While it is funny going back to three magazine deliveries this week, I don’t see it being that disruptive in that those of us getting magazines on Friday won’t have to label them. The biggest challenge I can see will be for newsagents with sub agents. The sales opportunity is what I’m more interested in. I am keen to see what this baby can do for us. This is why we will be going out hard in my newsagencies.
Our sales for The Block one-stot are slower this year than last yet our promotion has been as engaged. We’ve had the title at the front of the store facing into the mall, with home improvement titles and next to newspapers. With the show still on air we continue to support the magazine but are preparing to withdraw and use the space for other titles.
Check out the latest TV commercial from respected powertools brand Stihl. Watch the whole ad and hear them say their products are not available at Bunnings and Masters. It’s great to hear a respected brand say they don;t deal with these retailers who focus on cheap products.
I’d love some of our suppliers to promote that their products are not in mass merchants who disrespect them.
I called on News Limited to help address a supply issue and they responded quickly and professionally. Their help has been excellent because they want what we want – more sales. I mention it here to publicly praise the circulation team at the Herald and Weekly Times. As a retail newsagent it’s terrific they respond to our calls for help.
The latest issue of Melbourne Wedding & Bride is the thickest I can recall. The photo shows the magazine with a copy of Better Homes & Gardens behind it. This shows that in the space Wedding & Bride takes I could fit five or six copies of Better Homes & Gardens.
The size of Melbourne Wedding & Bride imposes handling and merchandising costs for newsagents that are greater than we have for the average magazine. It’s for this reason that I think we need to have a commercial discussion with the publisher about compensation. A magazine distributor reasonably representing its retail partners would have already done this.
Melbourne Wedding & Bride is packed with advertising. I’d expect ad rates to have increased over the years, to certainly cover the cost of the larger publication. The fixed cover price and low gross profit of 25% leaves us worse off with the larger magazine today.
I’d like to see a size trigger set for magazines. Titles thicker than a centimetre, for example, should have a retailer surcharge that is fully passed on to newsagents. While not wanting to complicate things, I’d like the surcharge to apply based on time on the shelf to more accurately compensate the retailer for engaging their assets. This would be reasonably easy to organise.
I like Melbourne Wedding & Bride, it’s a good magazine that sells well over the on-sale period. That it is in a size category of its own is what puts it on my radar today.
We’re giving the iPad for Kids magbook time in the spotlight since we have parents and teachers shopping with. With the use of iPads growing in schools this is a easy title for us to pitch.
Maybe it’s just us – our supply of Scientific American Mind was ramped up by more than double on the back of a low sell through at the old number. More time wasted on poor magazine distribution decisions.
The Australian Women’s Weekly is the first Australian magazine I’ve heard of announcing a response to the royal baby news. They will have a special wrap-around for the next issue, on sale next week. It will be interesting to see what we get Thursday.
Last year when newsagents were encouraged to order Darrell Lea Dad’s Bags for sale in the lead up to Father’s Day this year they were told Australia Post would have the products including in corporate stores. What they were not told is that Australia Post would promote the Dad’s Bags on the front cover of their August catalogue.
I am certain there are newsagents will be shocked to discover the government is competing with them for what is an important retail season.
Why is this government protected post office monopoly selling Darrell Lea confectionery products including the Dad’s Bags? These are post shops. They should be selling stamps and packaging specifically for posting. That’s what they exist for. Darrell Lea products are outside the scope of what is allowed in the Act under which Australia Post operates in my view.
Every Dad’s Bag sold in a government owned post office is one less sale for a nearby small business newsagent. It would also be one more attack on small business by politicians of all sides who prefer to protect Australia Post than deliver on their claimed support for small business and competition.
Shame of Darrell Lea for dealing with the government owned monopoly. Shame on every politician who supports Australia Post competing with newsagents and other retailers through their corporate stores.
I’d like to see Australia Post corporate stores more tightly controlled in what they can sell – no cards, gifts, picnic sets, sewing machines, books, stationery or Darrell Lea
In another show of support by a government for Australian businesses, the State Government in Queensland has contracted US giant Staples to distribute the state’s learn to drive log book and keys to driving in Queensland. Queensland newsagents now have to buy from Staples thanks to the state government.
GNS offers a perfect distribution channel for both publications given that newsagents are the go to retailers for these. GNS is Australian owned.
Politicians making these decisions to give US companies ahead of Australian businesses need to be held to account. Even if using an Australian business costs a little more the economic benefit is greater for the country and the state if they appoint an Australian supplier. Sadly they will not realise the damage until its too late.
Further to my piece on Forever Clover last week, we sourced these tins that go with the cards. The result is a Forever Clover will spend more with us.
I note that the Forever Clover cards now come with a sticker labelling them: footy cards for girls. Smart move!
It feels to me like there has been an increase in supply of bagged comics, especially packs at the high end – like this Simpsons pack at a whopping $18.95. The price point is excessive for what shoppers expect to pay in a newsagency and it’s also excessive for this product.
I’d be interested to hear from other newsagents abut whether they feel supply of these types of products has increased for them.
Several newsagents have told me they have been contacted many times by their association encouraging them to consider the new Hubbed service. An email I received from NANA on July 9 reads as an endorsement of Hubbed by the ANF and NANA:
NANA and the ANF would like to invite members to attend one of our information sessions we will be holding at our QLD office in Zillmere.
These sessions will provide you with the opportunity to learn all about the new CONNECT system which is now being offered to member Newsagents nationwide.
This is a fantastic opportunity for newsagents to see how they could grow their businesses and revolutionise the way that consumers transact in retail environments.
We have shipped a Hubbed CONNECT machine for you to touch, feel and experience.
The email included:
There has been a great deal of interest from members in the Hubbed “CONNECT” system for newsagents and the exciting news is that this great opportunity will roll out in QLD starting in August 2013.
As I noted, this email reads as an endorsement. That the information sessions are being held at association offices also suggests endorsement.
Here are questions I’d want answered before contemplating Hubbed further:
I was recently at the Tasmanian Newsagent of the Year Awards dinner in my capacity as owner of Tower Systems to present the Retail Newsagent of the Year Award. As an award presented I was given a few minutes too speak at the dinner. I took this to mean two or three minutes. That’s all I and all bar one other award presenter took. The CEO of Hubbed took twenty minutes and launched into a sales pitch. While it was the wrong place and wrong time for this, it gave me an insight into their services.
From what I can tell Hubbed is not offering anything significantly different to what newsagents have FREE access to today through ePay and Touch Networks. My understanding is that Hubbed will cost newsagents $7 a day or $17 a day depending on the level of service they choose. That’s a lot of money compared to the free services available already.
It could be that I am missing something but I don’t see Hubbed as generating considerable new traffic. It’s an agency service and newsagents make money by providing services at the counter. Retail is moving away from the counter. Newsagents, in today’s retail environment, can make more money on the shop floor by being engaged retailers.
Investing $2,500 (less than $7 a day) in stock of new product lines, a newsagent could expect to make at least $7,500 gross profit over a year based on average stock turn and margin. They would have established their business as a destination business in a new product category and that should see at least some customers returning for additional purchases. Some of the new traffic should also generate revenue from other parts of the newsagency.
My focus on the future is on generating new traffic from new product categories, non agency, non commission product categories. I’m confident I will make more money by exerting control over what I choose to sell and the price I choose to sell it at. Check out the Newsagency of the Future video for more of my thoughts on this.
I don’t know enough about Hubbed to tell newsagents what to do nor is it my place. I have written this post to raise questions, to ensure that newsagents considering signing up for Hubbed are fully informed, more informed than covered in communication from the associations.
Newsagent associations have no place being involved in providing or endorsing any commercial services. They ought to focus 100% on policy and get that right.
Every time an association endorses or promotes in any way a business it has any commercial relationship with it should disclose the interest.
The last service the ANF wholeheartedly endorsed and promoted was Bill Express, in 2003. As newsagents later discovered, the only due diligence undertaken by the ANF related to advice from their lawyers about ANF Director matters and not Bill Express or the Bill Express related contracts. Newsagents lost millions of dollars.
Our Who sales have been excellent from Thursday through the weekend. The interest in the Cory Monteith cover story has been considerable. I noticed the title being purchased by younger than usual customers. We made the most of the opportunity with placement on the lease line and deeper in-store. We need to be opportunistic with stories like this.
We’re promoting Military Vehicles, the new partwork in a couple of locations including with military magazines. We’re not expecting big sales because of the special interest nature. I’d have preferred the launch issue to come out a bit later – close to Father’s Day.
The latest issue of Rolling Stone magazine in the US features a photo of Dzhokhar Tsarnaev, one of the two accused of the recent bombings in Boston. 7-Eleven has removed the title from sale as has national drug store (c-store) chains CVS, Walgreens and some other retailers – see the report in Time for details on this. The Huffington Post report is also worth reading.
You can read the cover story article here.
I am interested in the story from the perspective of a retailer – would I take this issue of Rolling Stone off the shelves? This question is different for an independent retailer compared to a national chain as the stakes for the national chain are higher and the pressure that can be brought to bear through social media far greater.
From what I can tell many complaining about Rolling Stone are more concerned abut the cover photo than the article itself. They say it disrespects the victims of the bombing and glorifies the alleged bomber. Others say it’s not the role of the music magazine to cover the story. The attention the cover is receiving on Twitter and Facebook is extraordinary.
To me, Rolling Stone is demonstrating its relevance as a media outlet by covering this story. I’d go as far as saying that controversial as it may be, the cover makes commercial sense for the magazine. The best news outlets are those that take us places we may otherwise ignore, showing us angles we may not want to see. Democracy will not be well served by us only being fed stories and images we want to see.
Would I have this magazine on my shelves? Yes. Would I have this magazine on my shelves if my business was located in the US? Probably but I’d take on board feedback from customers. I’d not want to get into a position where customers control what I sell as it’s my business and I’m less likely to be successful if I let the tail wag the dog.
Of course I can’t truly say what I’d do if I were in the US as the politics and emotions around the issue of the Boston bombings and terrorism generally cannot be fully understood from this distance.
The photo is from the Rolling Stone website.
Rather than wait to see what happened s a result of the change in magazine delivery days, we introduced a new promotion to attract shoppers. The posters were placed to be seen in the mall, to attract people into our newsagency, to try and break into their destination shopping plans.
This is my newsagency marketing tip today – work with suppliers to unlock offers you can promote to get people into your shop on a day they would not usually visit. Run the offer for a limited time, a time that suits your needs. A secondary tip is: don’t wait to see how a cahnge impacts you – get on the front foot and drive change for yourself.
If you’re not tracking it you’re not managing it. Newsagents who do not track every stock item that enters and leaves their business are more likely to find their business harder to sell. The excuse of I don’t have time doesn’t work as the time involved is not excessive. A newsagency purchase fell over recently because the vendor did not have accurate data including purchase price and, importantly, time in-store.
A newsagency with accurate data is more appealing to buyers.
Kenny’s Cardiology yesterday sent an email to some newsagents encouraging them to rebrand their business as Kenny’s Cardiology as a solution to crisis. I’m not sure how many newsagents were sent the email – I received copies from several newsagents. It was an odd communication to get out of the blue from a company not in direct regular communication with newsagents.
Kenny’s Cardiology is using fear in their brochure by including headlines like BREAKING NEWS: DON’T LOSE YOUR BUSINESS, UNDER THREAT and GOING OUT OF BUSINESS. The brochure claims that the solution to what they label as a crisis is to rebrand as Kenny’s Cardiology.
The brochure also runs some headlines about digital print, lotto moving online, newspaper sales declining and while these things may be true, many newsagents are responding to these challenges by embracing them as opportunities for change.
I wonder if one motivation for the Kenny’s promotion to newsagents is that there are some newsagents doing well in the gift space Kenny’s has occupied for many years. I don’t include cards there since newsagents sell more cards than any other channel. It’s possible that newsagents who have moved into the gift space have taken sales from Kenny’s. If that’s the case this campaign from Kenny’s could be their way of fighting back, addressing, maybe and I am only speculating here, a crisis for them or some of their branded stores.
Think about it, newsagents account for considerably more gift sales today that even three or four years ago. Some of the gift sales have been won from other retailers, maybe some from Kenny’s stores.
The brochure says that rebranding as Kenny’s Cardiology would give newsagents – the brochure is squarely aimed at newsagents – brand recognition and card and gift credibility. Many newsagents have card and gift credibility today. As I have noted here over the years there are many newsagents doing excellent business with gifts and cards already and achieving great year on year growth.
Newsagents wanting to research Kenny’s can find out more at their website.
Footnote: I am a Director of newsagency marketing group newsXpress. I mention this as the pitch from Kenny’s appears to place them in the newsagency marketing group space, competing with Newspower, nextra, news extra and newsXpress.
The Scooby Do Holiday Hi Jinks ‘magazine’ pack is expensive at $12.95 in my view. Inside the pack are four small booklets. The package is made to look bigger with a large plastic sleeve. It’s not worth $12.95 in my view. We received this in-store after school holidays so it’s late connecting with holidays – too late for me to justify keeping it on the shelves. So, I’ve early returned this title.
The supply of this title is an example of something that only gets to newsagents because of a magazine supply model that does not respect us. We have to give our space and labour for a product that’s late and too expensive. The only way our major competitors would get this title is if they are paid a fee to take it.
One day magazine publishers and distributors will wonder why newsagents are getting out of magazines.
Sales of the Knit & Stitch partwork have been excellent in the first few days on-sale – no thanks to the lack of reasonable supply of marketing collateral and a display unit.
We have Knit & Stitch placed on the lease line, facing into the shopping mall as well as deeper in-store. We’re chasing a sell out by the end of next week – for sales as well as for space reasons.
Here is another newsagency business performance assessment I have completed. This regional high-street business (population 3,200) is in the middle of significant owner driven change, building a higher average GP and basked size. Here’s what I sent the owners…
I have reviewed your business sales and other data for the year to June 30, 2013 and compared it with data for the year prior. I have selected the year on year comparison, as opposed to my usual three month comparison, as it provides a better analysis of the changes you have made to the business.
In your business data I can see that you don’t scan all stationery items with 4,405 items being sold using department keys in one six month period. While this could be cardboard or loose paper, it’s important you check. In my own newsagencies we do not use department keys at all and the result is more useful business data.
Your newsagency is what I’d call traditional in product mix. yes, You are introducing some new products – but you need to do more to keep ahead of the waves of change hitting your business and all newsagencies. Bring on change through your actions and not as a reaction to what is hitting you.
- OVERALL SALES. Total sales fell by 5% in 2012/13 compared to 2011/12. That’s on average 163 sales each week. This decline requires a response from you as business owners – what are you doing inside and outside the business to bring in new traffic?
- OVERALL REVENUE. This is down 3% year on year, meaning you are earning more from each transaction than in a year earlier.
- AVERAGE ITEMS PER SALE. You have 1.734 items per sale. This is a good number, nicely above average for a newsagency in Australia.
- AVERAGE SALE VALUE. Your average sale value of $9.49 is terrific – up 7% on a year earlier. This is what is softening the impact of a small decline in sale transactions.
- CALENDARS. I can see this is your first year with a separate calendar department. $1,362 in sales at 60% gross profit is a good starting point. Your magazine data could guide you in calendar purchasing. I have found magazine sales data to be the best guide in this area.
- CARDS. Your sales are up 4% year on year. The data shows the shift from one card company to another and in this a shift in price point focus. While the 4% increase is good, I’d stay on top of the card relationship by requesting a review to tweak what you have … chasing more growth this year. Your card data can better inform your gift, toy and plush buying. for example, I think you could increase plush sales by 500% on the basis of your card sales.
- GIFTS. While you had gifts the year earlier, your sales result in 2011/12 of $1,312.61 is nothing compared to $15,402.26 this year. As well as increasing revenue from gifts by 537% you have increases your average GP. Based on your card sales I am certain you could grow gifts further this year. I suggest you target $25,000 as your sales target for gifts this year. I am certain you can achieve this. I’d suggest you move toys to their own department for more accurate reporting. Looking at Toys I can see this accounted for most of your 2011/12 gift revenue – making the result in 2012/13 even more stunning. Well done.
- INSTANT SCRATCH TICKETS. With ticket sales down 6% and revenue down 10% you have to look at how you promote these. Are you and your team engaged? Are tickets being offered across the counter? The data indicates the decline is in the lower denomination tickets.
- MAGAZINES. Unit sales down 5% and revenue down 7%. These figures are not bad compared to the newsagency channel average. Whatever you are doing – keep doing it but do more to ensure that you keep the decline in check.
– Women’s Weeklies are only down 3% – an excellent result considering what I see elsewhere. Since they account for 26.72% of your sales the good performance is important to you.
– Your commitment to special interest titles sees them accounting for 12.39% of your magazine sales at around $500 a week. This is important since special interest titles are usually only sold in newsagencies.
– Well done on the 13% year on year growth in teen magazines and 15% in buying and selling.
– I can see from your magazine data that your shoppers are more likely to be women: craft 7.55%, Home & Lifestyle 8.19%, women’s Interests 4.89%, Women’s Weeklies 26.72%, Food 2.59% and Crosswords 4.34%. Are all your women-focused titles in the one area? Is this easily shopped? Could you improve their shopping experience?- NEWSPAPERS. Unit sales are down 7% just below the newsagency channel average. The concern is that this reflects a decline in traffic, a decline you need to replace. The other question re the 37,919 newspaper sales in the year is – what’s next to your top selling newspapers? You ought to have products you want purchased on impulse next to them. For example: better Homes & Gardens Thursday through Sunday, Women’s Weekly the first few days it comes out etc.
- STATIONERY. You dropped $14,500.85 in revenue over they year, a decline of 7%. This is higher than the channel average. What’s interesting in your data is the growth for account books – 25% year on year, Binders – 15%, crepe paper – 25%, Notebooks – 21%. A deeper analysis is challenged because you’re slack in managing your data – you have $11,509 in sales sitting in unknown category. This can be easily fixed to give you accurate data. In terms of stationery overall, connect with your GNS rep and ask for an assessment based on their top selling stationery items in the area. It could be that you have some opportunities here.
- LOTTO SALES. Well done on the 12% increase in sales, this is better than average. What are you doing to encourage and guide your lotto customers into purchasing other items? You had 38,172 transactions in 2012/13 – plenty of opportunity for promoting other parts of your business.
As I noted above, what you have is a reasonably traditional newsagency but I can see transition underway in some areas. I think you need to pick up the pace on this transition, chasing new traffic by expanding your product offering.
I feel for newsagents who sell lottery products as they would have had additional challenges yesterday with Powerball at $30 million and handling the first Thursday delivery of magazines.
I suspect the newsagencies with larger magazine departments will need a few weeks to settle in operationally with the changes. I know we will. There are many factors in addition to getting stock out: promotional displays, processing returns, placement management and setting the shop for the weekend. This is work that was spread over two days with one of those days being regular hours.
It will take a couple of months for us to see any change in traffic caused by the change. That said, magazine sales yesterday were up but Wednesday and Thursday combined were down on what we usually experience across the two days. This will be something to check on in a couple of months.
Here’s how we used the cards provided by Pacific Magazines for promoting the Thursday on sale of Who and That’s Life – with placement under each title. This unit sits on the lease line as a second location for the titles displayed.
I like the poster Bauer provided access to for promoting the change in magazine delivery day and we used it to pitch the change.
I wish publishers helped us present a completely unified message to our customers. We have plenty of other great magazines now on sale Thursday.