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

WTF The Monthly?

I’m in Perth at the Virgin Australia lounge and they have a couple of stacks of the latest issue of The Monthly here for the taking.  Okay I get it that they want to attract new readers and therefore don’t begrudge them offering it for free here.  What irks me is that here in Perth they are giving away the latest issue while newsagencies back east are yet to receive this issue.

Publishers should give retailers like newsagents priority. We sell their product after all. No excuses!

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magazine distribution

A TO DO list for newsagents from the sales benchmark study

With each newsagency sales benchmark study I try and provide a TO DO list for newsagents based on learnings from the data.

Here is the TO DO LIST for newsagents based on the data I have been immersed in as a result of the latest study:

  1. Do a full magazine relay. Every magazine off and rebuild your placement from the ground up. No excuses. I have done it. Sales will increase as a result. Call me if you need advice on this.  (I will have more on this tomorrow).
  2. De clutter. Have products in one location and not many. Make the statement you make at each high traffic location obvious and strong.
  3. Get into gifts.
  4. Look at your external marketing campaign. Your competitors are spending between 2% and 5% of sales to drive traffic.
  5. Look at how much you allocate to time on the shop floor. This is where incremental growth comes from.
  6. Refresh stationery and get serious about promoting this department.
  7. Ask your card company for another performance review.
  8. Look carefully at your basket building strategies and ensure that you are making the most of foot traffic.

The most important competitor a newsagent has is themselves. This is why regular comparison against past performance is vital to the success of the business.

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magazines

Refreshing our approach to music magazines

Over this past weekend we created this simple co-location display of key music magazines. The display is is located opposite our newspapers and will see more foot traffic than where music magazines are located.

While music magazine sales are good, up on last year, we want to drive an even greater increase.  Hence the positioning of them in this high traffic location for the next couple of weeks.

We are also taking the opportunity to look at what other titles are available to us to expand the range. We are better placed to do this than a magazine distributor deciding for us what new titles we could sell.

While we gave music magazines good positioning in our magazine relay in September, I am not happy with where they are and am keen to find a better location. As always, space is the challenge.

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magazines

Promoting diabetic magazine titles

I’d encourage newsagents to check where they have The Australian Women’s Weekly cookbook – cooking for diabetes.  We have been enjoying success with this title placed with the excellent Diabetic Living title in our health section.   While cooking with diabetes does sell from our ACP cookbook display, it is this placement with health titles and, in particular, Diabetic Living, which works a treat.

This is an example of why newsagents need to engage in magazine placement themselves.  Being attentive to tactical placement will result in a sales increase.  Also, this type of placement enables us to play beyond what our competitors in supermarkets do.

 

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magazines

Governments should stop pandering to car makers and their employees

I was disappointed to see media coverage in the last few days from union representatives and others calling for more government support for auto manufacturers so that Australian can keep General Motors, Toyota and Ford producing cars here.

While I understand the interest in supporting the manufacturing sector and thereby keeping jobs, government assistance provides false economy, it protects the businesses and those who work in them from reality. This, in my view, makes them less competitive.

I don’t see the long term value in government assistance packages, especially when governments do it for one sector but not another.

Imagine the boost to the economy if every dollar of government assistance was spent on building needed infrastructure or providing for needed and underfunded government resources such as health and education.  Surely this more practical investment would be more valuable than protecting uncompetitive industries.

Newsagency businesses live or die by the decisions of those who own and work in the businesses. There is no safety net, no parachute, not since 1999 when the federal government deregulated the distribution of newspapers and magazines.  Many newsagents are still digesting the ramifications of the deregulation. This has been made more challenging by the lack of government support.

The auto makers say that they can’t compete with China and India.  Hmm, our print products are challenged competing with digital yet there is no support or assistance package.

My point is that governments or all colours support some industries and not others.  I think this is wrong.

We all need to be accountable for our situation. Tough as it is, dealing with what we face relying only on ourselves will make those who do make it stronger, more competitive and more valuable to the Australian economy.

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Newsagency challenges

Nice back to work sales

While Back to School is the season many retailers focus on in January, the Back to Work season is equally valuable.  This time of the year we have seen a surge in general stationery sales and boxed pen sales plus second surge in diary sales.  Since it’s not a high profile season we are able to run it with healthy margins since it’s more about convenient shopping than getting a great deal … as long as the prices are reasonable.

Indeed, Back to Work is an ideal reason / excuse for newsagents to reach out to businesses in their areas and offer a Back to Work stationery supplies top up. A perfect opportunity to pitch the convenience of supply without having to place an order or even unpack the goods.  And, who knows, you could sell some magazines for the lunch room or reception area.

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Stationery

Promoting How to set up an online business

We are promoting the How to set up an online business magbook in our business section. It’s an impressive looking title which is on sale at an ideal time.  This is an opportunity to show our relevance to the growth in online retail and to reach beyond what I think our shoppers expect to see in a magazine department.  We’ll also give this title a run next to newspapers as it’s not something people will visit looking for.

Magbooks are much bigger in the UK than Australia. I expect to see more come through this year.

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magazines

Connecting with the Wiggles controversy

We are opportunistically promoting the current issue of The Wiggles magazine with the now sacked Wiggle on the cover.  I’m hoping it could be a bit of a collectors item. It should be given the considerable controversy over the last couple of weeks following the sacking and the pro handling of it by the Wiggles organisation. So, we have the magazine in a good location with the full cover on show.

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magazines

Have you been rejected on a returns claim?

I have spoken to a couple of newsagents in the last week about returns credits which were refused with the distributor saying they did not receive the stock.  I’m posting this today to invite comments from newsagents who have had returns credits refused for this reason. If this has happened to you please share your story.

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magazine distribution

Selling IdN magazine

We’re very happy with the performance of IdN magazine. By giving it better positioning, so the full cover is easily seen, we are achieving better sales and attracting more shoppers interested in design.

This is one of those niches in which newsagents can shine, a niche which is important to medium term magazine sales. You won’t see this title in c-store, supermarkets or other outlets. It’s a perfect newsagency title, an opportunity to show off our magazine specialist credentials.

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magazines

Ripper Girlfriend magazine sales

The latest issue go Girlfriend magazine has been selling its socks and we’re chasing extra stock to make the most of the opportunity.  The free nail foils and the terrific display are working a treat.

What is helping drive sales is the social media campaign being run by the publisher Pacific Magazines.  The Girlfriend magazine Facebook page has promoted newsagencies as the go to retailers for this issue.

If newsagents don’t have this issue out and in the spotlight then I’d suggest you give it a crack.

I always check sales for titles we promote as it’s important for these displays to produce a commercially valuable result.  Too often newsagents leave the displays to others and don’t check or care about how this valuable retail real-estate is performing for the business.

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magazines

Promoting magazine value packs

While I am not a fan of the discount packs of current issues of magazines, we are giving them a go in high traffic locations to see if they do deliver the incremental growth which I am told happens in supermarkets and transit outlets.  We have a couple of these packs this week from ACP and so we have placed them on the basket builder stand at the front of the newsagency, with the non-discounted version of each title.

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magazines

Promoting Burke’s Backyard

We are promoting the latest issue of Burke’s Backyard magazine with this aisle end display.

The display has been up over the weekend and as you;d expect we achieved some nice sales from this location as well as the usual location for the title.

What’s interesting is that the display is in the men’s section of the store, towards the rear.  We’re pleased that it working here as well as if it were facing into the front of the newsagency.  It just goes to show that being in the front of the newsagency is not always essential.

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magazines

Latest newsagency sales benchmark study results released

Yesterday I provided the results of the latest newsagency sales benchmark report to participating newsagents.

Overall, newsagents had a good end to 2011.  The year ended with better numbers over 2010 and 2010 ended over 2009.

I am concerned about the difference between newsagencies.  There is no doubt in my mind that the strong are getting stronger. They are achieving growth from specialisation and diversification. This is evident in the sales data.

Even the data itself speaks to the difference between businesses. Newsagencies with well-managed data perform better. I can assess attention to data management in department and category structure and in whether every item sold in the newsagency is being scanned.  This is why I am able to say that newsagents who are better at managing data will have more successful businesses.

What is interesting about this is that newsagents have complete control over how data is managed in their businesses.

Here are the newsagency sales benchmark highlight results for type of newsagency:

  1. Increase in basket depth. What is particularly evident is the increase in basket depth among more newsagents.  In short, more newsagents are selling more in each sale.  This is vital to our success as retailers. Not enough though, less than half the newsagencies in the study achieved this – at least this is up from just a third a year earlier.
  2. City versus country. It was harder to separate the results here compared to the last study where country newsagencies clearly performed better.  The data indicates to me that city newsagencies ended the year stronger than their country counterparts.  There difference was not as obvious.  That said, bigger country newsagencies performed better than smaller.
  3. Shopping centre versus high street. Except for a few of the larger high street newsagencies, shopping centre businesses performed better, more of them were in the grouping with better sales results compared to the year earlier.
  4. Rural. I looked at the data I had from a group of rural main street newsagencies. They did okay. Some growth, some increased sales efficiency – getting existing shoppers to purchase more. The challenge here appears to be driving more traffic.

Now let’s look at the results by key departments.  Note that for some departments I use unit sales and others I use dollar revenue:

  1. Magazines. 26% of newsagents in the study reported unit sales growth with an average growth of 3%.  Of the newsagents reporting unit sales decline, the decline was 7%. NOTE: I have not included data for newsagencies reporting extreme results as this would skew the results. For example, sales in one of my newsagencies are up 45%. This is primarily due to a complete magazine relay, considerable external marketing and store specific opportunities.  Rural and regional newsagencies were more likely to report a decline than a city based newsagency.  At the MPA category level, women’s weeklies, motoring titles and sports titles were the most challenged, reporting higher declines.  Food, crafts, crosswords and special interests continue to be the stand out categories, recording growth.
  2. Greeting cards. 57% of newsagents reported revenue growth.  The average growth from this pool was 3%.  Of those reporting decline, the average decline was 4%.
  3. Stationery. 60% of newsagents reported growth in stationery revenue in a major turnaround from the previous study.  The average growth was 3%.  The average decline in revenue for stores experiencing decline was 6%.
  4. Ink. 46% of stores participating in the study separate ink sales data allowing further analysis.  62% of stores reported ink revenue growth with 5% the average increase.  Of those reporting decline, the average decline was 3%.  Ink continues to be an important product category given the habit nature of the product. Win an ink customer on price and or service and you have them for life.
  5. Gifts. 52% of the stores in this study have a gift department.  70% of these reported an average sales increase of 8% in gift revenue.  Of those reporting a decline the average was 6% which is a concern.  The big concern in the gift data is that almost half newsagents do not have a permanent gift department. This is dreadful. A newsagency is a natural fit for gift sales. This is an easy department to move into, one over which you have pricing, ranging and other control. It is a department through which a retailer can shine.
  6. Newspapers. 40% of newsagents reported an increase in newspaper sales.  The average increase was 2%.  Of those reporting a decline, the average decline was 8%.

Here are some other stats from the assessment of the data provided:

  1. Average basket size. There are 1.63 items in the average newsagency basket not including lottery products. This is significantly up on the recent average.  More than 50% of newsagents experienced an increase in basket size.
  2. Customers served. 54% of newsagents experienced an increase in customers presenting at the sales counter. The average increase was 3% – not considerable but welcome nevertheless.

In the last study it was capital city shopping centre newsagencies which were most challenged.  In this study they are the ones enjoying the best results. This speaks to the fickle nature of shopping centre sales performance.  While am no economist it could be that they are the first to experience trends.

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Newsagency benchmark

Gotch cuts supply of Delicious magazine

For no apparent reason, the magazine experts at Gordon and Gotch have cut our supply of Delicious magazine.  We have sold out, as they would expect. We have ordered extra stock to satisfy demand for this excellent magazine.

For magazine experts the circulation people at Gordon and Gotch sure make planty of mistakes. This cut in supply of Delicious magazine is unwarranted when considering our sales data.  This situation is frustrating. It provides another example of how newsagents are treated poorly in some supply decisions by magazine distributors.

While the folks at Gotch will undoubtedly have their excuses, given the volume of stock they received from the publisher and the certain returns from supermarkets, there is no reason they could have supplied me at a level so as I could achieve my sales potential.

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magazines

Promoting ACP cookbooks in the newsagency with a personal recommendation

Here is another example of how our team is embracing the personally recommendation of magazine titles. One of our team members loves the ACP cookbook so that she wanted to tell our customers. From a business perspective we don’t control these personal recommendations – otherwise they would not be personal.

Read the endorsement and see for yourself how personal this is. It’s another example of the personal connection with what we sell can separate us from other outlets which sell what we sell. While supermarkets get these cookbooks, they get them weeks after us. Plus, I doubt they would let their team members engage in this type of personal endorsement … they’d probably want to charge the supplier for it.

We need to find more ways to separate the shopping experience in our businesses from those of competitors, including other newsagents. This is a survival of the fittest marketplace and even the smallest touch which separates your business, on a good way, is vital for a bright future.

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magazines

News Limited hurts newsagent sales with free newspapers

Shoppers yesterday at Bunnings in NSW were offered a free Daily Telegraph newspaper.  While I cannot be sure, based on the nature of the promotion and the photo I was sent I’d expect it was run widely in the state.

Every time someone sees the Daily Telegraph available for free it dilutes the value of the product and educates them to expect to not have to pay for the newspaper in the future.

While giving away newspapers usually paid for may make sense to the short and long term business goals of News Limited, free newspapers are nothing but trouble for newsagents. They harm a product which still is core to our identity.

Why News Limited?  What’s the plan?  While I think I know, it would be good for the company to share with newsagents their plan so that newsagents can plan themselves.

While even the paid for Daily Telegraph is only a dollar and has been for 14 years or more, is is still something people pay to access. Every time it is available free is a step closer to a purely free model.

News will have the excuse that this is a campaign paid for by Bunnings. While that may be so, there appear to be more free campaigns paid for by one party or another: gyms, sporting events, the races, music events and retailer situations.

If it were me I’d respect my product more.

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Newsagency challenges

Apple chasing card sales

Like I am sure every other registered Apple customer I received an email this week from Apple promoting their custom Cards app.  The pitch was simple, as Apple pitchers always are. It made a compelling case for using Apple to share a greeting or feeling next time…

The Cards app from Apple makes it easy to create and mail beautifully crafted cards personalised with your own text and photos — straight from your iPhone or iPod touch. Download it free from the App Store today.

So all you need is an image, the app and someone to send the card to. Apple does the work for you including posting the card. It’s a long way from then traditional greeting card. I wonder if this is the card for the mobile and connected generation.

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Greeting Cards

Finding a home for Time Out magazine

We have struggled to find the right place in our newsagency for Time Out Melbourne. We’re out in a suburban shopping centre and don;t have commuter traffic. Also, our shoppers are usually women, 35 and older, not your typical Time Out reader. We have the title with music magazines and with teen to twenty girls magazines.  But that felt wrong.  So, yesterday at around 5pm I moved it to next to the newspapers. True story – within five minutes a young guy purchased a copy.  I told him we were struggling with where we should put it. He was certain – Time Out should be with the newspapers, it’s where he looks for it in newsagencies. So that’s where we will place it for the first few days of the on-sale. Given the demand for this premium space we will either then move it somewhere else or find a way to create a display opportunity so that it can be permanently with newspapers.

It’s amazing what you learn when you seek advice from a customer.

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magazines

Promoting New Idea Jumbo Puzzler

Check out the counter display we have done for New Idea Jumbo Puzzler for this weekend.  We are planning on using this space in front of our Ticketek counter for a selection of individual magazine titles and categories of titles over the next few weeks.  Given the tremendous success we have have with this new title I figured that it was well worth trying at the counter. We still have copies in their usual location. This counter display will run for the weekend and into the start of next week.

This type of display is all about selling titles easily understood and purchased on impulse to shoppers who are unlikely to move further into the store to browse the magazine range.

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magazines

Strong start to magazine sales in 2012

As a follow up to my post earlier this week about how uneducated and ill-considered early returning of magazines by newsagents could kill magazines for our channel, I thought I would share some data for the newsagency I directly and most consistently influence. It is one of three newsagencies I own or have a half share in.  This data speaks to me practicing what I write here.  It  provides the best measure of how my processes pan out at the sales counter. It shows that growth is possible in magazines.

Crossword sales are up 124 units, 108%. Women’s weeklies are up 151 units, 18%. Craft and hobbies are up 47 units, 168%. Special interest sales are up 51 units, or 124%. Right across the board except for Children’s and Buying & Selling sales are up.

This is our third January so we are well established.  We have another newsagency, two supermarkets and a couple of other outlets selling magazines in the centre.

All of this growth comes from hard work and commitment from the team running the business and my involvement.  We promote the business regularly externally. We have a strong new traffic generation campaign.  We have an equally strong campaign in-store for driving a deeper basket with more magazines. We entice magazine customers back.

While magazine sales are challenged we have a medium opportunity. They continue to offer us today the best point of difference over any other retail business which sells everything else we sell. This is why I am concerned about ill-considered and uneducated early returns.  They send the wrong message to the publisher.

I think that many newsagents have it within their capacity to grow magazine sales. Sure it’s hard work. The reward is what you bank and the increased value of the business.

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magazine distribution

Promoting Valentine’s Day sales

This is the display our team created for behind the counter to promote the two JAG watches we are giving away for Valentine’s Day this year.  We wanted to focus on the key message of the opportunity to win the watches.

Elsewhere in-store we are promoting our Valentine’s Day gifts and greeting cards … which are already selling well I’d note.

I like being able to give away prizes in-store. I think customers appreciate that a local shopper is certain to win the prize we are promoting. This makes winning the prize more attainable. It’s another reason we are so strongly promoting the prize opportunity.

Now before anyone asks, the watches are part of the Hallmark Alliance promotion for Valentine’s Day.

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Greeting Cards

Dolly not looking its best on the shelves

The latest issue of Dolly magazine is not looking its best on the shelves.  The stock and weight of the free quiz magazine glued to the back of Dolly is not holding well and so drags back, making the stock look a bit ratty.  This is a pity because the offer is good – the magazine, the quiz magazine and the free pen for doing the quiz.

The problem is that the quiz magazine is glued up so that it stands above the magazine. The paper stock is not thick enough to hold the weight of the quiz magazine in stock. After a day on the shelves, unless the pockets are jam-packed, you end up with the ratty look in the photo.

I doubt it will affect sales. At least I hope it doesn’t.

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magazines