We have now sold three copies of the $16.95 Men’s Health DVD about which I blogged three weeks ago.  Our only promotion has been placement next to the parent title.  The sales are interesting in the context of consideraing a magazine price ceiling in newsagencies.

This photo shows how we are using the floor space saved from when the magazine fixture was removed two weeks ago. The new dance floor is currently home to a good boxed Christmas card display. Focus will change as the seasons move. What we have is considerably more flexibility than the old fixtures permitted.

While we are barely two weeks in, magazine sales appear to have been unaffected.

It is important that we look at space allocation in our newsagencies.  Return on floor-space is a good metric.  Given that cards have a margin which is three times that for magazines and, this time of the year, come close to magazines in sales revenue, the move is financially rewarding.

Having less magazine space has meant that we take more care with placement.  This is an outcome we wanted.  Too many magazine pockets makes us lazy – we do unnecessary waterfall displays to fill the space.  I see this in many newsagencies.  We now have fewer waterfall displays.

I may be too close to the changes to assess, but the magazine space feels energised from the changes.  Shelves are more full and this makes it feel more professional – if that makes sense.

Whereas previously we have the traditional long magazine aisles which ran two thirds of the length of the shop, we now have this open space where a magazine shopper gets to see more title facings.  It is like removing blinkers from the shopping experience.

ACP Magazines is pushing the free gift boundary with the watch attached to the cover of Cleo this month. It’s an excellent value gift and packaged without distracting from the magazine product itself.

We will sell out of Cleo I am sure.

What I am not so sure of is what this does for the magazine long term. Does it educate Cleo readers to expect more gifts? Does the watch get in the way of the new look product?

I have found slow growth the be more sustained in many areas of business and while some growth achieved with premiums like the watch sticks, I’d expect that more of the slow growth sticks.

The magazine circulation numbers released last week indicate the sales volatility for magazines which we see at our sales counters.  They also mirror what I have seen in the newsagent sales benchmark data and covered here.

Competition between publishers is more intense than I have seen in years.  The demands on retailer time and space investment are also higher than I can recall.  This is forcing newsagents to make decisions on which titles to support and which need to find their own success.

The key to long term magazine success as I see it is the product.  A good magazine has more chance of long term success than an average product which uses cover price and  free gifts – these drive sales spikes but, I suspect, not sustained growth.  A secondary key factor is providing newsagents with good information with which we can make better decisions about a title.

The collapse of Derwent Howard, publisher of a bunch of titles in Australian newsagencies, gets messier by the day.  Problems appear to have started with a shuffle between business entities with similar names – who employed people and published titles is a bit of a maze.

While on the surface, none of this directly affects newsagents, I’d note that we currently have stock from the company which is now under administration.  I’d also note that Network Services is a creditor with close to $900K owed according to The Australian today.  We are also likely to experience some bumps while titles move from publisher to publisher.