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

Advertising drives impulse purchases at the Point of Sale

Check out this simple video I shot of how we are currently using our LCD customer displays at sales points at one of my newsagencies.  While we are transacting a sale half the display shows the sale and the other half a different ad message.

M4H02105 from mark fletcher on Vimeo.

We run different campaigns through this sales counter advertising medium. Each focuses on a single product category. I like using this space to promote phone recharge as it is something so easily sold at the sales counter.

While the margin on telco recharge is slim, any purchase on impulse in addition to the destination purchase is valuable.

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marketing

Hello Kitty moment of truth

mag-kitty2.JPGIssue two of any part series is a moment of truth for the future of the series.  This is true for the Hello Kitty partwork.  We are displaying it in the same location from where part one sold out in our newsagency.

I think the two mugs which come with part two will help drive sales, they will certainly appeal to Hello Kitty collectors and fans – hence our placement at the counter.  It;s not as if many shoppers will visit looking for this product.

There are significant changes occurring in partwork supply in Australia this year.  UK publishers are more engaged directly locally.  I am not sure yet whether this is a good or a bad thing for newsagents and their position in the partworks supply chain.

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partworks

More newspaper home delivery consolidation

Newspaper home delivery is on the move with more newsagents selling, merging or walking away from their newspaper distribution territories. While I do not have accurate data, there is no doubt, based on newsagents I have directly spoken with, that movement around distribution businesses has picked up pace this year.

I suspect that the surge in movement is due to new contracts from News and Fairfax which are expected to further challenge the model, a model which the publishers themselves created and which they have controlled since its inception.

It is interesting seeing more corporate distribution businesses emerge through this period of disruption and consolidation. There appears to be more activity in Victoria in this area than any other state from what I can tell.

While the challenge for newspaper distribution businesses remains, the larger businesses do have more opportunities for leveraging scale to their advantage.  They can achieve this by reducing management and other overheads.

That said, the newspaper home delivery model is a problem which needs attention.

A model where you cannot set your sell price, cannot reasonably control your costs, cannot leverage ‘your’ customer base for other revenue and have to lower margins when your supplier discounts their product is a difficult model in which to grow outside of acquisition and this has its own costs.

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newspaper home delivery

Promoting Gourmet Traveller magazine

mag-gtrav.JPGWe are promoting the latest issue of Gourmet Traveller magazine with this simple in-location display in our food section.  It is the only food title on display like this so it is easily noticed as you enter the aisle with food titles.

I know I keep going on about food but it is a category which is enjoying a long run in the sun … excellent sales fro many different titles.  We expanded our range thanks to help from Gotch in this space and these new fringe titles are also selling well.  We made a decision that food would be one of the categories we drive to show off range and it is working a treat for us.

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magazines

Promoting Vogue magazine

mag-vogue-611.JPGWe are promoting the latest issue of Vogue magazine with this aisle end display.  While not a high volume seller for us, Vogue does position us well in the fashion space – hence the commitment to this feature display.  The display will be up for a week before being replaced.

Sometimes, displays are not so much about the volume of magazines we will sell but more about showing off the type of titles we sell, outside the top 50 or so titles we carry. The free gift with this issue of Vogue adds nice value to the display.

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magazines

Borders to close remaining stores

The administrator for REDgroup Retail has announced today that the remaining Borders stores in Australia will close by the end of July.  This will bring to an end the Borders presence in Australia, leave a hole in another nine shopping centres and present more opportunities for newsagents in the book space.

The closure of Borders will cause ripples across book retailing.  It will make publishers and other suppliers more wary.  It will also reinforce a subtle message about books in print.

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Book retailing

OfficeMax brand more obvious at Australia Post

maxpost.JPGThe latest Australia Post catalogue is promoting the OfficeMax brand prominently next to the Australia Post brand.

Taxpayer dollars have paid to get the recognition achieved for Australia Post.  We have protected Australia Post with a monopoly over postal services and many products.  Under this monopoly they have become lazy … this is what comes with protection.

Successive governments have protected Australia Post and facilitated the expansion of the commercial services it operates outside of core postal services.

All of this taxpayer funded support is being used to boost the profile of OfficeMax and to help the government owned Australia Post retail outlets, 850 or so of them, to take business from small business newsagents.

Newsagents continue to be shafted by government owned Australia Post retail outlets.  Thanks politicians from all sides for your support.  Not.

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Australia Post

Promoting Australian Photography magazine

mag-austphotography.JPGWe are promoting the latest issue of Australian Photography magazine with this in-locations display near the entrance of our men’s and hobbies magazine aisle. This is our first time giving this title such a focus … we’re hoping it will respond well with sales. It is a good title with which to say – hey our photography magazines are here.

This is what beacon branding is about, using well known and easily understood magazine mastheads to signpost where categories and segments are located.

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magazines

Promoting Donna Hay magazine

mag-donnahay611.JPGThe cover of Donna Hay magazine is stunning and I am sure that showing off the full cover will help drive sales. With so many new issues out yesterday and on Monday, we are challenged for space so we have Donna Hay sharing this display with the earlier released Delicious magazine. While this may frustrate publishers, it was either do this or one title loses out. Our thinking is that both titles appeal to a very similar shopper – we’d like those shoppers to purchase both titles.

With food continuing as the hottest magazine category, we aim to have a food display up all the time in my newsagencies.

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magazines

Promoting Good Health magazine and socks

mag-ghealth-socks.JPGWe are promoting the latest issue of Good Health magazine with this display at the front of the newsagency, acing into the mall as well as a display in with our women’s health related titles … the kind of engagement you would have seen from many proactive newsagents yesterday. It’s an excellent giveaway – nicely related to the title and ideal for driving incremental business for the title.

I was in a supermarket and a transit newsagency yesterday and they were doing nothing special with this title.  It was lik the free socks were of no interest to them. Newsagents, this is our opportunity to show off the newsagency difference. Show publishers that thee other channels do nothing special.

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magazines

Who is that man with Twiggy Forrest?

afrjune2.JPGSo much for the story selling the newspaper.  Today’s Australian Financial Review covers the face of the new chief executive for Fortescue Metals and part of the lead story about the economy with a post-it note type ad from the Bank of Cyprus.

I feel for the editorial people who worked on both news items.  The ad placement shows that ad dollars trump editorial in the hierarchy of the publisher of the AFR.

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newspaper masthead desecration

Engaging my local federal parliamentarian on EFTPOS fees

Here is the text of a follow up letter I have sent to my local member of parliament on the EFTPOS issue.  I am sharing it here to give newsagents an idea of how they might respond to the letters from some  parliamentarians which look like they have been written by the same person.

EFTPOS FEES AND EPAL

Thank you for responding to my correspondence.

Bruce Mansfield, CEO of Eftpos Payments Australia Limited (EPAL) has done a wonderful job fighting off queries from politicians seeking answers on behalf of their constituents.

While EPAL has nothing new to say, it has done so inn such a way as to spin that the new fee regime is an opportunity for retailers.

It is more spin designed to deflect attention from the role being played by his board which is controlled by the major banks, Coles and Woolworths.

The facts which Mansfield ignores are:

  1. The 12 million Visa and MasterCard debit cards are dual cards i.e. also EFTPOS cards. They can be used in both networks depending on the cardholder pushing credit or check/savings.
  2. The EFTPOS network has become more expensive i.e. 1.2B Transaction by 11 cents, 800M by 6 cents. I am flabbergasted by the claim of “net impact zero”.
  3. The retailers can negotiate with acquirers challenging the acquiring margin, but how are they negotiating with issuers challenging the interchange fee? That is the one that was raised.
  4. The acquirer and retailers have to carry the bulk of the investment to save EFTPOS from the Bankcard demise. Why do they get charged?

Bruce Mansfield serves the issuing banks and major retailers sitting on his board to levy an ”EFTPOS tax”. It is a fee that banks now get to continue to issue EFTPOS functionality on their debit card.

Unjustifiable and untimely. His best position, if he had the survival of EFTPOS at heart and if he could decide, would be to maintain the cost advantage of EFTPOS versus scheme debit cards.

I hope that you and your colleagues support small business and help us to gain attention for this issue at the highest possible level.

If nothing is done, small and independent retailers will soon face higher EFTPOS fees than Coles and Woolworths. This would be unfair. It would also make a mockery of competition and small business policy.

EPAL should not be controlled by the banks or major retailers. It is like putting an alcoholic in charge of the bar. Of course the banks and retailers in control of EPAL will make decisions which suite them.

Retailers like family run newsagencies need your help, your voice challenging this new EFTPOS Tax. We need you to fight for us.

Don’t let go of this issue newsagents.  Keep engaging with your local politicians.  Otherwise you could be complaining about higher EFTPOS in the future knowing that you did not act today.

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EFTPOS fees

Coles discounts car magazines

discount-magazines.jpgColes has been running a discount on car magazines from ACP in its current catalogue in Melbourne.  There on page 29 of the catalogue is the offer: shoppers can choose any two of Street machine, Wheels, TopGear Australia or Motor.  It’s a good deal.

I can see that the deal is designed to drive sales of car magazines in Coles locations.  I expect that ACP is funding the discount one way or another, but I could be wrong on that.

Maybe I am wrong but it feels to me that discounting, like in the Coles catalogue and the double packs, is on the increase.  This will only serve to educate shoppers to expect to NOT pay full price for magazines.  I don’t see that working for retailers unless there is sufficient incremental business or margin protection from suppliers.

Now some reading this might counter with the observation that the Magazine Club Card I have run since 2004 is the same thing.  It is not.  It is based on customers buying more magazines than they would usually purchase in a specified period – in my case it is 8 weeks.  The reward for their loyalty is a discount, a free magazine.

Sure, the Coles offer is about getting people to purchase two titles.  I feel that the barrier to getting the reward is too low.

Newsagents will need to find ways to compete with deals like this as I suspect that they will become more prevalent.

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magazines

Promoting Burke’s Backyard

mag-burkes0611.JPGWe have been promoting the latest issue of Burke’s Backyard at at the entrance to our garden / food and home magazine aisle.  I love the work of our team in selecting colours to tie in with those on the cover of the title – nice as we lead into winter … bringing colour to the shop.

In addition to having Burke’s Backyard stock on the display, we have stock in the usual location for the title.

This display will remain up for a week after which we will probably migrate to an in-location display or possible a coupler display depending of space demands.

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magazines

Promoting Complete Wedding magazine

complete-wedding-counter.JPGWe are promoting Complete Wedding magazine at the counter with this simple impulse display. This is not the usual type of magazine one would expect to see at a newsagency counter for impulse purchase.

I am pleased to see the team giving the magazine a go and expect sales to continue to surprise us about what we can sell on impulse at the counter.  Notice the Only $9.95! pitch across the front of the display – designed to attract attention.

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magazines

Rolling Stone publisher questions rush to iPad Apps

Rolling Stone publisher Jann Wenner has questioned the rush of magazine publishers to the iPad.  The US journal AdAge reports this and other comments fro Wenner in an excellent article.

It’s a good magazine reading device, absolutely. And where it becomes more convenient to read the magazine on that, that’s got the advantage. But that’s more convenient only if you’re traveling, if you’re away from home. Otherwise it’s still easier to read the physical magazine, which is widely available on newsstands, at airports, and everywhere. You can still subscribe to get it and get it on time. You still get all the value of the magazine.

I don’t think that gives you much advantage as a magazine reader to read it on the tablet — in fact less so. It’s a little more difficult.

From the publisher’s point of view I would think they’re crazy to encourage it. They’re going to get less money for it from advertisers. Right now it costs a fortune to convert your magazine, to program it, to get all the things you have to do on there. And they’re not selling. You know, 5,000 copies there, 3,000 copies here, it’s not worth it. You haven’t put a dent in your R&D costs.

So I think that they’re prematurely rushing and showing little confidence and faith in what they’ve really got, their real asset, which is the magazine itself, which is still a great commodity. It’s a small additive; it’s not the new business.

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Media disruption

Subscription offer from Express Publications makes newsagents look expensive

4wd.jpgNewsagents pay $6.78 for Australian 4WD Action.  Subscribers can get the title delivered to their letterbox for $3 an issue. This is the pitch in a recent email campaign from Express Publications for this and some of their other titles.

The email opens with: Roothy believes our magazine subscribers should be rewarded for their loyalty.  I wish that ‘Roothy’ would reward newsagents for their support and newsagency customers for their loyalty in purchasing issues regularly in newsagencies.

I understand that subscriptions play an important in the overall sales mix for a magazine.  What I do not understand is the extraordinary price difference and the creation of first and second class readers.

Every day newsagents see regular shoppers purchasing the same titles.  Indeed, many of us have putaway customers who are effectively subscribers.  The Express Publications offer ignores our regular customers.  It also ignores the tremendous work newsagents do to promote a title.  Without this work, making our expensive retail space and specialist labour available, subscriptions would not be what they are.

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magazine distribution

Magazine Launch: Coach

mag-coach.JPGWe’re thrilled to see Coach launch from Pacific Magazines yesterday.  This men’s personal training title under the Men’s Health imprint is targeting a popular male health and fitness area – personal training.

Just check out any gym and see how many personal trainers they have available.  It is a big and growing market.  Coach caters to that interest – to those into personal training and those who want the motivator without the cost.

I think this is a timely new title, a title newsagents should get behind.

We are promoting the launch issue of Coach in a feature area facing out onto the dance floor of the newsagency.  We also have stock with Men’s Health.  his is a title guys could buy or girls could buy for their guy.

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magazines

Borders / Angus and Robertson challenges grow

The Age yesterday had a report indicating that the Borders / Angus and Robertson situation is worsening with more layoffs announced by the company.  I was in a Borders store late yesterday and it’s magazine and book departments were looking depleted … presenting opportunities for nearby newsagents.  Sure it is profiting from someone’s misery … it’s also business.

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Book retailing

Promoting Top Gear Australia

mag-topgear-inloc.JPGWe are promoting the latest issue of Top Gear Australia with this in-location display.  It looks terrific – if I do say so myself.  The team has made excellent use of the collateral provided by ACP and while it is not a power end, this display is where it needs to be for impact.

I watch shoppers and guys tend to take far less notice of visual merchandising displays than girls.  This is why I prefer in-location displays for car magazines.  It is like the guys don’t notice anything until they reach the safe haven of the men’s magazine aisle.  They even talk to each other down there … not in the body of the newsagency.  It’s probably a retail version of the tool shed or workshop.

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magazines

Australia Post announces fuel surcharge … newsagents should follow

Australia Post has announced a one percent fuel surcharge on domestic and international parcels and international letters.  The Sydney Morning Herald has details.

Given that newspaper home delivery drivers are paid under an award relating to transport, newsagents should have the capacity to pass on cost increases, such as the fuel hikes which have hit since the newspaper distribution fee structure was last set.

While there has been some movement in some states, it has nowhere near kept up with the increase in fuel costs.

This situation where distribution newsagents have no reasonable business levers with which to manage the profitability of their business condemns them to shoulder an unfair burden in the cost of getting newspapers to subscribers.

Like Australia Post and other transportation, distribution newsagents, local transportation companies, need the right and capacity to pass on cost increases to those who use their services.

I bet newspaper publishers factor in cost increases when they set their advertising rates.

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newspaper home delivery

Cardeaux opportunity for newsagents?

I have been told by a couple of sources that the Cardeaux card and gift stores have hit difficulties and are closing.  Newsagents near Cardeaux locations could have an opportunity to take back card and gift business. While this may seem unfair against Cardeaux, business is business and anything newsagents can do to build their market share of core categories, even at the cost of a weakened competitor so be it.

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Gifts

Promoting Australian Traveller magazine

atraveller-may11.JPGWe have been promoting the latest issue of Australian Traveller magazine with this full face placement between food and travel.  We also have a couple of copies with women’s titles … so covering the locations people most likely interested in this title would be shopping.

Food is the fastest growing category in this newsagency so we figured that placement with food made sense for Australian Traveller.

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magazines

Using Sundays in your newsagency

I was talking with a newsagent yesterday who was frustrated at the high cost of labour on a Sunday.  His comment … all they do is serve … stood out.  I asked what stopped him scheduling work to be done on a Sunday, as you would a regular day.  He agreed that they had time to get projects completed during the day but was concerned that he would have to train them.

Sunday trading is often seen by newsagents as retail (serving) only.  I see it as anther regular day in the work week, getting projects completed, moving the newsagency forward, creating new displays, refreshing old displays, making sure that the business looks different than it did a few days ago.

If you do treat Sundays as a day for serving only then you;re probably not making as much of the premium labour cost as you could.  I’d encourage newsagents not engaged in making the most of Sundays to do so. Create some projects or tasks. measure outcomes.  See how much time you can save from your busy Monday workload and maybe adjust hours as a result.

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Newsagency management

Girlfriend magazine nail polish gift drives sales

gf-mags.JPGWe have been promoting Girlfriend magazine in a feature location for the last few days.  The promotion has been working a treat with excellent sales achieved.  It’s bagged, because of nail polish gifts with the magazine, and wondered if the bagging would hurt sales.  I spoke to two girls who each bought a copy yesterday – they said that they usually like to browse the magazine but the nail polish was enough to get them to both purchase.  What was interesting was that they would usually share one copy.  Not this month.  This nail polish gift idea looks to be working a treat for sales if what I am seeing in my store is happening elsewhere.

I’d encourage newsagents to feature this issue of Girlfriend, make sure that your shoppers can see the genuine value of the gift with this issue.

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magazines
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