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

Profitable angels build a better basket

mag-angels.JPGThese magnetic angels sold well last year so we decided to give them another shot.  We are on track to sell out.  Customers are buying three and four at a time, on impulse.

While the angels make an excellent counter offer, we move them around.  This past week we have been promoting them near boxed cards – with terrific success.

Items like this are about building a deeper basket first and driving margin dollars second.

Okay, so we won’t retire on the profits from this one line.  However, they are an excellent way of driving greater value from the existing excellent traffic we see in our stores, especially at this time off the year.

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retail

Disappointing move by Darrell Lea into Woolworths

dl-woolworths.JPGI have been thinking through the move by Darrell Lea to place their liquorice in Woolworths supermarkets.  It does not make sense to me.  Darrell Lea has been demanding of their licencees for many years, requiring that their product be displayed in Darrell Lea fixtures to respect the brand and requiring that we take a minimum range of product and not just top sellers.

There are many rules, rules which most newsagents have embraced because they want the point of difference that carrying the Darrell Lea brand brings.

Given that liquorice is the stand our top seller for Darrell Lea, newsagents and other Darrell Lea stockists have lost the point of difference.

While we will still sell Darrell Lea to our shoppers, there will be some who stop buying.  These are the regular (pun intended) customers who stop by each week for their bag of Darrell Lea liquorice and nothing else.

This move by Darrell Lea is like the move by newspaper publishers and magazine publishers into supermarkets and other retail channels.  They still require us to adhere to rules which they ignore for their new retail buddies.  We are restricted in what we can do while the new channels have more control – with magazines especially.  The rules for us versus them make us less competitive.

Darrell Lea are doing what they think is right for their business.  Good luck to them.  As a Darrell Lea stockist I am left wondering about all of their preaching for many years about the respect they want from retailers for their brand.  Going into a mass network like Woolworths throws all that preaching out the window.

I saw their liquorice in two Woolworths supermarkets yesterday.  It was lost in a sea of candy and treated the same as the cheap liquorice next to it.  Back at my newsagency, Darrell Lea continues to be treated as a hero product, situated on the Darrell Lea required wood stand and located in just about the best position in-store.

It feels like Darrell Lea does not respect its long standing retail partners.

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confectionary

Promoting to customers as they leave

knox-leaving.JPGThe photo shows the display facing customers as they leave one of my stores.  Our team invests as much time in displays facing customers as they enter as they do in displays facing customers as they leave.

Throughout the store there are displays designed specifically to engage customers as they leave an area of the store.

We watch customer interaction and adjust accordingly.  The displays are significantly changed weekly.

Displays facing out from the front of the store are designed to attract traffic from across the mall.  Displays facing customers as they leave are designed to grab attention up close for easily understood season specific impulse items.

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Newsagency opportunities

The value-add point of difference

book-reindeer.jpgWe have the Hallmark The Night Before Christmas recordable storybook and have been good, until the Target Christmas catalogue came out a week ago.  Target gutted the price of this and a bunch of stock to kick start what I understand has been an awful Christmas for them so far.  Rather than be seen as a direct competitor and lose on price, we have the Hallmark reindeer plush on offer for just $5 extra with the storybook.  These reindeer retail at close to $15.00 so the combined deal is $10.00.  On top of this we have the storybook priced at $5.00 off RRP.  So, the total saving is $15.00.  This takes us away from being a competitor of Target.  Target does not have the reindeer.

The recordable storybooks are wonderful products. They provide a level of emotional connection between giver and recipient which goes far deeper than a regular gook gift.  Kudos to Hallmark for this innovation and their backing of this with a national TV campaign starting tonight on Hey Hey It’s Saturday.

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Newsagency opportunities

Social media trumps real news

I and some colleagues were stuck on a plane on the tarmac at Tullamarine airport in Melbourne last night for more than two hours.  Our flight from the Gold Coast landed just about on time at 8:15pm.  It was 10:30pm when we deplaned.

I checked in with the websites for the Herald Sun and The Age but could not get much information.  Twitter was more helpful.

On the way home in the car I expected to head details of the story on the radio – next to nothing was reported.  Again, Twitter had more accurate information.  I knew this would be the case because of the number of people in the two thousand or so in the terminal waiting for flights who were active on their phones.

This is the era in which we live.  Sometimes, old model news services take too long to get an immediate story out.

Our plane was one of twenty or so which had landed and which were stuck on the tarmac.  Inside the terminal there were thousands affected by Melbourne’s wild weather.  Twitter connected us through this shared experience in a way which old media could not.

It was interesting experiencing this first hand.

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Media disruption

Shame for The Age

age-nov25.JPGThe front page of The Age newspaper on Thursday brought shame on the publisher – Fairfax.  Covering half the story reporting on the tragic loss of life in New Zealand was an ad announcing Here’s a Good News story.  The folks at Fairfax have no one to blame but themselves.  I hope that the editorial team uses this to fight harder against the advertising and finance teams within Fairfax to illustrate the damage their focus on money covering up news is doing to the brand.

Note: I have been on the road for the last two days and did not post this sooner as I did not have the image.  I took this photo from a copy at a Virgin Blue lounge.

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newspaper masthead desecration

Promoting body + soul

body-soul.JPGWe are promoting the launch issue of body + soul with strong displays in my stores.  This is a new title which has grown out of the popular supplement in News Limited newspapers.

body + soul enters the already successful women’s health segment – a somewhat crowded segment in my view.

In addition to a high profile display, we have the title well represented with women’s health titles.  We also have a pocket in with women;s weeklies for this first week of the on sale.

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magazines

Promoting high volume magazines with full face display

spacing-mags1.JPGWe are further trimming magazine range in several categories to enable us to full face display two pockets – as shown in the photo.

Looking at the magazine range carefully, we see an opportunity to target titles which deliver sales or one or two over a month.  We are better serviced by cutting these titles and increasing sales of the high volume titles.

I expect that the net effect of the move will be an increase in magazine revenue.

While the publishers of the lower volume titles will not be happy, I have to make decisions which are appropriate to my business ahead of theirs.

At this stage, we are making these moves in Home & Living, Gardening and Food.  All strong categories where I feel we can achieve good sales growth at the top end of titles.

My frustration is the road blocks at Network Services and Gordon & Gotch to newsagents who want to implement considered decisions like those I am discussing here.  Their automated increase in supply has me bucketing water out of the leaky boat when I can make more money for both of us if they stop the leak from happening in the first place.

I would not implement this across the store at this stage. I think it works best as a pocket of a point of difference – as the photo shows.  these titles stand out from those around them.

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magazines

High returns cost for double magazine pack

magazine-returns.JPGWe sold half of the double back of The Australian Women’s Weekly and Good Health.  A chuck of the margin we made from the sales was lost as we had to pay $8.00 to ship back the returns – yes, these double packs have to go back as full copy returns.  This is a problem with packs which are experimental in newsagencies.

I’m not given a choice on participation and therefore not given a choice on the costs associated with the promotion.  I am happy to consider participation if agreement can be reached on performance and the cost of a pack not meeting reasonable KPIs. I’d expect that supermarkets would have similar requirements.

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magazines

Books make an easy gift

fhn-bookscards.JPGWe are trying a range of books at the end of one of our card aisles.  We made the move as we figured that these particular books are an easy add-on to a card purchase and a valuable margin builder to the sale.  The titles were selected based on what we know to be the interests of many of our customers.

This most was one of a series of changes made in the last week to the store, embracing our mantra of perpetual change.

Indications are that the change is working for us.

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Book retailing

ACP launches more iPad apps

ACP Magazines has launched two more iPad apps, this time for cookbook titles including the runaway success of 2010 – Slow Cooker.

While some newsagents will be frustrated by this, I see it as ACP doing what they need to do for their business.

There is a fundamental shift of retail online and these iPad apps are part of that move.

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Media disruption

Beware of this mobile phone recharge scam

I heard from a newsagent yesterday about this scam.

Someone rings indicating that there is an e-pay issue re a $100 Optus (or any telco) recharge unpaid but issued and now used that they will have to charge to your account. They say that if you print another voucher and read out the numbers they can use that one to cancel our bill.

This is a scam.  Never print a voucher and give the number over the phone.

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theft

Promoting The Australian Women’s Weekly

aww-inlocation.JPGWe are promoting the Christmas edition of The Australian Women’s Weekly with the in-location display in the photo plus a flat stack between the Herald Sun and The Age as well as a four pocket full face display facing customers as they enter the store.

It is a busy issue with the Christmas theme, a cookbook stuck on the cover and a royal engagement souvenir stuck on the back. There’s a lot going on with this issue, maybe too much.  Time will tell.

This issue is too thick to fit two copies in our slim pockets.  So it is one copy per pocket.  We’ll live with that and top up several times a day.  We are contemplating a promotion showing off one or two things from the free cookbook. Retail theatre always works well.

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magazines

Update on banking margin dollars

pizza.jpgFurther to my post on the weekend about the importance of banking margin dollars compared to margin percentage.  We have now sold over $1,000 worth of Junior MasterChef product in less then a week.

The new customers this display has attracted will be valuable beyond the sale as some will come back.  Many bought more than the Junior MasterChef product once they got into the store. We have learnt plenty about attracting shoppers from the mall into the store.

The big lesson is the reinforcement of the importance of margin dollars banked.  You cannot bank a percentage.  Too many newsagents chase percentage without focussing on the alternative of faster movement of more competitively priced product.

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Newsagency opportunities

Customers love different Christmas crackers

crackers.JPGThe different range of Christmas crackers we have sourced this year are loved by our customers.  We have had several comments that they are different to what they are seeing elsewhere.  We’re seeing no push back on price which is a bonus as these are not your cheap and nasty crackers.  Having a point of difference in a shopping centre is a good feeling.

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Newsagency opportunities

Swamped by resumes

School is almost out for another year and we are almost drowning in resumes from high school students looking for Christmas work.  Twenty five resumes in the last week.

Since we are hiring we look at each carefully.  If it’s a no we email, call or write with this news.  I figure that we owe them a response even though their application was unsolicited.

We have a standard email we send to people who get to the next step, asking a few questions.  Their response determines if they get an interview.  We’re hard core.  Having an email address and a mobile phone is essential. Being able to answer questions in an email is an indication of communication skills – the questions are designed to weed out candidates we would not want to hire.

While the hiring process is about us finding a good candidate, it is also our opportunity to provide helpful feedback to candidates along the way – it’s business after all.

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Newsagency management

Victorian Government ignores newsagents

The Victorian State Government has shafted this newsagent one too many times.  They can shove Myki …

When Myki was first announced we signed up and were told that we would be the outlet in our shopping centre.  We have watched the tortured roll out of Myki expecting the hear soon about our machine for selling and topping up these transport tickets.

Finally, we are told they are just about ready – this is AFTER they have installed a Myki machine in the shopping mall.

So stuff them.  This is yet another Myki balls up.

So much for the State Government caring about small business.  No, they’d rather pay hundreds of millions for a flawed ticketing system than support small business.

They have not kept their word with me.  I have no interest in playing thier game and making scraps from topping up Myki accounts.

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Newsagency challenges

Newsagents being talked about

Media experts see a sad future for newsagents. A future with no news. In a world of instant online news, RSS feeds and smartphone news apps, the newspaper as we know it is simply on its last legs and with the advent of E-newspapers, the good old paper tabloid gets another nail in its coffin.

This is the opening paragraph of an article published at GAJ-IT about the new digital only newspaper from News Corporation.

GAJ-IT is not alone in publicly speculating about the long term future of the channel.  Good newsagents will thrive amid all of the disruption we see around us.

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Media disruption

Junior MasterChef mook promotion

nc-mook.JPGWe are promoting the Junior MasterChef mook (magazine / book) with our Junior MasterChef merchandise, creating a perfect tie-in.  We know the interest in our area given the extellent sales (close to $1,000) in Junior MasterChef merchadise in the last week.  My only beef is that we received only two copies of the mook, the rest is due next Monday.  Not having sufficient stock to create an eyecatching display will hurt sales this week.

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magazines

Oprah calls the iPad her #1 favourite thing ever

An endorsement from Oprah’s Book Club sends publishers printing an extra 500,000 copies of an anointed book.  For years, the Oprah phenomenon has proved to be valuable to publishers and other businesses.  Why else would Tourism Australia and Tourism NSW invest more than $3 Million bringing Oprah and her show to Sydney?

On Monday in the US, the second part of Oprah’s Favourtie Things show aired and she named the iPad the greatest invention of the century so far and her favourite thing ever.

This endorsement ensures mass market appeal for the iPad and similar devices.   Cnet has more.

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Media disruption

Newsagency opportunities as Staples starts making moves in Australia

The Australian yesterday published a story about moves US stationery giant Staples is making in Australia.  Having completed their takeover of the Australian marketplace and completed research on opportunities, they have decided to start with a new online presence.

Staples has launched a local Staples website, initially targeting small to medium businesses in NSW and ACT.

This website is the first step for the Staples brand in Australia.  While the Officeworks spokesperson is putting on a brave face in the article in The Australian, they would have to be concerned.  Staples is a successful organisation in internationally.  Their stores set the benchmark.  They carry an excellent range, price competitively and – here is the kicker – they engage with small businesses in a practical and helpful way which drives loyalty.  Do one of their small business workshops, once they start here, and see for yourself.

Newsagents need to develop a strategy for dealing with the opening of Staples here in Australia.  I think that the channel needs a National Stationery Plan.  I would see such a plan covering:

  • Consistent minimum ranging.
  • Consistent minimum in-store display standards.
  • National pricing on key lines.
  • Online training opportunities for newsagency employees.
  • National advertising that Newsagents are Back In Business – a campaign which leverages our local credentials.

I know that some of these ideas will be a challenge.  If newsagents don’t tackle the stationery threat / opportunity head on, we will be looking back in a few years wondering if we should have.

Outside of marketing groups and associations, newsagents need together and support a national plan to shore up current, win back old and attract new stationery business.  A concerted and consistent campaign should drive double digit growth for newsagents.

The question is whether newsagents want this enough to make it happen.

At my recent Newsagency of the Future workshops around the counter I identified stationery as a renaissance category full of opportunity for newsagents. I am confident that with a strong national approach, newsagents can expect 2011 to be a great year of growth across the business by leveraging stationery as our point of difference.

Footnote.  The ANF Board was close to deciding to enter into an agreement with Corporate Express (now Staples) late last year.  I ran a campaign at this blog against the move.  I thought any commercial relationship would be wrong because CE would use the newsagent information to compete.  Time has shown that the decision to not proceed was a good one for newsagents.

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Newsagency opportunities

The News / Apple newspaper venture

The Guardian on Sunday published a report about the new digital newspaper coming from News Corporation which I have written about here previously.  This is the project which Rupert Murdoch is on the record as saying is his most exciting project at the moment.  The report offers more analysis of an apparent News / Apple tie-up to lainch the new digital only newspaper.

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Media disruption

Books hot for Christmas

christmasbooks.JPGSales of Christmas themed books have been terrific over the last week to ten days.  Excellent numbers in my stores, most of it impulse business which makes it even more valuable.  We started with our books on display between the entrance to the store and our newspaper display.  Now, they have been moved to another, equally high traffic,  dance floor location.  Regular moves helps us maintain excellent sales while we have the stock.

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Book retailing

Promoting the AFL season 2011 Fixture

afl-season2011.JPGWe placed the AFL Official Fixture 2011 in the only logical location yesterday, between The Age and the Herald Sun.  With many times more eyeballs seeing this location than our sporting titles location, this was the place for the fixture if we wanted to achieve the best possible sales.  We are thoughtful in deciding what to place between the two newspapers, usually cycling through two to three titles in a week.  I know that some newspaper publisher representatives do not like magazines in ‘their’ space, they need to realise that impulse purchases help strengthen the business and publishers need stronger newsagencies.

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Newspapers