We have sold out of some of the Father’s Day gifts we purchased especially for the season. That’s a nice result a few weeks out from the big day and encouraging for expanding the gift department outside of major seasons.
The gifts which have performed best so far are wine related – carry bags, kits, bottle holders.
I was saddened to hear the new that Daryl Fedden, a stalwart of the newspaper and magazine industry in Victoria and nationally for over 30 years passes away on Monday afternoon after a long illness.
Daryl served as Circulation Director of The Age and Herald & Weekly Times and held senior executive roles with Southdown Press and Gordon and Gotch.
I knew Daryl as the magazine expert of the newsagency channel of the day. He was an innovator, encouraging newsagents on range and display. I recall him, many years ago, trying to educate newsagents on the importance of full face displays. Back then, newsagents used to show around half the face of a magazine vertically.
Daryl was a gentleman. He loved newsagencies and worked tirelessly on our behalf even though he was employed by our suppliers. He helped many newsagents get their start and to overcome tough times. He also helped many newsagency suppliers.
Daryl Fedden’s influence can be seen today in our considerable market share of magazine sales in Australia.
Daryl’s passing is sad news.
We are using Your Garden as the anchor title for a spring gardening display out the front of our newsagency this week. We put this display up Monday morning and it is drawing good interest. Our plan is to leave it run through the week and the weekend before assessing sales. You can see from the photo that we have not over cluttered the display – our preference is to promote known titles which have achieved good sales for us in the past.
Publishers will think they can’t take a trick when they read this blog post. The delayed billing introduced by Universal Magazines for some of their titles is doing us no favours. Sure there is a delay for payment but we still have to find the stock. Plus, the way they handle the delay through XchangeIT means that we do not have accurate data on the shop floor indicating when the title came in. Regardless of delayed billing, if a title does not start to sell within the first month I am likely to want to return it. Publishers need to realise that product cost is only one of four factors in the cost equation.
The Darrell Lea Dad’s Bags for Father’s Day have started selling even though the big day is weeks away. We have the display in the photo at the front of the store facing into the mall, near to our three stands of Father’s Day cards. While 80% of Father’s Day purchases are made in the last week of the season, winning those sales happens early in the cycle due to consistent display like we have in the photo.
Our real push for Father’s Day started this week with a big book sale which is being promoted in catalogues delivered to homes around our shopping centre. Our experience is that Father’s Day is in the top three of book buying seasons.
At the trade shows I have attended recently – Melbourne Gift Fair and GNS Market Fairs in Melbourne, Sydney and Perth – conversations with newsagents invariably turn to the anticipated health of retail and newsagencies in particular. I have heard mixed expectations of what Christmas 2010 might bring for our channel.
What are your expectations for Christmas sales this year?
I must say that at the moment I am feeling pessimistic about Christmas 2010. The stimulus money has long gone, consumer credit is tight, jobs are under pressure, other retailers are moving more into the traditional newsagency offer, some traditional newsagency suppliers are focusing attention away from our channel, more shopping centres are opening than warranted by population growth and the magazine distribution model has not adjusted for the double digit decline in magazine sales over the last year.
Newsagent suppliers tell me that Christmas orders are down on last year.
So, what are your expectations for Christmas sales this year?
There has some concern expressed by newsagents about the quantity of issue 1 of The Art of Crochet part series which arrived in-store yesterday. The Art of Crochet is anticipated to be the biggest partwork launch this year. It is being backed by a national TV campaign promoting newsagencies as the go to places for this title.
My understanding is that the publisher and distributor are hoping to sell more than 100,000 copies of issue 1. This would put it within reach of the performance of the Masterchef launch.
I am not that concerned about the quantities of issue 1 sent to newsagents. The scale out was based on sales for The Art of Knitting as I understand it. I sold 235 copies of The Art of Knitting and received 280 copies The Art of Crochet.
I am responding to the opportunity with a display at the front of the newsagency, an impulse display near our newspaper stand and a bold display in our partworks department which is appropriately located with knitting and crochet magazines.
While newsagents need to make their own decisions about early returns, I’d suggest they hang on to The Art of Crochet for the next two weeks, promote the heck out of the title and measure sales before making an early return decision.
As UK newsagent Steve Denham noted in a comment here last month, sales for the first issue were “huge”. Unfortunately, Steve noted about supply challenges. Hopefully, the publisher has used UK learnings in setting the supply model for Australia.
Footnote: The Art of Knitting has been extraordinarily successful for us with customers sustaining putaway orders long after the launch.
We have promoted the latest issue of Health Smart magazine in with our weeklies as well as its usual location over the last few days. We opted for the tactical placement because of the free Biggest Loser branded calorie counter which is stuck to the cover of the magazine. This premium value drove good impulse business for the title for us over the last few days.
We are always looking at magazine covers for opportunities like this. Our magazine department is perfroming well as a result.
We have moved Annette Sym’s Symply Too Good To be True 6 to a small display next to our main newspaper stand – in addition to two other locations. Symply Too Good To be True 6 continues to sell well, making a mockery of the newsagents who early returned stock when the title first came out. Ignorant action like this by some newsagents brings shame on the rest of the newsagency channel. Too much of this action will give publishers reasons to look elsewhere for a distribution channel.
The best approach for this title is to put it in a high traffic location – at the counter, with your weekly magazines, with newspapers. Such tactical placement can be more beneficial than a big bold display for some titles. I have found that to be the case with Symply Too Good 6.
While I am on the record as not linking these magazine discount packages, we are giving the latest – NW and OK! – a run in a dump bin located next to our main newspaper stand. We took this approach for the last discount pack from ACP and it worked well for us. I do not want to place these discount packs in our regular fixturing as I do not want to educate regular customers to not pay full cover price.
We are promoting New Idea at the counter for the next few days because of thier tremendous support of Daffodil Day. 10 cents from every magazine sold goes to the Daffodil Day campaign. We have placed the remaining Daffodil Day merchandise next to the counter display for New Idea.
Pacific Magazines has a good track record for supporting charities by donating money from the sale of each copy of a magazine to an important cause. It is important that we newsagents tap into the spirit of the Pacific commitment and try and drive sales to maximise the donation.
We plan to keep the display up until Wednesday depending on sales.
I have heard recently of a newsagent permanently offering 10% off magazines as their poijt of difference strategy. This is bold step because of the slim margin, 25%, and that they are in a shopping mall with a high floor space cost.
While the magazine club card we run effectively offers a discount, the 1.5% cost is nowhere near as expensive as a 10% across the board discount – plus it requires the customer topurchase anabove average quantity of magazines over 8 weeks.
I would be interested to hear what other newsagents think of a permanent 10% discount off magazines? Is it an appropriate point of difference for a newsagency?
My argument against this is that newsagencies provide an excellent point of difference to other magazine retailers.
Maybe I am wrong but permanently discount magazines is like you are saying you cannot compete on these points and that price is the only unique selling proposition. My view is that price is no USP at all.
I was in Perth yesterday for the GNS Market Fair. It was a good trade show for the newsagency channel. While not as big as those already this year in Melbourne and Sydney, the Perth fair was busy with business … plenty of business in fact. I was surprised at the range of good quality sales leads – there were plenty of newsagents making plans for a strong finish to 2010.
The difference in trading conditions and business management factors across the country is as strong as ever based on what I have see that the three GNS Market Fairs so far.
GNS put on a good event in Perth, plenty of space, well laid out plus free food and drink!
The Herald Sun McDonalds promotion is frustrating. While I am aware of it, a distribution agent handling one of my stores had not made arrangements so our Sunday team were left scrambling to sort out what to do. My understanding that that there is to be a settling up of collection coupons at the end of the promotion. My view is that if I am giving away a free newspaper today then I ought to have the full cover price credit showing on the account this week.
As I have noted here before, I think this McDonalds promotion does no favours to the newsagency channel. Publishers should work harder with us on building newspaper sales in our businesses.
A week ago today I wrote to all 1,700 Tower Newsagents to invite their participation in a vitally important study into the cash flow implications of the magazine supply model.
Here is what I wrote to newsagents:
I am conducting new research into the cash flow implications of the magazine supply model on newsagencies and write to invite you to participate. I last did this in 2006 – a copy of the resulting report is attached.
This time I am not planning on writing a report. Rather, I am looking for data which can be used to get attention of regulators like the ACCC on issues with the magazine distribution model.
In one store for which I have data, they have experienced nine months out of the last twelve where magazine cash flow has been negative. In another store, their magazine bills have been more than magazine revenue for six months out of the last twelve. This is a not a sustainable business model.
There is a bit of work involved for us to get to an accurate understanding of your situation. However, once done, you can see the cash flow by distributor for your business. Plus you can easily run the report in the future without the one-off work.
To participate I need you to run the Magazine Cash Flow Report. I have attached an advice sheet which guide you on how to do this.
Here are my tips for creating an accurate report:
1. Enter your total rent cost including marketing and other levies.
2. Enter an accurate count of total floor space allocated to magazines in your store.
3. Take your time to get your pocket settings right.
4. Once you have completed the settings, take time to check them all again before running the report.Once you have the report on the screen, save it as a PDF and email it to me at mark@towersystems….
I will review every report. My expectation is that I will see a pattern of behaviour which could form the basis of a submission to the ACCC and other potentially interested parties on the magazine supply model.
While our software has excellent facilities for managing supply, I remain of the view that newsagents should not have to do this – the magazine companies should supply on a fairer basis and based on sales data.
Mark Fletcher
M: 0418 321 338
With the Tour de France over for another year we have taken the opportunity to refresh the bikes and general men’s health segment of our men’s magazine aisle. We have shuffled titles and reallocated space and created a fresh look designed to encourage browsers to purchase multiple titles. Click on the image to see a larger version of the photo.
We have implemented beacon branding principles to draw attention to the various areas of interest and to showcase top selling titles.
I know a bit about the bike marketplace since my software company has been selling software to specialist bike retailers for ten years. Bike buyers happily spend money on their passion. The opportunity for us is selling two or three bike magazines to each shopper with this interest. This is one of the reasons I am happy to spend time refreshing the offer.
Time Inc has struck a deal enabling subscribers of People magazine to access the People iPad app for free. This is an important more for publishers as it provides a lower cost bridge across which they could invite migration of subscribers from print to digital. Arts technica has more on this.
To attract new customers to the iPad and other tablet platforms, publishers will need to introduce more competitive pricing or risk losing eyeballs to start-ups.
For several months now we have been dealing with the prospect of moving our newsXpress Forest Hill newsagency temporarily to accommodate major construction works at Forest Hill Chase.
Yesterday, the final piece of the proposed temporary move fell into place and it is set to become a reality.
In two or three weeks we will downsize our 330 sq meter newsXpress Forest Hill store into a 95 sq metre store for between four and six months while our current location plays a key role in a major extension to level three of the centre.
Frankly, I am glad to finally have certainty of the move plans. It has been time consuming and challenging navigating the considerable complexity of even the possibility of a temporary move of this size. In addition to our own needs, we have had to work in with the needs of our landlord and other key stakeholders.
The change is also coming at a time of management change in the business with our long term manager deciding to take on another role in the business.
We are looking forward to the challenge and opportunity of taking our larger format newsagency business and condensing it for our time in our temporary location. In addition to temporarily downsizing, we are moving from level 2 to level 1. We expect to learn a lot about the business and come out the other side, when we relocate to our new permanent home, with a fresh offer for the folks at Forest Hill Chase Shopping Centre.
I’ll blog here about the journey from time to time, using the moving shop category.
Some product categories will be rested while we are in our temporary location. Broadly speaking, however, we will cut magazine range by 25%, stationery by 60%, social stationery by 50%, gifts by 50% and cards by 5%. We are finalising this list at the moment and will start to speak with suppliers this coming week.
There are bound to be road blocks and speed humps along the way. There are also bound to be valuable discoveries. We are keen to embrace all of the challenges because we are certain that we will be better retailers as a result.
Footnote: the photo at this post is of the perimeter of the construction zone outside our entrance. It is a thrill to see the newsXpress logo there next to the logos of other key retailers in our current part of the centre. The landlord decided on this list!
Our promotion of Australian Geographic’s Outdoor magazine on our main newspaper stand is working for us as I figured it would … delivering impulse purchases! The free Jules Lund DVD included with the magazine helps broaden the appeal of this issue – hence the tactical placement with newspapers. We also have the title in its usual place with our outdoor magazines. I am expecting Outdoor to remain in the newspaper location for a week.
As a 70s fan I couldn’t help but put the latest issue of Collect it on display in our newspaper stand. While I am not a regular reader of the magazine, the 70s theme got me browsing the title. This is why I decided to give it a high traffic area placement rather than leave Collect it in its usual place where only those interested in collectibles would look for it. This is a perfect example of making a placement decision solely based on the cover. Hopefully I am right and impulse purchases flow.
Newsagents can expect a sales lift today with more people out and about voting than the usual Saturday traffic. We notice a lift every election day.
Newsagencies closer to polling places can do especially well with a good offer pitched to passers-by.
I have no interest in selling a calendar with a margin of 25% to 35% when I can sell a very similar calendar with a margin of 60%. Take the Family Planner 2011 Calendar which we received this morning from Network Services. We returned 88% of what we received last year yet Network still sent close to what they sent last year. I didn’t want this title at all, not at the margin they supply it for. It does not pay its way. So, we early returned the stock this morning – as we will do with most magazine distributor supplied calendars.
Calendar publishers who want to supply newsagents need to find alternative routes to market which respect the value of the retail channel by delivering a better margin.
In a few seconds I created two new ‘newspapers’. The first, a newspaper based on tweets about the Australian Federal Election, aggregates content based on Twitter content published with the #ausvotes hashtag.
Talk about citizen journalism – well, in short form at least. Using paper.li it took just a couple of minutes to create. Click on the image to see a larger version of this morning’s ‘edition’. Down in the bottom right corner is a tweet of mine from just before I created the ‘newspaper’. I’d note that I created this edition this morning at around 6am. There was not much Twitter activity except from tweets from the parties. For those who enjoy comment from a diverse pool, check out the feed as the day unfolds. Last night election related tweets were flowing at up to 50 a minute.
I also created a Mark Fletcher newspaper based on Twitter users I follow. This is pretty cool as it draws content from a range of sources which interest me. Anyone can do this based on Twitter or Facebook feeds.
Paper.li is a very nice way of aggregating content from a range of sources through an interesting platform. It is when you look at tools like paper.li that you can start to make sense and use of the flood of tweets on a particular topic.
A defence department decision to decommission 395 houses at the RAAF base in Winnellie in the Northern Territory rocked the owners of Winnellie News and other retailers nearby. That the decision appears to have been made five years ago but not discovered until just a few months ago means that they have invested in the future of their business without the full knowledge which out to have been available to them.
The outcome of the election is important since the Coalition has said that they would turn the houses into a new suburb. This is not only important economically but also socially driven the chronic shortage of homes in Darwin. I understand that at this stage, the Labor party does not plan to retain the housing.
When I heard about this issue yesterday my heart went out to the newsagent. I wish we had heard about it earlier in the campaign. I am sure that other newsagents would have wanted to support a fellow newsagent facing the loss of their business in these circumstances.
I am surprised that the ANF did not take up this issue as it goes to the core of the community of newsagents, regardless of membership status.
For more on this story, check out the Winnellie News blog.
Thirroul Newsagency has just been awarded a Healthy Cities Award for its pioneering decision to ditch plastic bags in favour of environmentally friendly paper packaging. What a great story of leadership on environmental issues from a local newsagent. Well done Thirroul Newsagency!