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

News Limited favours new retailers over newsagents in its Valentine’s Day promotion

News Limited has emailed newsagents in NSW, asking them to promote the Valentine’s Day edition of The Daily Telegraph to other retailers on terms not available to retail newsagents.

This move disadvantages retail newsagents. It is a disrespectful move by News because of the trading terms advantage given to these other retailers and by chasing sales outside the well-established and loyal newsagency channel.

In this year of extraordinary change driven by News and their T2020 project, they should be more sensitive toward newsagents than ever. This move goes against the spirit of support for newsagents the company has been espousing when promoting T2020.

Here is the email from News:

VALENTINE’S DAY DAILY TELEGRAPH OFFER

Attached is a Valentine’s Day Daily Telegraph offer to help you increase sales on the day.

Valentine’s Day falls on a Thursday this year.

Please approach all florists, restaurants or any small businesses in your area that would be interested in taking up the offer:

 50-99 x The Daily Telegraph @ $0.75 per unit (cost saving 37%)

 100-199 x The Daily Telegraph @ $0.65 per unit (cost saving 46%)

 200+ x The Daily Telegraph @ $0.50 per unit (cost saving 58%)

If you would like me to print off any flyers for you, just let me know. All orders need to sent back before Feb 6th.

Several newsagents who have contacted me have expressed their disgust at this move.

It’s an issue newsagents might consider taking to the ACCC. While the ACCC will question the consumer impact, newsagents could explain that it is moves like this that make newsagencies less profitable and could add to the closure of businesses. It would also be reasonable to question why a florist should get up to 58% GP when a retail newsagent will get anything from 12.5% to 25%. We could also argue that this is an abuse of market power by News.

If News Limited wants retail newsagents to support its products it ought to urgently reconsider this Valentine’s Day promotion. Either it gives retail newsagents the same terms or it withdraws the offer to florists and others.

News Limited needs to prove to us that its words of support for newsagents in 2012, through its T2020 presentations, were real and that we can trust the company.

18 likes
Ethics

T2020 driving newsagent management decisions

As I talk with newsagents about their October – December sales as part of the latest newsagency sales benchmark study, T2020 is often raised as a driver of change in the business. Newsagents tell me that they are making changes to their shop because of T2020 and the effective break up of the traditional multi layered newsagency business.

This is a good thing, newsagents making conscious business decisions. While I understand the pressure many are feeling as a result of T2020, the motivation to look at the business and to plan for change can only be considered to be good.

Some newsagents are embracing the retail only opportunity with gusto, some are tinkering at the edges and some are waiting.

When you consider the challenges and opportunity in retail this is not a time to wait. Outside of T2020, we retailers need to innovate in terms of products and service. We need to prove our relevance in every transaction. Too much of what we sell, even those of us with diversified products, is available elsewhere.

In the early review of the benchmark data I am seeing some terrific success for newsagents who are innovating.  Most growth is in gifts but the term gifts is not appropriate given that this can and does cover a myriad of product categories.  As newsagents evolve as retailers it will be interesting to see how far we push into gifts.

In the meantime, T2020 remains an excellent opportunity for newsagents, to take it as encouragement and motivation for significant change in 2013 no matter which course you decide on.

5 likes
Newsagency benchmark

Appreciating the history of newspapers with an eye to the future

I was in the offices of the West Australian just before Christmas and appreciated seeing this relic from a bygone era. It was terrific to see the display, a wonderful reminder of the history not only of the West Australian but newspapers more generally.

Going through photos yesterday I was reminded of the display. It got me thinking about the history of newspapers and, in turn, the history of newsagents and newsagency businesses.

While we are in the middle of a tornado of change in and around our businesses, we need to connect with history through the change, to bring our customers with us. This is a massive challenge as there is the economic imperative of future relevance yet the emotional connection of a rich past.

There is the business we want to be and to be known for, the business we are known for today and the business we will be able to sell in the future. All three rely on customers who are prepared to spend money.

Back when the machine in the photo was in use we were agents, the final step on a tightly managed conveyor belt. Today, we are not agents. Today, our future is 100% up to us. We have many decisions, large and small, to make. Whereas in the past these would have been made for us, today, we have to decide our future, and out connection with the past, for ourselves.

T2020 is the nudge many newsagents needed / need. It is loaded with opportunities. Embracing them and finding our own way will dilute the newsagency channel and maky many businesses stronger at the same time.

4 likes
newsagency of the future

Smart use of bookmarks to promote magazines

I like the bookmarks being used by Bauer in the current issues of Good Health and women’s fitness as they are a smart way to promote the issue.

That said, I would not like to see the bookmarks overused. They partially cover the magazine behind and this is not fair on that title. Look at women’s fitness – the main cover headline shows as Your … the key message is covered.

Occasionally the bookmarks would be okay but not every issue.

1 likes
magazines

PMP shares fall 25% in six weeks

A check of the share price chart for PMP, parent of magazine distributor Gordon and Gotch, shows shows a decline of 25% in six weeks.  Various restructures over the last couple of years have failed to arrest the share price. It can only be a matter of time before shareholders demand another approach.

I’d love to see Fairfax acquire the magazine distribution business from PMP and to bring to the Gotch titles the control I have today over IPS titles. Yes, I know others have complained here about IPS.  I see it working. Yes I have to commit to new titles for a while – but I get absolute control over what I sign on for and the quantity. They also promote my business through a terrific website.

Of course, fairfax will not buy the Gotch business given what they have said recently about acquisition plans.

2 likes
magazine distribution

New advocacy opportunity for newsagents

The establishment of the Small Business Commissioner office by the federal government provides newsagents with another place where we could seek to have disputes, such as magazine distribution disputes, resolved. The website is clear on the role:

The role of the Australian Small Business Commissioner is to provide advocacy and representation of small business interests and concerns to the Australian Government, including referral to business-to-business dispute resolution services.

I think this provides us with an opportunity for advocacy around issues affecting newsagents as small business owners, particularly in areas where we are treated differently to competitors as is the case in magazine distribution.

As a channel we have failed to adequately explain to successive governments, state and federal, the disadvantage to us, and to our customers, of the current magazine distribution arrangements.

I urge newsagents to remember this new small business commissioner office when next contemplating a course of action on a business challenge. If they can;t directly help – because of state versus federal jurisdiction – they should be able to point you in the right direction.

To those who may say this new office is not what small business needs, it is better than not having such an office at all. It’s a promise kept.

12 likes
magazine distribution

TECHLife magazine oversupplied

With a sell through hovering at 60%, I was surprised that Bauer (formerly ACP) decided we needed more stock of TechLife magazine. Our supply was bumped up by one copy. Okay,not much … but there is no justification in the sales data.

Every extra copy supplied to us above what we can reasonably sell makes us less competitive.

I suspect that most of our competitors – supermarkets and some others – do not have the same financial risk with oversupply that we face. If I am right it makes even one extra copy being sent to us appalling behaviour.

Bauer demands payment on time for a level of indebtedness over which we have too little control.

I’m committed to making progress on this issue in 2013.

5 likes
magazine distribution

Featuring Mollie Makes

We are featuring the latest issue of Mollie Makes magazine at the front of our craft section. We are still growing sales, chasing our capacity for this title. I suspect we are barely half way there based on interest expressed after we sell out.

Mollie Makes magazine is the ultimate special interest title. My experience is that it generates new traffic for us as shoppers come in to purchase the title having been recommended by friends.

I am concerned that the damage done by oversupply is causing newsagents to pass on opportunities presented by special interest titles such as Mollie Makes.  If I am right then shame on those who have dilutes and even killed the passion of newsagents for magazines.

4 likes
magazine distribution

Newsagency marketing tip: hype drives retail sales

I was in Vietnam recently and saw this terrific display in front of an electrical goods store. The containers stacked next to and op top of each other looked impressive. They made it look like there was a lot of sock to move and this supported the discount pitch.

While it does not look like good visual merchandising, it was, in fact, perfect for the pitch. Shoppers were queueing up to purchase the items. The no-frills approach felt believable even though, upon reflection, it was more likely part of a sophisticated strategy by the retailer.

We use a similar approach but on a much smaller scale in my newsagencies – cutting the tops off boxes of products we are selling at a good discount. This worked particularly well with boxed Christmas cards we bought in for our post-Christmas sales. However, we do it infrequently as we don’t want to educate shoppers.

Click on the image for a larger version.

3 likes
marketing tip

Newsagency management tip: track petty cash

Track cash you take from your register for petty cash payments. Otherwise, you educate those who see you that cash management / balancing is not important to you and invite their laziness on tracking cash.

Newsagency software can help you record petty cash taken out or cash added, this can feed into your accounting system and thereby provide an easier means of managing cash in your business.

2 likes
Management tip

Change your password now!

One newsagent this morning has discovered they are tens of thousands of dollars worse off because they did not change their business password. An employee used the password to manipulate data and hide the theft of cash. The newsagent’s distress is amplified by the realisation that basic steps to protect the business against such action were ignored.

Passwords exist to protect you and your business. Treat them with respect.

16 likes
Newsagency management

Late Christmas shoppers

How late have you seen someone shopping for Christmas 2012? Yesterday, I saw two guys in one of my newsagencies purchase cards, wrap and two gifts. They high-fived each other when they saw we still had cards and wrap available.

Are others seeing Christmas shoppers this late?

1 likes
retail

Silly games by politicians about living on the dole

It’s been disappointing watching politicians of all sides engaging in games on whether they could live on the Newstart allowance for a week. It’s typically ignorant of them to play these games. Media outlets run with the stories and the community remains poorly served.

Politicians who really want to empathise with and understand the challenges of their constituents would walk in the shoes of others for more than a week.

Take a small business like a local newsagency, a politician who wanted to understand our situation would live and work as a newsagent for at least a month. I am confident that such an internship would result in better small business policy.

I am not talking about a contest here, to see if they can make it. No, I want something more valuable, something real which they remember when they next consider small business issues.

They need to understand the challenges of government regulation, banking, retail tenancy, employees and competition – especially with the supermarket duopoly. Understanding can only come with them delving into the business. A ten minute photo opportunity may look good on TV or in the newspapers but it does not give them a lasting memory of what small business constituents go through every day.

Politicians of all sides have failed small business for decades. In 2013 I’d like to see genuine engagement in pursuit of genuine respect for one of the most important business sectors in Australia.

11 likes
Ethics

High-end candles work for us at Christmas

We decided to give these candles a crack in the run up to Christmas. At more than $50 each, they were going to be a challenge. But they worked! We sold enough to encourage us to try more for other seasons. They are not something we would carry all year but for Mother’s Day and Christmas we expect to have them again.

They worked best when we took one out of the box and ‘lit’ it. There is nothing like a practical demonstration to sell a product.

2 likes
retail

Promoting Unique Cars

We are promoting the latest issue of Unique Cars magazine with this aisle end display facing into our men’s magazine reading area.

I like the competition being promoted with this issue – it provides an excellent reason for us to give Australia’s top selling car magazine time in the spotlight.

2 likes
magazines

Politicians should block acquisitions by Coles and Woolworths

Just before Christmas there was discussion in the media about work between Coles, Woolworths and the ACCC on the oversight and regulation of their purchases of independent retailers. At the time, the ACCC Chair said they needed to watch for market power of the two supermarket giants.

Huh?! By any measure overseas, Coles and Woolworths already have too much market power.  Farmers, wholesalers, independent retailers, logistics companies – many complain about the bullying of these two on price. The only winners are the shareholders of the two and while that is good for them, the economic damage of their market share is considerable.

Politicians concerned about small businesses and having a strong and balanced economy should legislate to stop Coles and Woolworths. Politicians concerned for the Australian voice to be heard through high street retail ought to legislate to stop Coles and Woolworths.

But politicians won’t act. When it comes to these matters they are all words and no action.

Without legislation, the ACCC is powerless in this area as time has shown.

20 likes
Ethics

Whoa! Shock! Newspaper adds journalists and pages!!

The new owners at the Orange County Register in California are defying newspaper publishing trends by hiring additional journalists and adding pages to their print edition. The Huffington Post has a full report – read it.

Aaron Kushner added about 75 journalists and, with 25 more coming, will have expanded the newsroom by half since his investment group bought the nation’s 20th-largest newspaper by circulation in July.

Changes also include thicker pages with triple the number of colors to produce razor-sharp photos and graphics. By the end of March, the newspaper will have 40 percent more space than under previous owners, Freedom Communications Inc.

Kushner, 39, believes people will pay for high-quality news. His bet is remarkable in an industry where newspapers have shrunk their way to profits for years, slashing costs while seeking clicks on often-free websites to attract online advertising.

Of particular interest is their nearly five-fold increase in community news pages.

If their changes work, it will reinforce a theory among some that the medium is not the main cause of the decline in newspaper sales but, rather, the content.

This is a good news story about a new newspaper publisher taking risks and getting back to basics – giving readers more news that is more relevant to them.

I’d love to see Australian newspapers make moves like those at the Orange County Register.

12 likes
Media disruption

Promoting the traditional post-Christmas diets

We are supporting Women’s Health, Prevention and Good Health and their usual post-Christmas diet and health pitch with prime placement in our women’s magazine section.

Full cover display of these issues of Prevention and Good Health is especially important as traditional magazine fixturing will cover the free booklets attached to the covers.

I suspect titles with free booklets attached in this way work better in supermarkets where the full covers are almost always on display.

3 likes
magazines

Promoting real living

We are promoting the latest issue of real living magazine with this aisle-end display facing the front of the shop and our dance floor.

While it’s a good but visually basic display, the summer themed colours of the cover and poster do cut through against the sea of colour in-store. We can tell from activity at the display that shoppers are picking up the title.

2 likes
magazines

Wonderful back to work visual merchandising

Check out the back to work window display being rolled our by Loius Vuitton stores. It’s visually stunning – like all their window displays. It is also perfectly connected to the season without being all about price or looking boring like most BTS VM displays look.

While Louis Vuitton sells high end bags with excellent margin, I do think we can learn something from this display. It presents a strong visual connection with the season which is enjoyable.  Like any good display, your eyes are drawn to this window.  That’s the first step to getting you ton consider the products on offer.

We often judge our displays against other displays in newsagencies. I think we need to judge them against other retailers as these are our real competitors. This is where we, each of us individually, need to make visual merchandising choices that are appropriate to our specific business situation.

For example, do we display to compete with a supermarket? … a department store?  …  a card shop? …  some other specialist retailer?  I think these are interesting questions as I certainly believe that the days of displaying in ways traditional to newsagencies are no longer relevant to us.

Click on the image for a larger version.

6 likes
visual merchandising

Useful mouse mat from Pacific Magazines

I like the mouse mat from Pacific Magazines promoting their nexus program.

The mouse mat has got useful information about the nexus program and how we can engage. Their use of the mouse mat to remind us of this is excellent. It’s certainly reminded me to check sales performance when using one of the computers at the shop.

nexus is a unique program in that it makes it easy for us to promote our businesses to existing customers, outside our four walls. It also provides the best transparency of our performance compared to other newsagents. I’ve used this to lift sales of a range of Pacific titles.

One of the major features of nexus is the email marketing. While we used this in 2012 we were not as regular as we could have been. Our plan for 2013 is more regular emails with exclusive offers to shoppers on our email database. These emails cost nothing to send. Every nexus newsagent should be sending them twice a month.

8 likes
magazine distribution

New Years Day retail wasteland

I’d be curious if other newsagents in major shopping centres found yesterday very slow. Based on what I have heard, many independent retailers had a very quiet day and probably did not cover wages.

New Years Day is like Australia Day. It’s a day for relaxing and forgetting shopping.

While there are plenty of positives for being in a major centre, a day like yesterday is a definite negative.

9 likes
retail
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