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

Expanding the food magazine range

foodmags.JPGWe have increased space allocation for food titles to accommodate a broader range which we have sourced through Gordon & Gotch.  We are working closely on the food section as this is the section of most significant year on year growth – more than 20%.  The latest expansion, the second this year, gave us room for an additional seven facings in the regular food department and greater space in our impulse purchase display units.

As the photo shows, we are using key popular titles to act as a beacon to the food section: Master Chef, Donna Hay, Gourmet Traveller, Good Food, Better Homes and Gardens, Family Circle, BETTER basics … all can be easily seen from shoppers in this aisle.

The actual placement of the category is in the middle of the aisle.  It is never easy to know whether the start, the middle or the end of an aisle is best.  I have heard retail experts argue, especially about placement at the start versus the middle.   My feeling is that the middle is where you want to be, and at eye level – hence our considered placement of two pockets of popular titles in the top section of our magazine fixtures.

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magazines

Australian Traveller magazine travels far

austrav-abu.JPGTransiting through Abu Dhabi airport on Tuesday I noticed Australian Traveller magazine at the front of the travel section in the magazine rack at the only news outlet in the airport.  The magazine shelves were packed with titles, few were given full face treatment of this title – that’s why it stood out.

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magazines

Left field impulse product Berocca a hit

berocca.JPGNewsagents would not consider offering Berocca Twist ‘N’ Go at the counter a good fit impulse purchase product.  Newsagents who got in early, before the current national TV campaign, are having success.  It sells well to early morning customers who may have over refreshed themselves the night before.

Promoting this product shows a shift from the usual gum and other impulse products which tend to clutter newsagency counters.

As reported in the latest Convenience World magazine, Berocca Twist ‘N’ Go was voted Product of the Year in a Consumer Survey for Product Innovation.

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Newsagency opportunities

Newsagents need to shake off the shackles of regulation

Embedded in the DNA of many newsagents and the newsagency channel more widely is a belief in and reliance on regulation.  Our channel was founded in regulation, it was there in the beginning and exists today in various forms.

Given this history, it is natural for newsagents to cling to regulation with comfort and resist moves of genuine open competition.

Plenty of products we sell today are sold with regulation or at least some aspects of regulation: lottery products, postage products, newspapers, magazines, some gift lines.

Some newsagent suppliers do not help.  They want deregulation when it suits them to go into other outlets but then impose regulation over parts of their operation with newsagents which can make the newsagent offer less competitive than the offer of a competitor.  A good example is in magazine distribution.  While it has been deregulated, newsagents are not afforded the same controls and business building levers of their competitors.  It is like being half pregnant.

For our channel to have a bright future we need to completely shake off the shackles of regulation.  We need the freedom of a genuinely open market. We need this from suppliers and from ourselves.  However, it is not something which some can act on while others in the channel do not.  No, this is a move which needs to be carefully negotiated and navigated for and by all.

Newsagents need the freedom to operate all the commercial levers available to any business.  This will help smart newsagents grow.  It will increase competition within the channel and this is vital as we navigate through this period of considerable disruption.

One of the reasons we are seeing more newsagencies close than ever before is that we have allowed the channel to be protected at its weakest points for too long.

Some will say that removing regulation will devalue our businesses.  This could happen if valuations are not based on the real profits generated by a business.

If we don’t remove the shackles of regulation, around magazine and newspaper supply, the sale of lottery tickets and some gift lines, we will see sub standard operators protected and the channel held back as a result.  I would much prefer to see a smaller stronger channel than the alternative.

Let the debate begin.

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Newsagency challenges

UK high street retail mix changing

The Guardian newspaper published an interesting report yesterday on the changing nature of the retail mix to be found on the UK high street.

A stroll down the high street used to be about buying pork chops at the butcher and a bunch of carnations from the florist, but a new study suggests a haircut and a nail buff now top our shopping lists.

The rapidly changing face of Britain’s high streets shows an army of hairdressers and beauticians on the march but the number of newsagents, butchers and independent fashion stores in marked decline as they struggle to compete with the onslaught from supermarkets and larger chains.

A third of independent high street stores are now cafes, pubs, restaurants and takeaways rather than traditional retailers, according to a study of 75,000 retailers by an insurance company.

Notice the role attributed to supermarkets in these changes?  Have you seen the newsagency store within a store concept developed by Coles and which is evolving to a new level here?

Australian newsagents thinking about the future are sure to find the report interesting.

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Newsagency challenges

Promoting The Outdoor Room

magoutdoor0611.JPGWe are promoting the latest issue of The Outdoor Room at the front corner of our sales counter with this simple impulse purchase display.  We are also supporting the magazine in a half waterfall with garden and outdoor titles.  It’s a title people will buy on impulse when they see a new issue out.

We cycle through these counter promotions quickly, giving each title a few days to show that it warrants the prime counter position for a week.

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magazines

Promoting AWW Health

mag-awwhealth0611.JPGWe have been promoting the latest issue of The Australian Women’s Weekly Health with this aisle end display capping the entrance to our busiest magazine aisle. The week long display gave the title good support in our newsagency.  At the same time we maintained an excellent display for the title in with our health titles.

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magazines

42 more Angus & Robertson stores to close

The administrator of Angus & Robertson last night announced the closure of another 42 Angus & Robertson stores.

These closures present more opportunities for newsagencies located near the closing stores, as many of us are finding with stores located near the closing or closed Borders stores.

There will be short term and opportunistic deals on fixtures and stock.  Then there is the longer term opportunity of playing in the book space.  As many newsagents are finding, books can be excellent for attracting new shoppers as well as building basket efficiency from existing traffic.

It is not often that we have an opportunity to spread into new areas.  The decline of the A&R network is an opportunity every newsagent should assess.

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Book retailing

Partwork opportunity for newsagents: Baked & Delicious

baked-delicious.jpgA new partwork, Baked & Delicious, launches on Monday July 18.  Baked & Delicious looks set to be the most significant partwork launch in years.  In the UK, part 1 sold in excess of 600,000 copies.  Given the extraordinary sales of food titles here, I expect per-capita sales in Australia to surpass sales in the UK.

While the publisher sees the target market as women 25 and over, housewives, I see it more broadly than that given the people buying food titles and the broad interest in the various TV food shows.  That said, a survey of customers in the UK revealed that 95% of people buying the title were women.

Each fortnightly issue comes with a new piece of silicone bakeware and a magazine with recipes. It is the bakeware which will make this partwork appealing.  The items include: cupcake cases, pastry brush & spatula, loaf mould, flan moulds and muffin moulds.

The title is to be promoted in a $800,000 TV campaign starting on Wednesday July 20.  The TV campaign includes spots on MasterChef.

Distributor Gordon and Gotch has been working with newsagents on the launch, to ensure good communication and to maximise sales for the title.

I urge newsagents to get behind this title.  Contact Gordon and Gotch.  Check your allocation.  Lift it if you think it is too low.

My only concern is that Gotch is doing a split delivery.  I have recommended against this but they see that they have little choice given the size of part 1.

Click here to go to the UK website for Baked & Delicious.

Why promote partworks?
I like partworks titles because they are habit based.  They give us an opportunity to own the customer, to lock them in for repeat visits.   Newsagency shopping baskets containing partworks are, on average, 33% bigger than shopping baskets not containing partworks.  So, they are efficient. TV campaigns promote newsagencies.  Newsagencies have historically been the only retail outlets with the titles.

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magazines

Newsagents: beware of second hand computer hardware

I’ve recently heard of newsagents being offered second hand computer hardware as part of a cheap deal with newsagent software.  The spin usually is that a nearby newsagency has closed down just after they installed a system and their almost new hardware is available.

Newsagents being offered this deal should check to ensure that the person offering it meets legal requirements for dealing in second hand goods.  They should also ask for and verify the details of the newsagency which closed.  Oh, and get warranty details in writing re the secondhand goods.  And, get in writing the total cost of ownership of the software over, say, five years.

Someone once said that a deal which looks too good to be true often is.

Caveat emptor.

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newsagent software

Two good magazines to display with newspapers

magdlbb.JPGWe have been promoting BETTER basics and diabetic living from Pacific Magazines at the counter, between our top selling daily newspapers.  Not being monthly or weekly, shoppers can forget when the next issue of these popular titles is out – hence the placement at busy point at the counter.

Our magazine sales are up, well into double digit growth, in part due to our obsession with tactical placement.  More and more shoppers in newsagencies are in and out.  We need to chase these shoppers, the ones who do not browse the store.  We need to help them find magazine titles which will interest them.  Hence our valuable obsession.

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magazines

Featuring Unique Cars

mag-ucars0611.JPGWe are promoting the latest issue of Unique Cars with this in-location display is a feature area we have created to drive impulse purchases of men’s magazines.

The location of this display will see it seen by more male shoppers than if we left it in the men’s magazine aisle.

The creation of this impulse location is another example of our obsession with magazine placement and display.

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magazines

Age and SMH to ditch broadsheet?

Check out the interview published at mUmBRELLA with Jack Matthews of Fairfax Media where he says that he would be surprised if the Monday to Friday editions of the Sydney Morning Herald and The Age remained in broadsheet format.  I’d like to see this move.

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Newspapers

Newsagency of the Future (Part 2)

I am planning a series of Newsagency of the Future workshops for next month, picking from where the series I ran last year left off.

I think it is time for us to go beyond what might happen and consider specific plans for what the future of individual newsagencies and the channel more widely will look like.

There is good data to inform decisions by those who want to ride the crest of the wave of change.

I don’t claim to have the answers, but I do know how we can navigate, individually and collectively (in small or medium sized groups) valuable and defining moves for our businesses.

As I plan for the workshops and sift through topics to consider, I’d ask newsagents these questions:

  1. Are you concerned abut the future of your business?
  2. With everything you sell being available at a range of other businesses, why will your shoppers continue to shop with you?
  3. How do you know this to be true?
  4. With the sale of print products challenged, what new areas do you see for your business?
  5. If you were all powerful what would you change about your business?
  6. What are you good at?

Feel free to email me direct at: mark@towersystems.com.au.

I hope to have dates and venues sorted out by mid next week.  I am looking for this workshop series to provide a platform for conversation between newsagents about the business model and how this can be adjusted to make the most of the marketplace in which we find ourselves today.

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newsagency of the future

Promoting BETTER basics magazine

mag-betterbasics.JPGWe are promoting the latest issue of BETTER basics magazine (from the Better Homes and Gardens team) with a multi-pronged approach: this prime location display, location with daily newspapers and placement with our popular food section.

With BETTER basics being quarterly, we know that we need to remind our shoppers when the next issue is out.  Hence our commitment to high traffic location promotion.  Shoppers will usually see the title at least twice in an average visit.  We expect this to work well, leveraging recognition gained from promotion of the title on TV.

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magazines

Promoting In Style magazine

mag-instyle.JPGWe are happily promoting the latest issue of In Style magazine with this display facing on to the dance floor.

The free hair care pack which comes the magazine maks this issue especially valuable – our team made the value of the gift nicely obvious in the display.

I often complain about gifts with magazines, that they lack relevance to the title and are, well, boring.  That’s not the case here, the hair care gift pack is ideas for In Style magazine.  Newsagents should promoting this issue in an especially good location.

In addition to this prime space display, we are also promoting the title in its usual location.

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magazines

Attention Australian newspaper publishers – this is how to run a consumer promotion

dailymail.JPGUK shoppers who purchase The Mail today (Sunday) and The Daily Mail next Saturday are to be rewarded with a free £5 Tesco (supermarket) shopping voucher.

The promotion is all about driving sales of the newspaper, including retail sales.  All retailers of newspapers benefit.  There is no long term commitment, no subscription offer shifting the retail customer to cheap home delivery.

The value of rewards increases as loyalty increases.  or example, shoppers buying seven out of eight consecutive Saturday and Sunday newspapers get to choose another £5 voucher, this time from The Body Shop, Boots (pharmacy) WH Smith (newsagent chain), BP and more.

the process of registering and redeeming is easy, it is all handled through a the newspaper’s website.

While I am sure that there are deficiencies in the rewards program which I cannot see, it looks like a far more considered and respectful offer than the recent Herald Sun promotion with Woolworths or the one they will run shortly with Bunnings or the perpetual free copies of The Age at Fitness First outlets.

The campaign by The Daily Mail reads like a back to basics loyalty program.  It’s simple, honest and quick to deliver rewards.  I have pitched this to News Limited in the past without success. I guess it is more valuable to them to reward big advertisers than to respect all of their retail channels.

You can read more about The Daily Mail promotion here at their website.

Australian publishers have invested too much in driving home delivery subscriptions and not enough in driving over the counter sales.  If the publishers had to carry a fair cost of fulfilling home delivery then they would not have pushed subscription growth as they have.

As newspaper sales are further disrupted by mobile digital devices, Australian publishers would be well advised to look carefully at engaging in smart promotional campaigns in association with retail newsagents, their largest, most important and most valuable retail network.

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Newspaper marketing

Editor declares newspapers a sunset industry

Bob Cronin Editor in Chief at West Australian Newspapers says newspapers are a sunset industry, according to a report published by The Australian yesterday.

It is good to see such a respected newspaper person be so clear about this.

One criticism I receive regularly is that I talk down print.  Sales numbers of print newspapers and the increase in the use of digital platforms for distributing news inform the view that the life of print has no upside and, indeed, is quite limited.

As challenges mount for print newspapers we will see more radical efforts by publishers to slow the decline in sales.  I suspect that publishers will continue to ignore retail newsagents and the opportunity they present.

The same edition of the newspaper carries an opinion piece by Campbell Reid: Don’t buy tickets to newspapers’ funeral: they are here to stay.  His optimism (who would expect anything less?) has more to do what what is not published on paper.

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Media disruption

Discounting The Economist and The Financial Times

economist.JPGIn Australia, at the moment, it is only in the women’s magazine area where we see current issues bagged for a discount.  In Europe I noticed this 20% discount pack for FT Weekend (The Financial Times weekend edition) and The Economist.  Both titles were also available separately in-store.

While the 20% off is a good deal for the shopper, I am not so sure about the retailer.

Interestingly, this was the only time I saw bagged current issues over the last week of traveling.

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magazines

Another space efficient magazine display

genevamags.JPGIt seems that everywhere I look in Germany and Switzerland most magazines are displayed the same way.  The magazines which sell in volume, usually ten to twelve titles, are displayed flat andd the rest and fanned out – as this photo I took earlier today in an outlet in a suburb of Geneva.

The owner tells me that he has no complaints from shoppers and that magazines account for 40% of his sales.

Maybe we have educated our shoppers to want a magazine retail experience which cannot be justified – at least in shopping mall situations where retail space costs $1,300 per square metre a year and more.

If I was to display the number of magazine titles I saw in this store in the way which we display them in my newsagencies I would need at least four times the retail space.  As the retailer asked my today with a shrug of his shoulders – but would you sell any more?

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magazines

Plenty of small format magazines in Europe

smallmags.JPGI was surprised to see so many small format magazines in Germany and Switzerland.  In most cases there is a larger format version elsewhere in store.  Click on the image to see the display atg the entrance to one transit newsagency I visited yesterday.  There are eight small format editions of monthlies.  There is obviously a market otherwise publishers would not invest the money.

As I have written here previously, the challenge with these editions is the size.  here in Europe they address that by displaying the small format editions on flat display units – as shown in the photo.

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magazines

A different approach to tobacco retailing in Europe

chesterfield.JPGIt has been fascinating seeing the free rein given to tobacco companies and retailers for promoting tobacco products.  From the promotion shown in the photo – a compelling poster on the floor leading the shopper to Chesterfield cigarettes – to the LCD mounted in the counter and over which change passed in every transaction.

While cigarette packs contain a health warning, this is lost among the onslaught of advertising in even the smallest, hole in the wall almost, outlets.  In one regional Tabac outlet (50 sq m) which sold magazines (300 titles), drinks and tobacco products, they had a large LCD screen behind the counter and a LCD screen mounted in the counter.

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Newsagency challenges

Swiss Post Office sells lottery tickets

swisspost.JPGWhile the Swiss Post Office does not sell stationery, greeting cards and many other items Government owned Australia Post retail outlets sell, they do sell lottery tickets.  I am not sure if lottery products are sold in just some outlets or network wide. I know how newsagents would feel in the government owned Australia Post outlets started selling lottery tickets.

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Australia Post

The German newsagency

germannews.JPGIf what I have seen is the case across the country, shopping malls here in Germany usually have just one newsagency.  The store in the photo was no more than 60 square metres.  The products offered are: magazines (between 700 and 800 titles), Lotto, tobacco products, drinks and not much else.

The cornerstone of the magazine model is range.  Two, sometimes three, copies of a title.  Very few titles in volume to flat stack.

Talking to the retailers they see their value proposition as range of magazines and being local (convenient).

It is terrific having an opportunity to see these stores up close and to chat to owners or managers (where they speak English).  Seeing how a sister channel operates in other countries is part of essential research to navigating our own future.

Footnote.  In the mall where I took this photo, I could not find a single greeting card retailer.  Some retailers had a spinner of cards, but not the range we see in many stores in each Australian shopping mall.

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magazines

The German post office survives without selling sewing machines

germanpost.JPGOne of the excuses Australia Post has used in the past for extending the reach of products sold in its network of 800+ government owned post offices is that mail does not pay.  The German postal service experienced the same challenge yet solved it in a more logical way.  German post offices sell products which are allied to postal services like mobile phone connections.  You won’t find books, greeting cards, business stationery, picnic sets, sewing magazines, cameras or ink and toner in German post offices.

Australian Politicians when challenged by small business on competition from Australia Post re-spin the Australia Post line.  Successive governments for the last fifteen years have ignored small business and sided with their own protected corporation.

The German postal worker I spoke with a couple of days ago laughed at the range of products sold in Australia.  He also wondered how the government could do this to business.  Indeed.

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Australia Post
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