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

News Corp. newspaper billing error hits newsagents with an expensive Christmas gift

newscorpbillNews Corp’s Queensland outpost Queensland Newspapers has admitted a billing error affecting newsagents going back, in some cases, eight months. They advised newsagents by email over the weekend and have indicated they will add the amount they are clawing back as a miscellaneous line item in the Dec. 14 bill.

This is appalling behaviour by News Corp. It’s the sort of big business vs. small business story you would read about in a News Corp. tabloid.

I urge newsagents to request News Corp. to provide an itemised accounting of the amount sought, to provide thirty days for verification and to agree that newsagents may take as long paying off any amount they agree to as it took the News Corp. system to allow the amount to build.

News Corp. should also compensate newsagents for the time it will cost to verify their claim. I’d suggest a discount of 25% to the additional amount the company says is owing is fair.

If News was being really fair, however, they would credit the whole amount owing. The goodwill such a move would generate would be well worth it – far better than what they are doing now.

News Corp. is wrong to seek full recovery in one week. There is a useful precedent in how energy companies can recover adjusted amounts owning where there as been a billing error.

Further, it is wrong of News Corp. to publish only a total owing in a short email. The company needs to provide affected newsagents with a full and thorough accounting and them to provide newsagents with reasonable time to verify the claim.

The company appears to have discovered the billing error early in November. Why it has waiting until now to communicate is odd.

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Ethics

Here’s another reason competing on price is a no-win game

Competing on price is not good for business as it is often a race to zero GP and below. The best competition is through a service, product range or some other factor over which you have more control.

Some UK retailers who sell through Amazon and use a service called RepricerExpress discovered Friday that competing on price could close their businesses. repricedExpress automatically drops the price of goods in response to the price of others. It seeks to ensure a retailer remains competitive. There was a glitch last Friday that saw the items of many small and independent online retailers drop to 1p.

Check out The Independent for the story.

On the broader issue of competing on price, the customers you win based solely on a price offer will not be loyal unless you maintain the low price (low GP) offer. Usually, that’s not good for business, especially if it is a big business with a bigger ad budget you’re up against.

I’d rather go the other way – have an offer so compelling that I can charge more and customers will pay happily for the privilege.

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Newsagency challenges

Showing off pens drives impulse purchases in the newsagency

pensWe are showing off what people can do with the white, gold and silver pens at the counter of the newsagency with this simple display of art on a red envelope. Christmas is the perfect time o the year to drive impulse stationery purchases of pens and tape and having these ar the counter displayed in context is the best way to drive sales. This display adds value to plenty of purchases.

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Stationery

Breast education in the newsagency from a nana

breastLook nana I made a breast a young boy called out to his nana in the newsagency on the weekend, wanting her to see what he has made with our display of kinetic sand.

Nana’s response was quick and cheeky – if you think that’s a breast you’ve got a lot to learn. Judging by the look on the grandson’s face there would have been some interesting questions on the way home.

You hear some funny things on the shop floor.

The kinetic sand is especially good at getting people talking. Although, this ‘breast’ is the most risqué of things made with it so far.

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Newsagency management

Throwing away the newspaper

trashpapersI noticed a customer rifling through our stand of the Sunday Herald Sun yesterday. I offered to help. They said they wanted one with a TV guide. Sure enough the copy on the top had the TV guide – as they all do. They paid for the newspaper, walked out of the shop and over to the bin in the mall in front where they retrieved the nTV guide and threw away the rest of the newspaper. I am shocked they would pay so much for the TV guide. Customers can be a mystery.

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Newspapers

Helping magazines be noticed in the newsagency

coversellingWe adjusted the magazines on the back wall yesterday with double facings given to four carefully selected titles.

Inside Cricket is featured because of the David Warner cover – why not given the Adelaide test success?!.

Next is Smith Journal as it continues to be a good read for intelligent blokes.

Then we have Triple J because it’s now an annual and makes a good gift.

Finally is Sneaky as we like this title a lot and want more people to notice it.

Placing the four titles into two pockets in a column like this in the middle of our magazine wall makes them stand out as well as the titles around them. We will leave them allocated like this for a week.

Regularly changing your magazine placement and display form what is usual helps people fine titles the might otherwise miss. It’s a way to drive sales growth.

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magazines

Sunday newsagency management tip: getting rid of a bad employee

I know of a newsagency where a full time employee is dreadful, they are pulling the business down. They are lazy, doing the bare minimum necessary and less than that where they are not being watched. They take no initiative and offer nothing special in the way of customer service. They do not deserve the good pay they are on thanks to an the award. They ought to be sacked.

This business has just over fifteen employees – meaning tougher obligations on the owner in terms of dismissing employees under Australia’s Fair Work legislation.

I’ve been in the business a couple of times recently and it appalls me to see how this lazy selfish employee treats the business that provides them with a good income. I have seen efforts to engage and encourage and each time they have been ignored.

In the US the employee could be sacked without cause. My experience there is that this encourages better engagement by those employees who do not naturally want to do a good job.

We are not in the US, we are in Australia where employees have considerable rights.

One reason employees treat a business and the owner poorly is because they can get away with it. Fixing a situation of a bad employee starts with being clear to the employee their behaviour is unacceptable. This actually starts with a job description. A  good job description outlines the tasks and expectations relating to the role. It is the framework through which you can performance manage an employee to better behaviour or to exit the business – the choice is theirs.

If you have good position descriptions for employees, the next key is to have good communication. This with a good position description could avoid the situation I have seen recently.

This is my management tip today – set yourself up for more effective employee management, have in place position descriptions that lay out your expectations and the measurement points for performance.

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Management tip

Sunday newsagency marketing tip: don’t jump with the crowd

When everyone else is promoting back to school maybe it is a good time for you to promote something else that could be relevant to the season.

If you do promote back to school and jump with the crowd the challenge is being noticed as the market is crowded with similar pitches. As these things go, the business with the biggest budget is the one what people notice,.

Newsagents are not likely to have the biggest budget.

So how do you get noticed in a big season dominated by big businesses with massive advertising budgets?

Jump out of sync. Be the business not swimming with the crowd, the business with a different message, the business with a different offer that gets noticed, the business that engages in a fresh and exciting way.

It could be that you promote something other than back to school while still doing back to school in the business. Or that you run a wonderfully engaging competition that brings more generations into the back to school opportunity. Or that you make your BTS sales about raising funds for a local school and thereby engage families from that school more effectively. Or that you focus on selling to parents who will be free of their kids (finally).

I think we have within our selves in our own newsagency businesses and in different clusters and groups working together the capacity, and creativity to think and promote differently, away from what big business competitors do and non a way that is more engaging and appropriate to our local customers. 

On the idea of the competition: ask your customers to write on one page their own back to school story. Put these on a wall. Invite customers to vote. Make it a gold coin donation to a local school to enter. Done well, this could drive traffic from all ages and the school community. It shows your business as locally concerned and connected compared to the big business that spends more money saying they do good than actually doing good.

Stand out by being different and not jumping with the crowd.

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marketing

Managing Saturday newspapers

satpapersHere’s how we have our newspapers placed right now. I took the photo yesterday. It’s not a display newspaper publishers will like. However, our sales are up so it’s working.

I wanted to post the photo to also call out re The Saturday Paper. It’s outselling The Weekend Australian and the Weekend AFR for us – hence the placement on the shelf with them. As I noted, it’s working, sales are up.

This aisle end display is in the back third of the shop. It’s seen or passed buy 75% of those who enter the business. So it;’s expensive space for us. I am considering moving it in 2015 because of the paltry margin on newspapers.

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Newspapers

Tatts reps are wrong to use newsagency closures as an excuse for expanding retail channels

A newsagent recently told me what their Tatts rep said when challenged by the newsagent about Tatts moving into other retail channels: with so many newsagencies closing we have no choice.

Newsagents who hear this need to not let whoever says it get away with it. Ask for evidence. Ask for a list of newsagencies that have closed and resulted in other retailers being engaged.

Maybe the Tatts rep was sharing a private opinion. Regardless. they were in the business representing Tatts. They should have been more careful with their words.

Tatts needs to own its decision to expand into other retail channels.

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Lotteries

Christmas in the newsagency

kxxmasHere’s the front of one of my shops as it looked two days ago. I am posting the photo here to show what we are using facing into the mall to attract shoppers. What you can see in the photo will be different to what is in place next week – we constantly adjust the message.

This is the shop that is tracking 15% year on year revenue growth and a significant Gross profit realignment away from the traditional newsagency Gross Profit of 28% to 32%.

While there is now reasonable discussion in the newsagency channel about the need to attract new shoppers, there needs to be more discussion about shifting GP from the traditional to a new model.  The better your GP the more you can weather peaks and troughs in traffic flow.

This shop does not have lotteries. It does not have tobacco products.  Newspapers are half way down as are magazines. Newspaper sales are up 13% year on year (units) while magazine sales are up 10% year on year.

Our goal with the shop front is to attract people who wander in for a browse. Thanks to layout and shop floor engagement plenty of these purchase on impulse. We then rely on our loyalty program to bring them back.

Click on the image for a larger version.

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Newsagency management

Selling Clive Palmer

qessayWith Clive Palmer such a large and polarising character in federal politics and business circles, the latest Quarterly Essay is timely – and an opportunity to pitch the title away from its usual location. Put it in the spotlight! I’d suggest newsagents place it with newspapers. Even include a bookmark noting it as an excellent Christmas gift for anyone who loves politics and or who loves Clive.

Written with wit and insight by Guy Rundle, this is a terrific read. I recommend it.

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magazines

It’s an Olaf Christmas

olafOlaf is the character people are loving this Christmas from what I can see. Whether it’s a plush item, a card, collectible POP! Vinyl or some other thing, if it is of Olaf, people love it. While the initial wave was kids who were into the movie, we are now seeing adults purchasing items, especially the collectible lines.

Identifying the multiple shoppers for an item can help you finesse your pitch through placement and through shopper dialogue.

We are making the most of the Olaf opportunity by ensuring we have good stock from a diverse mix of suppliers.

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Newsagency opportunities

Wonderful note from the author of The Drover

I received a wonderful note from Alice mavin, author of The Drover – a coffee table book I strongly recommend newsagents stock

My name is Alice Mabin and I am the author of The Drover. I was at newsXpress Beechworth today and Vaughan showed me the post you put on your newsagency blog.

I just wanted to say a huge thank you for your comments. I see you have a very strong following on the blog and your message really helped with my book sales leading up to Christmas.

It has been a real challenge but rewarding at the same time, to self publish and distribute my own book. The fact that bookshops have not stocked my book has been a bit of a blessing in disguise as it has made me think outside the box to promote and distribute my book and still make it a success.

The newsagents that have got behind it have been wonderful and have even been active in following through with the merchandising ideas I have given them to help with promotion.

Alice is supporting our channel with access to her book, autographed copies and retail support. Newsagents I’ve heard from say it is selling very well. This is a good Aussie story for us to get behind.

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Book retailing

Coles reminder on gift cards

giftcardsA visit to your local Coles is a good reminder about the placement of gift cards this time of the year. In one Coles I was in yesterday they placed gift cards at the main entrance – you could not miss them. This is an excellent reminder to newsagents to check where gift cards are placed – interrupt shopper flow, get them noticed.

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Newsagency opportunities

The best floor display unit of the year

tmstandI rate this Top Model floor display unit from TAG as the BEST floor display unit of 2014.

This stand is strong and well-branded and presents the products well. Better still, it works at driving sales.

We see many floor display units that do not serve our businesses well. This stand is so good we have a second coming to strengthen pour pitch for this very successful young girl brand.

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Newsagency management

Crossword magazine sales up 24% year on year

magscwOur crossword sales are up 20% comparing the last eight weeks with the same eight weeks a year earlier. This is extraordinary growth outside what is average for the newsagency channel.

My research suggests that the average year on year growth for crosswords in 2.5%.

I’d put our growth down to moving the category to a better vertically integrated fixture and our discount voucher loyalty program. The discount voucher basket data in fact shows extraordinary use of the vouchers for crossword titles.

Newsagents can grow crossword magazine sales through more proactive shop floor engagement and a genuinely rewarding loyalty program.

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crosswords

Extra early returns for Christmas

xtrareturnsI broke with tradition and did an additional sweep for early magazine returns yesterday, Thursday, because of space pressures as a result of unwarranted additional magazine supply and Christmas space pressures.

Outside of our usual magazine returns and a reasonable first pass at early returns, this  photo shows the additional early returns I pulled out of a desire to exert more control over my business yesterday.

The planned MPA magazine publisher  distributor code of conduct will not adequately address the oversupply situation nor will it address the uncompetitive nature of how magazines are supplied to newsagents versus our competitors. Until this is fixed, early returns are the only tool newsagents can use.

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magazine distribution

Making a splash for Dolly

dolly5I found room yesterday to display all five covers of Dolly for the next week at least. The covers look terrific placed next to each other.

We’re fortunate to have fixtures that make eye level full cover display achievable in the magazine department.

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magazines

How to grow Diabetic Living sales

dbtlI’ve found the best way to grow Diabetic Living sales is to place it with health titles plus weeklies and or food titles. It’s a magazine often purchased on impulse – hence the importance of location. This week we have it with That’s Life as it always does well from there.

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magazines

Promoting Frankie for impulse purchases

frankieWe are promoting the latest Frankie magazine with a half waterfall as well as an off location placement with a range of stationery we have for the Frankie shopper.

Having the full cover of Frankie on show to drives impulse purchases.

This bumper issue of Frankie looks stunning.

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magazines

Here’s how PayPal payments work in a newsagency

I was asked here a while back to show how PayPal payments work in a newsagency. This video shows the process – how a PayPal customer can pay thanks to newsagency software integration.

The real value of PayPal is that PayPal shoppers can find your business. This integration is as much about newsagency marketing as it is about streamlining shopper payments.

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Newsagency management

WH Smith impact on Australian suppliers and newsagents

As WH Smith extends its reach here in Australia, acquiring more retail locations through acquisition, some suppliers will see business impacted. New commercial partners will benefit while those who are not will not benefit.

I’ve heard of a supplier relationship that advantages one supplier over a competitor in an important specific channel. The supplier who missed out stands to lose significant revenue as a result.

A bigger group making decisions like this can have an impact on supplier businesses. The flow-on effect could be beyond direct WH Smith relationships.

This is another aspect to consider of the changes we are seeing in our channel here in Australia this year.

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Newsagency challenges

Magazine publishers need to be careful who they listen to

At a recent publishing event someone claiming to know was putting it about that newsagents were achieving a sell through rate of 50% for magazines.

The person reportedly saying this does not have access to data to backup the claim. I think it is their best guess. But they did not qualify it.

I see real sell through data for many newsagencies. While there are some with an overall sell through above 50%, there are many below. But this high level measure is unhelpful. The best measure is non weekly sell through as this is where newsagents are hurt the most.

Once I take out high volume weekly titles, the average magazine sell through I see for newsagents is close to 40%. That is, 60% of this stock fails to sell and is either recycled through the system at the newsagent’s expense or thrown out and wasted.

The MPA driven magazine code of conduct that is at the basis of a supply model trial with selected newsagents will not address this as the code does not go far enough. Replacing a failing title with another failing title allows a distributor to pass the code but fail the newsagent.

I want magazines I can sell. I’m happy for a 75% sell through – less than that does not work for me or the publishers I serve. The problem is that 75% does not work for the magazine distributors. hence the uncompetitive supply model forced on newsagents.

Yes, I hear you …  blah blah blah – nothing new here. That’s true. But I feel better for writing it.

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magazine distribution

Gordon & Gotch magazine fail #3

image[5] copyYep, the same newsagency as the last two, this time it’s TAN UNRESTRICTED. With no sales achieved from issue 54 through to issue 64, the Gotch magazine allocations experts have decided the newsagent needs to go from five copies to eight copies. This would be laughable if it was not so harmful to the business.

And you wonder why newsagents are getting out of magazines.

5 likes
magazine distribution
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