the moment that this medium is not for me.

My preference is to have control and certainty over everything promoted in my newsagency.

I am also not keen on taking on an advertising platform which takes me and my team away from the core business of retail.

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Newsagency management

The challenge of higher EFTPOS fees for retailers

I am grateful to Hank Spier for chasing the following notes with me on the issue of the EFTPOS fee increase engineered y ePAL, the body controlled by the major banks plus Coles and Woolworths.

In February 2011 EPAL announced a new multilateral interchange fee regime to replace the existing bilateral arrangements. EPAL is made up of the banks and Coles and Woolworths. EPAL’s reasons for the changes is to get additional moneys for technology upgrade of the Eftpos network.

For those members of EPAL which opt into the new multilateral interchange fee model, the following fees will apply to the banks involved in an Eftpos transaction,

  • for all purchases of less than $15 (where no cash is withdrawn) there will be no interchange fee.
  • for all purchases of $15 and over, there is a fee of $0.05;
  • for each cash withdrawal (whether combined with a purchase or not) there will be a fee of $0.15.

The effect of the new regime is where there is a purchase of $15 or more, combined with a cash withdrawal there will be a fee of 10 cents.  To add to the cost impact fees of 4-5 cents rebate previously paid to the merchant’s bank has been abolished.

Normally such agreement between competitors will be subject to ACCC scrutiny but in this case the ACCC has not jurisdiction as the Reserve Bank has the regulatory role. The RBA has been generally supportive of the fee changes. The Federal Government has refused to get involved despite requests from small business.

There was much opposition to the changes from small business especially from the AHA and newsagents associations. ALDI took EPAL to the Federal Court alleging misleading conduct, namely that EPAL had been saying that it is unlikely that consumers would pay any more. The emerging facts were very different. ALDI won on 29 September. EPAL will have to place corrective advertisements in the national press. The AHA and newsagents associations assisted in the ALDI action.

The new fee regime came into effect on 1 October. It is up to individual banks what they do in relation to passing on costs to retailers. As a result of the opposition and the ALDI case two banks have backed off, the CBA has promised not to pass on the increased costs to retailers and NAB will limit the costs to be passed onto small businesses. St George has said that it will pass on increased costs.

Where banks do charge it is up to business to assess whether or not they pass on the costs to consumers, if they can.

Where the banks do pass on costs I suggest that,

  • business approach their bank to see if something can be done about the increase,
  • Trade associations look at collectively bargaining with those banks on behalf of businesses affected.

The individual fee increase involved is not high but will add up in high transaction volume businesses

While some banks have said that they will not increase fees, I don’t see this as their long term position.  They are banks after all.

I’d encourage newsagents to take Hank’s advice.

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EFTPOS fees

Including the gift inside the magazine

At Page One at Hong Kong airports a couple of days ago I noticed this display of magazines.  The stack is so high and each magazine bulging because of the free gift included between the pages of the magazine.

Each magazine was wrapped separately to facilitate easy stacking – essential in a high volume business like this where each title has its defined space and cannot go beyond it and where their will not tolerate having to clean up junk which falls out of titles.

Of course, in high traffic transit locations shoppers don’t spend the time browsing titles that we would experience in newsagencies back in Australia.  While I complain from time to time abut the space magazines with free gifts can take to display, being able to show off the gift can deliver a far better sales outcome for us.

 

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magazines
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