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

Author: Mark Fletcher

How sub agents are treated

Newsagency B is a sub agent of newsagency A because the previous owner of newsagency B sold the distribution business to newsagency A before selling the retail business a year or so later. Today, a couple of years on, the relationship between the two businesses is seriously challenged. Newsagency A supplies newspapers to newsagency B and engages in some odd behavior. For example, when they close at lunchtime on a Saturday, they will not release all remaining newspapers to newsagency B Newsagency B consistently sells out and newsagency A has returns which could have been sold.

With more newsagents selling their runs and therefore more ‘sub agents’ being created, newspaper publishers will watch this behavior and, I hope, act in the interests of consumers and their product. An old school lording over his territory as may have happened thirty years ago is not good business for anyone other than this newsagent’s bitterness.

If it looks to a customer like a newsagent it is a newsagent in my view.  Some old-school newsagents will claim that a retail outlet which does not have a direct newspaper accou t is a sub agent.  Some will think they can treat the ‘sub agent’ as a second class citizen.  Shame on them.

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Newspapers

Magazine 2.0: Anthill

anthill.jpgAs the cover proclaims, much of the latest issue of Australian Anthill magazine has been written by readers. User generated content is pretty innovative in magazine circles. If you are a follower of the Anthill website you will understand that this is a logical next step for the innovative independent publisher.

Update (19/2): No sooner had I posted this and the news hit that Anthill was to move from monthly to quarterly.

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magazines

Update on Bill Express court case

Hank Spier, legal counsel for the NANA initiated Class Action on Bill Express, has provided the following update on the action brought against the company by the ACCC.

There is a scheduling meeting in the Federal Court in Melbourne on 12 March. That will set the date for the trial.

Mobius and Bank of New York Trust have undertaken not to pursue any payments from newsagents until the Court action is over.

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Bill Express

Newspaper sales leaking from newsagents to supermarkets

It is interesting to see how newspapers reported the latest circulation figures.  Check out: The Australian, the Sydney Morning Herald and The Age.

The audit figures published on Friday only tell part of the changing newspaper circulation story.  Based on newsagent sales benchmark data I have, newsagents lost retail sales of newspapers at more than double the reported audit numbers, three times in some cases.

We are experiencing considerable sales leakage to other retail channels such as supermarkets and petrol and convenience. This is the only explanation I can see for our channel experiencing a sales decline which is greater than the audit numbers reported by the newspaper publishers.

Why newspaper publishers would want to push this further by opening new retail outlets is beyond me if we are the retail channel they prefer as they say.

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Newsagency challenges

Generosity everywhere

fhn_appeal.JPGnewsXpress started promoting support for the Red Cross bushfire relief appeal last Monday.  In addition to promoting direct donations, we have been collecting change from customers.  Many customers donate more.  The support is overwhelming, people cheerfully giving without being asked.  We are banking this money direct into the Red Cross account and will display the receipts for our customers as we go.

If we see ourselves newsagencies community focused then supporting the bushfire appeal is important, not something to think too long about.  VANA took days to engage and provide advice to its members of their fundraising plans.

The collection containers are chained to the counter because of stories of some being taken.

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Social responsibility

The old Christmas magazines

fhn_christmasmusic.JPGI had a customer ask on the weekend why some of our overseas magazines are current issues and others are old.  He was pointing to Classic FM and BBC Music Magazine.  Both feature Christmas music and both came in this month.  While I had an answer, he has a point.  If we are magazine specialists then we should have current issues.  Out of date stock – two months out of date – makes our businesses look out of date.

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magazine distribution

US magazine distribution fight goes to court

fhn_mags1.JPGFolio reports that a fight in the US about magazine distribution has gone to court.  Interlink is claiming that some publishers, including some major names, conspired to try and force it to sell its business to a rival publisher.  This issue flared up when Interlink announced it would apply a distribution surcharge of seven cents a copy to distribute magazines.  The National Ledger has another perspective on this fight.

I am mildly interested in this case because it is about the cost of access to a magazine distribution network.  Magazine publishers in Australia have access to our newsagent network (if we can reasonable call it a network) for no cost imposed by us.  Magazines distributors have inserted themselves between our retail outlets and magazine publishers.  Thye are the gatekeepers to this asset we have, more than 4,000 retail outlets perfectly located.  Indeed, they charge the publishers and they charge us.

While magazine distributors provide logistic and some other services, it is our shelf space and our placement of magazines in categories so consumers find them by interest that is a real yet undervalued benefit.

There is an opportunity for newsagents to explore alternative models based around a more direct newsagent / publisher relationship.

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magazine distribution

Who supports Victorian bushfire appeal

fhn_who_fire.JPGWe are promoting the special Victorian bushfire tribute issue of Who with our newspapers this weekend. The 10 cents being donated from every copy is a practical support to the relief effort. we have the magazine in three high traffid places in our newsagencies to ensure that we achieve a sell out.

On the 10 cents per copy donation, I think it is important for businesses supporting the bushfire appeal to be specific in the money which will be donated from purchasing. Saying you will donate profits for a day is less specific.  Who can say how much an action raises.  I think customers want to know.

Virgin Blue has handled raising money for the Red Cross bushfire appeal well.  They are collecting donations on each flight.  On the five Virgin Blue I made between Tuesday and yesterday I heard them announce how much was raised and that the airline would match that dollar for dollar.  This level of transparency is excellent.  One flight raised $670, meaning the appeal receives $1,340.

Fundraising aside, this week’s edition of Who is excellent.   It provides a perspective which compliments the coverage provided by newspapers all through the week.

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magazines

Making love and money together

fhn_tatts_synd.JPGIn addition to a range of gifts and cards for Valentine’s Day, we are also promoting the $14 million Tattslotto superdraw for tonight.  Our team at newsXpress Forest Hill has developed a range of syndicates and printed posters for these in pink.

While this may not be quite the corporate approach Tattersalls may prefer, it is the approach which has worked well for us and has helped us develop excellent syndicate sales over the years.  It is our way of separating our Tattersalls outlet from others nearby.  Such personalisation is what retail is all about.

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Lotteries

The state of the newsagency channel

I’ve been fortunate to meet face to face with plenty of newsagents in Melbourne, Sydney, Brisbane, Canberra, Adelaide and Perth this week at the newsagent management workshops I have been running. Some common issues are on the minds of newsagents.  Curiously, not one question or comment about associations or unity – this issue is off the radar.  Here are some of the topics people did discuss:

Optimism. Plenty of newsagents are optimistic about the future and reflecting this in their investment in their businesses in shop fits and funding new product categories.  These opticistic newsagents come from businesses of all sizes and situations.

Change. Newsagents are talking about change more so than ever before.  Some are driving change in their businesses others are trying to work ot what change will occur.  My view is that we need to control change and that we do this in our space allocation, our attitude and our engagement with our teams.

Magazines. Oversupply, long shelf life and poor business practices make magazines frustrating for newsagents. Unless magazine distributors make progress on these issues, more newsagents will reduce space and even close accounts.

Newspapers. Newsagents say that with publishers wanting to get into more and more non-newsagent outlets they are less likely to see newspapers as a core product in their newsagencies.

Service. Customer service is the most popular point of difference being pursued by newsagents.  For some it is lip-service while for others it completely defines their business and every decision they make.

There were plenty more areas covered. In all, the week has been an excellent rolling conversation for which I am grateful to the newsagents who gave of their time to participate.

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Newsagency challenges

Monkey business for Valentine’s Day

frank_monkey.JPGOur team at Frankston has come up with a range of gift packs for Valentine’s Day. The one which intrigues me the most is the Monkey Business pack. Inside there are a couple of monkeys and a bottle of passion massage oil. Their goal in using themes with the packs and giving them a name is to bring some theatre to the occasion. Looking at the display as a shopper it works. All ages and situations are covered – usually with humor. The real test, of course, is in the sales. So far, so good.  Today is the real test for Valentine’s Day because it is with the last minute shoppers that you can do very well.

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Gifts

Stimulus package will help newsagents

In addition to the benefits you are likely to feel at the cash register from the passing today of the Federal Government stimulus package, the 30% investment allowance in the package means that if you spend money on capital improvement in your business in the next four and half months you can access a 30% investment allowance.

Tower Systems is adding value to the investment allowance offer with its own bonus package which includes an additional six months of support, free bonus training and package system prices at 2008 rates – before our dollar collapsed and drove hardware prices up.  We are also using our in hous accounting team to ensure that our offers are packages to achieve the best outcome for Tower newsagents.

With more than 1,500 newsagents partnering with Tower Systems today, we are well placed to help even more newsagents save time and improve business efficiency.

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newsagent software

Comprehensive software training for newsagents

Tower Systems yesterday announced a comprehensive schdule of free online training for newsagents using its point of sale software.  There are several new training programs including help for all the POS Solutions users transitioning to Tower.  Online training is free.  It is time friendly – do it at the shop or at home – and easy for staff to do without travel costs. Here is the schedule for the next two months:

  • 19/02/2009 11am Magazine Management Workshop
  • 19/02/2009 2pm Retail Stock Management – Configuration & Maintenance
  • 24/02/2009 11am Retail Stock Management – Reordering
  • 24/02/2009 2pm Magazine Management Workshop
  • 26/02/2009 11am Home Deliveries and Customer Management
  • 26/02/2009 2pm Magazine Management Workshop
  • 3/03/2009 11am Former POS Solutions Users – Helping Ease the Transition
  • 3/03/2009 2pm Point Of Sale Training
  • 5/03/2009 11am Magazine Management Workshop
  • 5/03/2009 2pm Home Deliveries and Customer Management
  • 12/03/2009 11am Point Of Sale Training
  • 12/03/2009 2pm Retail Stock Management – Configuration & Maintenance
  • 17/03/2009 11am Retail Stock Management – Reordering
  • 17/03/2009 2pm Magazine Management Workshop
  • 19/03/2009 11am Retailer Security
  • 19/03/2009 2pm Point Of Sale Training
  • 24/03/2009 11am Magazine Management Workshop
  • 24/03/2009 2pm Former POS Solutions Users – Helping Ease the Transition
  • 26/03/2009 11am Home Deliveries and Customer Management
  • 26/03/2009 2pm Putaway Management
  • 31/03/2009 11am Magazine Management Workshop
  • 31/03/2009 2pm Retail Stock Management – Configuration & Maintenance
  • 2/04/2009 11am Retail Stock Management – Reordering
  • 2/04/2009 2pm Point Of Sale Training

I am proud that Tower continues to innovate in delivering valuable training for newsagents.  It is this commitment which helps Tower Newsagents be the most IT compliant group of newsagents in Australia.

To book for any of the free online training sessions please go to the Tower website, select support and click on user training.

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Customer Service

Suppliers and engaging with newsagents

In between the newsagency management workshops I am involved with this week (off to Perth today), I have participated in several meetings with national suppliers to newsagents. I am fortunate to be able to do this often. In each meeting there has been mention of the challenges of engaging with newsagents. It usually starts with concerns about newsagent uptake of a promotion and that leads to a discussion about how the supplier engages.

Newsagents receive many communications from suppliers each day in the form of emails phone calls, letters and faxes. Way too many to be manageable an average size newsagency yet each sender expects the newsagent to read the communication and fully engage.  More than half the communications I see are inefficient and unclear in terms of the actions they expect from newsagents.  These are key factors in poor uptake.

I’d encourage suppliers who read this blog to look carefully at their communications with newsagents and consider:

  • Is the communication genuinely important? If not then don’t sent it.
  • Is there a commercial imperative for the newsagent? If not then reconsider sending the communication.
  • What is the outcome you want from the communication? Is this clear? If not, make it clear.  Edit.
  • Can the newsagent respond efficiently? Or are there forms to complete, details to other which will take time or other barriers to the action you wanted being taken?  Time you waste is time lost.

I see many communications from suppliers which are unclear in their goal and inefficient. Some judicious editing could help newsagent save time and improve outcomes for suppliers in terms of responses.

We are a time poor channel so suppliers please respect this, make communication more efficient and help us save time in working with you.

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Newsagency challenges

Entering the Valentine’s Day zone

fhn_val_entrance.JPGMy understanding is that males are more likely to buy a card from a newsagency than other outlets. We are trying to tap into this at Forest Hill by bringing Valentine’s Day cards right to the front of the shop, at the lease line. Rather than scare the guys off with too much tizz, this part of our Valentine’s offer is about the product and not wanting to overwhelm them. This approach has worked well for us before in the last week when around 85% of Valentine’s purchases are made.

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Greeting Cards

Bushfire donation stories

Feedback from my two newsagencies and four gift shops is that customers are thrilled to support our collection of change for the Red Cross Bushfire Appeal.  We are doing this as part of the newsXpress initiative announced Monday.  The notice we have with the collection container is that donations are best made direct to the Red Cross.  Even tough we are only asking for loose change, customers are leaving notes.  The generosity is wonderful to see.

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Social responsibility

Notice to newsagents: Bill Express and BOPO are dead!

bopoad_screen.jpgCheck out this photo from a newsagency in New South Wales.  The Bill Express screen is still up and turned on and running an ad for the dead BOPO prepaid Visa card.  No wonder we are considered a has-been retail channel by some suppliers.

If you have a Bill Express screen take it down or play other content.  Do not advertise BOPO because that makes you and all who share your shingle look bad.

We really are our own worst enemy sometimes.

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Bill Express

US Magazine sales fall 11%

US magazine retail sales fell 11% in the second half of 2008.  The same period a year earlier saw a 0.2% drop.  See the Wall Street Journal report on this.  Also check our Erik Sass’ report at Media Post for more an industry analysis.

The bottom line here is that magazine sales in the US took a considerable hit in the second half of 2008.  Magazines are not the recession proof category they have been before.

I think we will see similar numbers here in Australia.

Now, mroe than ever, newsagents need to engage smart strategies to protect their magazine business.  While consumers are spending less on the category, we have the capacity to pull business from non magazine specialists.  We do this by being the specialists not only in range but in display and, most important, value proposition.

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magazines

Dialogue with Universal Magazines

In October 29, 2008 I asked Is it time to Kill off Universal Magazines?  I wrote this in frustration about my inability to control the supply of product from Universal Magazines. After years of getting nowhere with suppliers on achieving an equitable supply arrangement for I felt I had to strike out and bring the supply model issue to a head. That morning, Universal was on my mind because of what I saw in my shop.

A couple of weeks ago I met with senior executives of Universal.  This was a good business discussion around the challenges from both sides and how the magazine distribution model is a real barrier to publishers and to newsagents.

In the months since the initial blog post, Universal executives have dug deep into the magazine supply model to understand why I and other newsagents who commenter to the post were so angry. The result of their investigation and reflection is improvements to processes and around the supply of their titles which did not exist last year.

From my own face to face discussions with the folks at Universal I also understand more about their goals. Interestingly, we agree on many discussion points. It is the magazine supply model between their business and my newsagency (and newsagencies around Australia) which is the barrier to an idyllic relationship.
magazine distributors lept to the defence of Universal quickly in October last year. The issue underscoring the blog post was their performance and decisions they make and not so much about Universal – it is breathtaking that they did not out their role in the problems at the time.

Hopefully, over the next few months, progress will be made on the model so that independent publishers and Australian newsagents can achieve a more mutually beneficial and rewarding relationship.

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magazine distribution

Magazines, Google and living in a 24/7 world

Magazine Publishers of America has announced that they are partnering with Google to host “Magazines 24/7: Google Day NY”. Here are details from the MPA blog:

Google team leaders will discuss digital strategies for magazine publishers to improve websites and build audiences. Topics include: how to maximize revenue with your website; growing your digital audience; and new opportunities for selling subscriptions online. We’ll announce more specifics on the May 14 event in the coming weeks, but it’s free to the first 200 people from MPA-member companies who sign up for the March 3 “Magazines 24/7” conference.

This event is a companion to the MPA conference being held in New York at the same time.  The is considerable work being done within US magazine publishing houses to leverage online opportunities.  Newsagents risk finding out about this activity and impact late in the day.  This is another reason we need flexible shopfits.

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magazine distribution

Smart ways to grow your newsagency

bne_workshop.JPGThe KICK START YOUR NEWSAGENCY management workshops I am involved with are in full swing. Yesterday in Brisbane we had a good discussion about our all important point of difference and again today in Sydney. It is good to see newsagents so passionate about ways in which they make their business stand out – some have flown into town to participate.  Like all workshops, this one will evolve as I get around the country this week. The details for Canberra, Adelaide and Perth, the remaining locations in this initial cycle are:

  • Canberra. Wednesday Feb. 11 at 6pm. Rydges Capital Hill. Cnr Canberra Ave & National Cct Forrest. Undercover Parking Available.
  • Adelaide. Thursday Feb. 12 at 10am. Rydges Southpark. 1 South Terrace Adelaide. Parking Available.
  • Perth. Friday Feb. 13 at 10am. Holiday Inn.  Burswood.  Parking Available.

    • If you would like to come and join the conversation about growing newsagencies feel free to drop in.

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    Newsagency management

    Newsagency closes and helps other newsagents

    dsc06234.JPGThe newsagency I have written about a couple of times (here and here) when they closed for lunch and closed for a week has closed for good.  While it’s disappointing to see a newsagency close, it is good to see a sub standard operator get out of the business and therefore stop pulling the rest of us down.  I was a regular in this shop and it frustrated me to see empty shelves and to experience mediocre customer service.  Some Victorians will recognise the shingle – the Logo brand was local to Victoria years ago but has not been in use since the mid 1990s.

    The presentation of this newsagency over the last couple of years was one reason I wrote here that the shingle newsagency is of little use any more.  Why would I want my newsagency to be considered part of a retail network with businesses like this?  This is why other retail brands in our channel are getting stronger and why, I suspect, they will refer to themselves less as newsagents and more just by their brand name.

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    newsagency marketing

    Publishers miss out by not letting newsagents choose magazines

    frank_green_power.JPGFollowing some discussion here, I have been taking more notice of titles I get in one newsagency and not another.  Take Green Power Today.  Had I known this was available I might have put my hand up to give it a go because I like the idea of an environmental segment.   Gotch is good at letting us know about new titles.  The other two magazine distributors are not so good.  Maybe more visibility of what is available would see newsagents being proactive at building segments and categories or magazines.  The challenge with that approach that it would need to come with the ability to more easily remove (permanently) titles from distribution and there is the problem for the distributors.

    As for Green Power Today, while I would have liked to try the title, please don’t send it NDD.

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    magazine distribution
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