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

The frustration of new magazines

fhn_artist_profile.JPGWe received five copies of Artist Profile magazine from Next Media this morning. This is a new title for us. Some bright spark decided to risk our money, time and space in supporting this title.

This is the problem with the magazine distribution model. Newsagents, the bankers, are forced to provide credit to publishers and distributors, take the risk of theft and give up expensive space to support titles others think we should carry. Had I been given the opportunity to decide on this title I may have said yes.

That I was not given an opportunity says that my business acumen counts for nought. Publishers and distributors who complain that newsagents are not business people ought to think about this. Their actions often deny us the opportunity to be business people.

Publishers and distributors need us and they say they like and respect our channel. They ought to show us this through fairer and more inclusive actions.

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magazine distribution

600% supply increase fails

gameinformer_dud.JPGThe 600% increase in supply for Gameinformer magazine we received last month failed to result in a sales lift.  We returned 80% of supply today.  All this did was muck up our cash-flow.  The publisher and the distributor forced us to partner with them in their experiment.  Newsagents don’t have the financial or space capacity to support publishers wanting to grow sales by shipping more product to the retail channel.

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magazine distribution

Did newsagents play a role in the sales fall of Alpha?

Alpha magazine recorded the biggest sales fall in the six months to December 31, 2009 as reported by the Audit Bureau of Circulation and I wonder if newsagents played a role in this.

The 30.7% decline in sales is extraordinary.  It represents 30,000 fewer copies sold.

In April last year, Alpha changed its distribution and newsagent compensation models.  The 40% cut to newsagent income from the sale of Alpha hurt.  Many newsagents reacted by removing Alpha from the premium location next to newspapers and placing it with other sports related titles, usually toward the back of the store.

While we will never know if this action played a role in the steep sales decline, I suspect that it did based on the number of newsagents I heard from who wanted to make a point about their treatment over Alpha.

Read my blog post from March 28 last year for the back story.

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magazines

Who owns the iPad customer?

Ownership of the customer has emerged as an issue in discussions between publishers and Apple according to a report at FT online overnight.  I am sure this will be resolved, the iPad buzz and opportunity are too great for either side to let it stall as a delivery channel.

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magazines

Alice in Wonderland magazine offer opportunity

alice_in_wonderland.JPGThe magazine covers featuring Alice in Wonderland are providing us  a rare opportunity to promote titles together.  As the Empire and Lovatts Clue Words examples in my photos show, these covers need to be fully seen. Old magazine fixturing lets them down.

In addition to displaying these titles in their usual locations, we are placing them together.  Who knows, the Alice in Wonderland cover could attract someone to the title who would not usually purchase this. Once promotion for the film reaches full strength, I’d expect us to have five, maybe six, titles we could promote together.

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magazines

Visual merchandising ideas for newsagents

newsXpress is publishing photos almost daily of displays for key promotions.  Recently, it was Valentine’s Day.  Now it is Back to Work.  Newsagents looking for visual merchandising ideas from a variety of newsagents should check the blog out at www.newsxpressblog.com.au.  Anyone can visit – there is no login required.

Great visual merchandising displays attract traffic and drive sales.   They make the business look relevant, enjoyable and a good-value place to shop.

Disclosure: I am a Director of newsXpress Pty Ltd.

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Newsagency opportunities

The craft, quilting, cross stich, knitting and quilting magazine offer

craft_titles.JPGSomeone in a comment here asked me to post a photo of what our craft area looks like.  I forget the context, sorry.  The photo shows how the craft magazine display looked yesterday morning.  Looking at it now, it certainly needs some work to tidy segments and beacon brand popular titles.

Sales of craft related titles are not what they were a year ago.  We promote them from time to time outside their usual area with little impact.

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magazines

Promoting InStyle magazine at the counter

fhn_in_style_feb10.JPGWe are promoting InStyle magazine at the prime promotional location between two busy counter locations.  The free gift makes it a true premium offer.  The can of free dry shampoo spray which comes with the issue makes displaying in regular magazine fixturing a challenge so this display also helps out on that front.

We have placed Women’s Health next to InStyle since we expect them to appeal to the same customer.

Both magazines will remain in this location until the weekend when we will review the numbers.

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magazines

Promoting Unique Cars to male browsers

fhn_unique_cars_feb10.JPGWe have created the display promoting Unique Cars in the photo to face people leaving our men’s magazine aisle.  We also have a half waterfall display in the regular location for this title.

It is good to see Unique Cars getting some attention from the publisher.  I’d expect it to respond well.   It’s certainly a popular title with browsers.  The million dollar question is how do you turn a newsagency magazine browser into a customer?  We try with our magazine loyalty program and while this does have an impact, not enough convert.

This display for Unique Cars is trying for a second bite at the browsers, as they leave the aisle.   It’s a good location because there is little competition for visual attention at this point.

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magazines

Promoting Woman’s Day at the counter

fhn_wd_feb10.JPGWe are promoting Woman’s Day at two of our counter positions thanks to the free cookbook with the current issue.  We will leave this here for three days.  The free cookbooks usually drive good incremental sales.  Like othjer magazine promotions, we are doing this of our own accord and not because we are paid a premium for the space. The newsagency channel is valuable for publishers, more valuable than c-stores and supermarkets in this regard.

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magazines

High school and uni students suffer from Fair Work Act

Students are a valuable labour force for newsagents.  Newsagencies have been a valuable learning and income opportunity for students. The Fair Work Act is changing that thanks to the minimum hours provisions.

Consider the case of “Nick”.  For three years he has worked three nights a week, after school, for between and hour and a half and two hours.  The newsagency was on the way home.  He was happy with the work and the award wage he was paid.  Now, under the new provisions, he will have to be let go since he cannot be given the minimum hours as the business closes at 6pm and he cannot get there before 4:15pm.

This story is not unique.  I have heard from at least twenty-five newsagents of with similar stories, especially in high-street and regional situations.  I’d estimate that more than two-thirds of newsagencies employ students for short hours. While it is hard to give a number of students affected without surveying all newsagents, I’d estimate that more than 15,000 students would be affected.

The alternative is for the employment to be off the books.  However, that is dangerous.

The government says it has consulted business.  Clearly, they did not consult all businesses.  Maybe it should consult and work with newsagents and students to protect the current arrangements.  They were considered fair before these latest changes were introduced.

Footnote: My newsagencies are not affected since we configured our businesses some years ago to have minimum three hour shifts.  It suited us in our locations.

UPDATE (6pm): News Ltd columnist Andrew Bolt picked up on this today at his blog.

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Newsagency challenges

Radio wants their $240 million from the government

The Australian is reporting this morning that radio stations want the federal government to give them a handout as was announced recently for the TV networks.

We hear so often, from politicians of all persuasions, that small business is the backbone of this country yet we rarely receive government largess on the scale of the $240 million for the TV networks or the billions paid to auto makers.

The case put by the government for the TV handout does apply to radio.  It also applies to small businesses like newsagencies.  We have to invest in change for us to have a future.  I doubt our need will gain any traction with any politician.  We’re too small.

This is the kind of issue on which newsagents could use their critical mass to make a point.  Imagine if every newsagent had a petition at the counter for customers to sign or if we handed out a postcard to be sent to the local member.

If we could make a loud enough noise we would get on their radar.  I doubt we would do it.  Our biggest asset, our national footprint, is rarely used by us.

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Newsagency challenges

Trader TAG set to struggle to replace Trading Post

trader_tag.JPGTrader TAG is another wannabe replacement for the Trading Post.  At $1.00 a copy and being supplied through a distribution newsagent, the numbers don’t work for me.  Trading Post at least had a higher cover price and was supplied direct.  I can’t see Trader TAG selling what enough copies to cover the space it will take in our newspaper stand.  I expect we will say no thanks to this title unless the publisher aggressively promotes it and fixes the margin problem.

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Newsagency challenges

Wired for the iPad

Chris Anderson, the Editor-in-chief of Wired magazine said the iPad-native version of their magazine would be a game changer.  Electronicista has a report on this.

What will really drive interest in moves like this is a new pricing model, setting iPad content apart from print content.

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Media disruption

Sharing newsagency supplier rewards

wine_sharing.JPGWhenever we receive a supplier reward we share it with the team.  The latest kitty to share is four dozen bottles of wine, some beer and some movie passes.  We don’t make alcohol available to any employees under 18.  Those 18 or older get to choose their own bottles of wine – we line it up in the back room for selection as this photo from yesterday shows.

It’s important that everyone working in the newsagency understands opportunities like these supplier rewards.  By sharing what we receive we help them understand more about opportunities beyond the income the business received from selling items for which there are other rewards.

Occasionally, we will use rewards as customer gifts but not often as we have plenty of these throughout the year from other promotions.

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Newsagency management

Strong Valentine’s Day sales

We achieved excellent numbers across the various stores I am connected with yesterday for Valentine’s Day related product.  While cards were at the core of the success, gifts and chocolates performed very well too.

In each situation, sales were ahead of last year.  Curiously, the two locations which performed the best are loacted in areas of considerable social and economic challenge.

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Greeting Cards

Diabetic Living display a hit!

Our Diabetic Living display at the counter is driving an excellent result with 40% of our stock sold in three days.  This is ahead of the sales we usually achieve in the first three days of on-sale.

Not every magazine reacts this way to placement in this premium location.  The key is to learn which titles work well here and which do not.

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magazines

Would you take firm sale magazines?

In a discussion with a small publisher yesterday they asked whether newsagents would take their products on a firm sale basis in return for 45% commission.

This is becoming a more common discussion point in the smaller publisher circles as they look for ways to break free from the traditional magazine supply model.

In addition to the firm sale commitment, they would be looking for guaranteed placement – not so much in a premium location, but certainty as to location of their title.

While the 45% is good progress, I would like to see a margin of more than 50%.  This would make the title very interesting.  Oh, and not a one off based on a sales stretch like with the latest issue of Cosmos but permanently in return for firm sale and placement guarantee.

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magazines

Nightline report showcases the Hallmark brand

ABC’s Nightline program last night in the US ran an excellent report on Hallmark Cards.  Starting out about Valentine’s Day cards, the report went behind Hallmark and provided perspective on the company responsible for more than half all cards sold.  The story also covered Hallmark innovation – something we are benefiting from with the Hallmark sound cards. Here is the Nightline story:

This report reinforces what I write here about brands.  Hallmark is a respected brand.  While anyone can produce a greeting card, Hallmark owns the feelings of respect, trust and innovation associated with their brand.

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Greeting Cards

Promoting the Susan Boyle book at the counter

susan_boyle_book.JPGWe have made space at the counter to promote Susan Boyle, Living the Dream at the counter.  We are confident that this book will appeal to our customers at Forest Hill.  To drive sales, we have the book priced at $19.95 as we felt the list price of $24.95 was a bit high.  While I expect the majors to undercut us, our price should be close enough.

I am am pleased that newsagents were offered this book and that it was for more than the usual magazine margin.  While the book is not for everyone, being given the opportunity is always welcome.

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Newsagency opportunities

Pitching Valentine’s Day

valentines_gifts.JPGLike most newsagents, we are pitching Valentine’s Day with promotions for cards, chocolates and gifts.  Most of the gifts we have chosen will fit in our gift department after the day is over so the risk is not that great in terms of product selection.

What surprises me about Valentine’s Day is that few magazines engage with the opportunity.  I’d say we have no more than four titles with any coverage worthy of display with Valentine’s Day gifts.  Maybe publishers don’t see the opportunity.  I’d certainly like to play more in this space along the lines of gifts which are guilty pleasures.

One idea I had for a monthly would be a wraparound cover which can be removed after Valentine’s Day.  This could see the title promoted in advance of the day with a Valentine’s Day pitch and then revert to the more traditional pitch after.  Yes it would be some work but it may also help drive sales.

Sales for Valentine’s Day have been okay.  The next three days are the key of course.  I read somewhere that 75% of Valentine’s Day cards are sold in the last 48 hours.

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magazines

UK magazine numbers make interesting reading

Men’s Health in the UK is the number one title in the men’s magzines category in figures reported in The Guardian yesterday.  At 250,577 copies it is 20,000 ahead of nearest rival FHM.

The interesting trend out of the UK is the decline in what they call lads’ magazines.

The lads’ weeklies Zoo and Nuts suffered the biggest year-on-year declines for the second successive ABC period. IPC’s Nuts retained third spot among the paid-for titles, despite a 24.4% decline to 176,835, down 6.2% on the previous six months.

I think we are seeing this here, certainly in stores I am connected with.  The men’s health, fitness, bike and sports magazines are either holding their ground or growing while the lads’ magazines are static or falling.  Maybe this is because of a shift in buying patterns.  This would not surprise me as more people learn to buy magazines with fuel and convenience purchases elsewhere.

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magazines

Finding Trailzone magazine

trailzone_cover.JPGI like their reproduction of the Trailzone masthead on the bag they produced for the magazine.  While I am not a fan of bagged magazines, at least they have ensured that people looking for the title can find it on our shelves.  The publisher’s effort shows that they understand retail.

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magazines

Fighting Streetfighters

streetfighters_coverup.JPGA merchandiser representing Streefighters magazine visited, moved the title to a better position and put in a header card.  All for the one copy we were sent.  I’d accept this intrusion if they paid for the space but they don’t.  I choose which titles get premium space based on the revenue they generate as well as the opportunity for additional revenue.  Merchandisers are supposed to get permission before they go and make changes like this.

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magazines
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