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Pacific Magazines promotion requires a trip to Woolworths for redemption

Pacific Magazines this afternoon announced that free Baby Wildlife Aussie Animal Cards will be available to New Idea readers by way of a coupon in next week’s issue. Customers will need to take the coupon to Woolworths to redeem the free cards.

This is a marketing promotion developed by Woolworths and Taronga Park Zoo. The cards are available with a $20 spend at Woolworths.  The cards are also available by redeeming the coupon in next week’s New Idea. No additional purchase at Woolworths is required with the New Idea coupon – this means customers can redeem from the service counter.

While this promotion is likely to drive Woolworths sales to get to the the $20 spend and New Idea sales for the coupon, that access to the gift is only available from Woolworths is disappointing for newsagents selling the magazine.

Pacific people will say that they could have run the coupon only in Woolworths copies – driving sales in their stores. Sure enough, the coupon is in all copies of the magazine, even those going to Coles. However, that a customer buying from me has to go to Woolworths to get the gift is galling. Some newsagent customers will not like this.

The marketing people in Pacific who agreed to participate in the Woolworths / Taronga driven promotion ought to realise that even the smallest action against small business newsagents hurts considerably more because of the actions of other suppliers against us. Just about every few days we hear of another supplier hurting us in some way. To these marketing people I would say – talk to newsagents and talk to the newsagent experts in Pacific next time you consider a campaign that makes us look like second-class citizens compared to supermarkets.

The last thing any publisher wants is where the majority of magazines are sold in supermarkets. That would be a painful world for you.

We are the single largest magazine retail channel in Australia.  Many of us treat magazines with respect and actively engage with the category. Actions like this campaign will make some of us wonder. We deserve more respect. We regularly do redemptions

Footnote: My understanding is that Woolworths will not have the cards available until the middle of the week so that will present some challenges for them.

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magazines

Hubbed take up slow?

I have heard from several people in the channel that the take up of the Hubbed bill payment agency has been slow and that people in and supporting Hubbed are wondering why this could be the case.

While I have had no discussions with Hubbed, from what I have seen of their documentation I can see two reasons why take up among newsagents would be slow:

  1. Agency versus retailer. More and more newsagents prefer top be retailers, controlling more of their business, the traffic generators and the gross profit they make. The success of Hubbed depends on Hubbed to generate interest and to provide a time and space efficient platform. Retailers comparing Hubbed to the Australia Post offering will see, as I have seen, that the Australia Post kiosk offering is next generation efficient while the Hubbed technology is out of date.
  2. Overall financial risk. Given the need to take a lease for computer equipment for the Hubbed premium offering and that the cost of the hardware included in the lease appears to be higher than one could buy equivalent gear on the street and that the finance agreement is separate to the Hubbed agreement, newsagents are naturally wary.

A newsagent turning over $50,000 in cards could invest the amount Hubbed is asking for into a carefully selected new retail product category and turn the (approx.) $2,500 or $6,200 a year into $10,000 or $30,000 in gross profit respectively. This goes to the heart of the retailer versus agent question.

My personal view is that retail newsagents have a brighter future focussing on being retailers than they have focussing on being agents.

No supplier will make us successful. Our success comes from our own decisions and actions as retailers.

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Hubbed

Newsagents tweeting about appalling treatment of our channel by Optus

optus-tweetSeveral newsagents have taken to Twitter this week to complain about the 25% margin cut being applied by Optus against small business newsagents. The more tweets the better for our campaign to get the telco giant to take notice.

it’s great to see newsagents engaged in a campaign like this. It’s disappointing, however, that newsagent associations have not hit social media to complain about the pay cut being meted out against us by Optus.

I am planning more tweets as I live in hope that one day Optus will realise that our channel is important to them and deserves better treatment.

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phone recharge

Bauer cookbook collateral does not work in traditional magazine fixtures

bauer-buy2The photo shows the placement of the latest small-format cookbook offer from Bauer. If newsagents do what Bauer ask they cover-up most of the titles in the waterfall display. Whoever is responsible for this promotion and the associated collateral ought to spend more time in newsagencies. Besides the product size not being magazine fixture friendly, supplying full-size backing sheets clearly does not work.

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magazines

good chef bad chef issue 2 looks terrific

001_GCBC2_MidResI’ve been fortunate to see a copy of good chef bad chef 2 that comes out in newsagencies on Monday. This is an excellent title that connects with the popular TV show.  It will be promoted on the TV show, their facebook page (19,000+ fans) and elsewhere.

One newsagent sold close to 40 copies of the first issue. They did this by featuring the magazine, supporting it with excellent positioning. The title is a well-known brand.

We plan to place this title with newspapers and weekly magazines in my stores. People will purchase it on impulse – for themselves and as a gift.

Since it is coming out early in the month there is no reason to early return.

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magazines

Some customers trash cards

card-damageI got a severe tongue-lashing from a customer last weekend in response to a request that they take more care when browsing our greeting card range. This lady, in her eighties I am guessing, was quickly and aggressively pulling down on cards –  further than the example I have in the photo I took after. She wasn’t reading them.  She damaged three of our cards in what appeared to be a time-passing random act.

My approach was gentle, could you please not fold the cards forward like you are as it’s damaging them. I pulled a card out and showed here. I’ll do what I like sonny was the response delivered with a finger stabbing at my face. She pulled down a couple more while glaring at me and then left. I felt like sending her to the corner for some time out. She behaved like a brat.

What’s odd is that I don’t think she was looking to buy a card. It looked to me like she was folding the cards down because she could, like it was a game.

While this situation is not uncommon, we see it more at Christmas-time when all sets of crazy behaviour is on show.

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Greeting Cards

Expanded gift range – odd teapots

teapotCheck out one of the odd teapots we’re trying out as part of an expanded gift range appealing to tea drinkers and those who buy gifts for tea drinkers. This is not something I’d have expected to see in a newsagency a few years ago. Today it’s not so unusual as we seek to expand our gift sales further – taking more revenue from the traditional gift shop.

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Gifts

Best practice magazine fixtures

best-practice-magazineOf all the new magazine fixtures I have seen installed in newsagencies and other retailers in recent years this fixture is, in my view, the best for a free-standing shop floor magazine fixture.

The fixtures – the backing frame and the three clip-in shelf units are space efficient, easily shopped. The shelves display more full covers. The deep pockets also work for displaying more titles with half a cover on show as I wrote about yesterday.

In a new shop I’m an owner of that opened this time last year, this fixture holds half of our magazine department.

Using a clip-in clip-out system, this fixture from Caem is what I’d consider to be best-practice for displaying magazines on the floor newsagencies. I don’t have any arrangement with Caem, they don’t know I’m blogging abut this today.

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Newsagency management

Katie Couric joining Yahoo is a world-changing moment

The announcement that Katie Couric will anchor a news program for Yahoo is a marker of significant change to how, when and where we access news, information and entertainment. That Yahoo is able to attract a star of Couric’s stature speaks to the extent of the changes we are experiencing. This is media disruption!

This move is about much more than the disruption of print by websites that we all talked about years ago. The changes occurring now are about breaking down the mega-channels of old media by disruptive mobile and related businesses. It’s not so much about whether people will switch from TV to Yahoo to watch Couric as it is about those already in the spas-pit in which Yahoo plays who will engage more because of Couric.

Mobile is the medium of the moment for news, information, entertainment and shopping. All of us need to understand the scope of what is happening here. The Couric announcement is a marker of the scope of change. The House of Cards TV show starring Kevin Spacey is another example of the shift.

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Media disruption

Negotiating a high street lease with the landlord

I have recently negotiated a lease extension with the landlord for a high street retail business I own and share the story here.

I nominated that I wanted to take up the extension permitted in the current lease. This triggered a market review opportunity for them which they embraced. The landlord engaged a single local real estate agent who came back arguing for a 10% increase with little hard evidence.  The double-digit rental increase was put to us by the solicitor for the landlord.

With the solicitor being difficult to deal with, I went back to the landlord explaining that I felt a fairer increase would be 5%. I explained that I had the option to reject their proposed increase through a more formal channel but would prefer to negotiate a middle-ground solution both parties could live with. I refused their argument of evidence form one real estate agent as being sufficient and reinforced that we had always paid on time and have been good tenants.

I was certain that QCAT would reject the landlord’s use of a single real estate agent and that the letter from the real estate agent did not, of itself, represent a fair market review.

After a couple of weeks consideration of my middle-ground proposal and several emails from me restating my case, the landlord agreed to the proposal of a 5% increase. While no increase can be considered to be good, it works in this situation. The business is tracking well and can digest the increase with much of what we sell not being fixed-price. Our approach is to chase more traffic, get existing traffic buying more and increasing our margin on all items through small steps on price.

I wanted to write about this today to encourage newsagents facing lease negotiations to be fair in their discussions with landlords, to always copy the landlord on any letter to their solicitor and to be clear in understanding what your next steps could be if you were to take a more formal dispute resolution approach.

While having a landlord who is committed to fairness is important, I think we can facilitate this in our approach to them when negotiating. They are entitled to ask for whatever increase they like. It’s where we end up that matters most.  Where we end up often depends on how we approach the negotiation.

Negotiating a lease with a high street landlord is completely different to negotiating with a shopping centre landlord.

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Newsagency challenges

Making room for magazines

mags-spaceefficiencyWith more and more lower volume magazine segments we are overlapping titles to drive space use efficiency. Fitting three and four titles where we would usually fit three helps us reduce the retail space costs of these titles thereby enabling us to offer range for a longer period of time.

I’ve been in this business long enough to recall the push by Daryl Fedden of Gordon and Gotch for us to go with full face display of magazines. retail space costing what it does and magazine sales being what they are we will see more newsagents overlap covers to be able to offer the range in less space.

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magazines

Displaying Christmas bags and cards

christmascardsxI love the placement of Christmas bags above the single Christmas cards in one of my newsagencies by the creative in-store team. In addition to efficient use of space, this placement provide a stronger Christmas pitch above cards and thereby makes them more noticeable. Click on the image.

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giftwrap

Excellent sales of named Christmas decorations

jacmanxmasThese Christmas decorations form Jacman which light up and have a name on each have been selling exceptionally well. We’ve had customers buying four and five at a time. We have used them on the lease line to attract shoppers. What’s interesting is that cheap and nasty discount retailers nearby have similar looking but inferior product. We’re getting the sales because we have a better value proposition.

These cheap and nasty discount shops are tending more and more to copy us for product. try as they might, they can’t and won’t match quality and ultimately it is quality the shoppers you want actually want for themselves. So I say to the copycats, copy all you like. You’ll ultimately fail.

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Gifts

The cost of being in a shopping centre

I’ve encountered two expensive and frustrating shopping centre landlord situations recently:

  1. The imposition of a post box fee – it now costs $50 to have a post box where mail is delivered. This is the box we’d always used. It’s in a location where it’s always been. It’s a location they can’t make other money off.
  2. The mandatory change to power provider. They say it will be cheaper. By the time we pay their mandatory supply fee and then for our usage our power bill will go up by $200 a month. This is nothing to do with the carbon tax, merely a money grab from someone, probably in part the landlord.

I mention this to show that while shopping centres are magnets for valuable traffic, this comes at an every changing cost.

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Newsagency management

Newsagents should get angry at Optus over 25% pay cut

Newsagents should read the financial performance report from SingTel and consider this in the light of the 25% pay cut Optus has hit us with.

I think Optus is targeting small business retailers because they expect we will live with the cut and not do anything about it.

The only way to deal with this is for us to hunt the company down at every opportunity and challenge them as to why they have cut commission from 4% to 3%. We should demand a reason why given that their profit has only fallen .2%.

Go on Twitter and tweet using their @Optus. Get to their Facebook page and ask why they are hurting small businesses like ours. get your customers engaged too. The more public we complain the more attention we will get form the company.

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Ethics

Shop Til You Drop / Sun Herald promotion

shoptilBauer and Fairfax were scrambling last week to sort out the mechanics of an offer promoting Shop Til You Drop and the Sun Herald newspaper – the bundle is priced at $5. Key stakeholders had not been informed and had to work through processes to ensure that the offer could run as proposed.

The sooner publishers engage with all stakeholders the more prepared everyone involved can be for promotions such as this one.

Better preparation can reduce stress and streamline the process for newsagents and their customers. Doing this at the last minute can lead to a promotion failing. One day publishers will learn.

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magazines

Symply Too Good To Be True 7 selling well

magssymplyWe’ve achieved a sell-through of more than 85% of Symply Too Good To Be True 7, justifying the decision to NOT rely return the new title in the very successful range. I know one newsagent who early returned all copies – they will have missed out on certain sales given how this issue has sold. This range will sell well through Christmas, always does.

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magazines

Promoting One handed Cooks

magsonehandedcooksI’m thrilled we were able to get stock of the launch issue of One Handed Cooks magazine. This is a very cool magazine, a nice addition to our food title section, a section we’re particularly proud of. One Handed Cooks magazine is being promoted on social media and newsagents are benefiting.

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magazines

Promoting Christmas issue of AWW

magsawwWe’re promoting the Christmas issues of The Australian Women’s Weekly with prime placement next to our top selling magazine. We are also supporting the title with a second location placement to attract impulse purchases and will maintain this for another few days.

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magazines

Watch out for AWW TV show bump

Newsagents should watch out for opportunities flowing from Summer with The Australian Women’s Weekly airing on TV on December 1 and Christmas with The Australian Women’s Weekly airing a week later. These now annual shows are always good at promoting the magazine.  TV Tonight has more on the shows.

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magazines

Optus CEO should address the 25% commission cut about to hit newsagents

Fairfax media on the weekend reported candid comments from Optus CEO Kevin Russell about overcharging and what the company has done to improve the customer experience. Russell’s comments are uncommonly open for a telco CEO.

“Let’s be crystal clear. As an industry, we know how people use their phones, we know that young people will get their first smartphone and go bananas on it, we know people are going to get hit with a $500 or $600 bill, and we know that if they don’t complain we’ll get an extra whopping bit of revenue,” Mr Russell said on Thursday night. “It’s just crap.”

But he said he honestly believed Optus had been doing a number of good things to address “some of the things that piss people off”, such as bill shock.

I wonder if Kevin Russell would be as forthcoming in talking about his company’s soon to hit 25% cut in commission for small business newsagents.

The Optus commission newsagents earn for selling Optus mobile phone recharge product is set to drop from 4% to 3%. The company has not disclosed commission and commission movement for supermarkets and others selling its recharge product.

With SingTel (Optus’ parent company) profit down .2% YOY there appears to be no financial justification for hitting small business newsagents with a 25% cut in commission. Kevin Russell should be held to account for the decision by the company to hit small businesses in this way.

The company’s fairer approach to its customers should be reflected in its dealings with its small business partners – if it’s serious about being a better corporate citizen.

3% commission on Optus mobile recharge equates to 90 cents for a transaction that would take, on average, two minutes – by the time the shopper pays. The 90 cents does not even cover the hourly cost for retail staff on a Sunday and barely covers it for weekdays.

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Customer Service

Explaining the Peppa Pig phenomenon

peppahotHot Peppa screamed the above-the-masthead headline on The Saturday Age on Saturday. They’re right. Peppa Pig is hot. Our sales of Peppa Pig plush, magazines, activity packs and other items are excellent. It’s a brand we use to pull traffic from the mall outside our shop and it works! The article in The Saturday Age is essential reading for anyone selling Peppa Pig products.

plushwallnowallWe’ve been selling Peppa Pig products since their release and get excellent word-of-mouth traffic.

This photo shows how we place the Peppa Pig display unit on the lease line with two other plush display units. Each is sign-posted to connect with shoppers who know and love the brands.

These stands work best when full!

This is a brand through which newsagents can expand their offering and drive a better overall gross profit for the business. It all starts with understanding the opportunity.

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Gifts

Make sure Empire magazine is on show

magsanchorman2With the stars of Anchorman 2 getting excellent TV coverage here today the timing is right to have the latest issue of Empire magazine placed with your weekly magazines or at the sales counter. This movie will be top of mind because of the publicity blitz. If we’re proactive we can expect to achieve impulse purchases of this issue of Empire.

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magazines
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