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

Where do customers look when browsing magazines?

flat_stack_magazines.jpgMost magazine publishers prefer their titles to be displayed on the flat stack- the flat shelf at the base of the magazine display.  It is the only place, in traditional magazine fixturing, where the whole front cover is on display. Publishers prefer this because they think this is where customers look.  Newsagents regularly receive bulletins from publishers and magazine distributors asking for this location.

Some publishers even go as far as asking merchandisers to move their magazines to the flat when in-store.  This creates tension in some retail situations – it is the retailer’s shop after-all.  (Merchandisers should not move stock without permission from the newsagent.)

My observations are that the majority of customers navigate to an area of a shop by what they see at or close to eye-level.  Once they are in the area they want, around 70% browse by what is in the fixture and 30% browse by the flat stack.

While this will vary from newsagency to newsagency, I think it is a mistake for p[ublishers to primarily focus on the flat stack when guiding newsagents as to product placement.

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magazines

Hallmark launches mobile greetings service

Hallmark has launched Hallmark Mobile Greetings in the US, for sending more creative greetings using mobile phones than a text message. The initial launch includes a small network of phone models in the US.  The company plans to make it available on the majority of mobile phone models and to permit messages to be sent from most major mobile phone networks to any other network.  each greeting is charges at US$.99cents.

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Greeting Cards

A good time to start a newspaper

‘This is a Fantastic Time to start a newspaper’ published by Gerson Lehrman Group is well worth reading.  Written from a US marketplace perspective, it argues that now is an excellent time to launch a newspaper.  The artline lists several reasons for this.  The last reason is the one which interests me the most:  Technology and innovation will change the business model.

We don’t see this in Australia yet, but it will come.  Our challenge is to be ahead of this wave by have alternative traffic generators in our businesses, shop firts which serve us and not one or two suppliers and an overall business model which leverages our position through the change with existing important suppliers like newspaper publishers.

The article is another call to action for it, not just about newspapers but about the newsagency model more broadly.

We start by cutting out inefficiencies in our businesses.  This means stopping some decades-old practices.  If a product or service is not profitable.  Stop.  No contract can force you to lose money.

We need to look ahead, over the horizon and not back at old practices.

We will make our own luck through this transition.

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Media disruption

Our July numbers

Our July numbers are show a healthy month, overall.  The sales numbers, compared to July last year are:  Art – up 14%; cards – up 9%, Gifts – up 200%, magazines – down 5%, Newspapers – up 6%, Ink – up 25%, Stationery – line ball.

There is good news inside the magazine department: food – up 7% (unit sales), men’s lifestyle – up 26%, music – up 15% (Michael Jackson), special interest – up 8%.  Women’s weeklies are down but our sales of these are choppy month to month.

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Newsagency management

Ducks and chooks attract customers

australian_poultry.JPGGiven the interest in my post last week about the chook on the cover of Burke’s Backyard magazine (Don featured chooks in his TV segment on ACA on Friday night BTW) I thought I’d write about Australasian Poultry.  This magazine is a good example of the special interest titles we sell in newsagencies.  These titles are important to us – they are our point of difference in the magazine department, they drive habitual sales and they are a growing category.  I know from postcode data that customers are prepared to travel further to purchase special interest magazines.  I know from basket data that special interest magazine customers are more likely to purchase more magazines.  There are two compelling reasons for us to embrace the special interest segment.  This is why I am expanding selected categories.

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magazines

Ben 10 TV Ad drives traffic

ben10_partwork.JPGThe TV campaign for the Ben 10 partwork must have started based on the traffic beating a path to our doors yesterday.  We’re at a 75% sell-through already and it is less than a week.  We are capitalising on the opportunity by placing the product, for the weekend, at the front of the shop – to draw kids in with mum or dad in tow.  Some of these kids also pick a pack or two of AFL footy cards while mum or dad purchase something too.  This is how to make money from the early issues of these traffic generating partworks.

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magazines

Newsagents should visit Melbourne Gift Fair

Newsagents in Victoria should take time out of their businesses and visit the GHA and Reed Gift Fairs in Melbourne starting today and running through to Wednesday.  You will see product allied to what is sold in newsagencies today as well as many completely new lines and categories.  I was talking with the GHA (Gift and Homewares Association) yesterday and they confirmed that the number of newsagents attending these fairs increases each year.

Gifts are a fast-growing category for newsagents.  I have seen newsagencies go from $10,000 in sales from gifts in 07/08 to $40,000 in 08/09.  The margin, depending on your buying and pricing policy, is usually around 50%.  The key to success is careful buying and knowing your customer – oh, and that you may not be your customer.

It is also important to have a price management policy – knowing how long you want to hold an item and how you transition the item through price points to move the stock.

I know a bit about the fairs because my software company, Tower Systems, exhibits.  This year, like last, we are at the Showgrounds location.  We find it worthwhile because of the number of newsagents attending and because of our growing gift shop customer base.

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Gifts

Preselling the Official Michael Jackson Calendar

michael_jackson_calendar.jpgWe are pre-selling the Official Michael Jackson 2010 calendar.  Customers are reacting well, we have good orders in ttwo of our stores.  There is no resistance to the requirement for a chunky deposit or the terms associated with the offer.

This is a great way to lock-in business in advance of a hot product being launched, before others flood the market with Michael Jackson themed calendars.  Right now, this offer is exclusive to us.

The idea of the pre-sell is a newsXpress initiative.

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Calendars

Making gift selling easier

pre_wrapping.JPGWe are playing with selling pre-wrapped gifts, to make our offer more appealing to time poor customers.  The wrapped boxes of the photo tree (see photo) looks more appealing in its wrapped form than the tree standing alone.  We have a numbers of gifts pre-wrapped in this way and will expand if customer support is strong.  This is in addition to our work with gift hampers.

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Gifts

Magazine subscriptions from online sources grow

Newsagents concerned about newsagencies being used to harvest new print magazine subscriptions should read an article published yesterday by BtoB which reports that US magazine subscriptions originating from the Internet are predicted to grow 22% according to a survey of publishers.

Print magazine subscriptions originating from the Internet are anticipated to represent 22% of new business sales among Magazine Publishers of America members, according to an online study the association issued earlier this week.

Publishers in Australia continue to ignore an opportunity to work with newsagents on a more structured approach to subscriptions.

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magazines

Promoting food magazines

fhn_food_july312009.JPGWe are enjoying success with food magazines so we decided to leverage this with a display at the front of our newsagency, where people entry to purchase lottery tickets.  We have have included a selection of titles from the Better Basics (which is almost sold out) to the monthlies and a selection of ACP Cookbook titles.

We will leave this display up for the weekend and assess its value to us on Monday.  We like to change this display at the front of the newsagency regularly as it is a window on the business.  We choose the categories to promote based on sales movement we see.

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magazines

VTAC Guide out now

fhn_vtac_2009.JPGThe VTAC Guide went on sale in our newsagency this morning – an in newsagencies across Victoria.  We have a display next to our main newspaper stand – it will remain here for a couple of weeks.  We are opportunistically chasing impulse business in addition to destination business for this title – hence the prime location placement.

The cover of the VTAC Guide has excellent visual cut through, better than recent years.  This is another reason for prime-location placement. We are expecting good sales.

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magazines

Looking for money in That’s Life

money2.JPGIn the rush of the Powerball jackpot yesterday I noticed a customer working through each copy of That’s Life we had on display, looking for copies which had cash – as part of the weeks giveaway with the magazine this week.  My initial thought was to go and ask her to stop.  However, I decided to not approach her until it became a problem for other customers.  She was not damaging the titles and was careful about putting them back neatly.  Also, I did not know her financial situation.  I reasoned that if I stopped her I’d need to take action on the many browsers we see each week reading magazines.  I don’t want to be that newsagent who barks at browsers.  I like people reading magazines and enjoying our retail space while they do it.

Thinking about it now, I’d like to know her story.  It’s a brazen and potentially embarrassing thing to do – to hold the money wallet to the light looking for a note.

It is amazing what you see in a newsagency some days.

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Customer Service

I found a bagged magazine customer!

I know I go on here about bagged magazines (they are not browser friendly and waste newsagent space), especially the junk from Express Publications.  Yesterday, one customer bought three packs of bagged Express Publications magazines.  I asked her why.  They were for a gift and they knew the person liked crafts.  The purchaser was not into crafts – she said she had no idea what magazine was good or not so she went for volume.  I didn’t have the heart to tell her that one magazine was current the other two were ranging from old to ancient.

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magazines

Barnes & Noble moves on digital strategy

Last week, Barnes & Noble (reportedly the world’s largest bookseller) launched its digital book strategy.  This week, the bookseller launched free Wi-Fi in its stores.  These are significant moves by the bookseller – primarily against online store Amazon and their Kindle readers.

This latest move shows how serious Barnes & Noble are in pursuing the sale of digital editions of books.

Barnes & Noble, like all of us bricks and mortar businesses face the challenge of remaining relevant against online businesses.   Devices like the Kindle in the US and iPhone are changing how people access and consume content which they previously accessed in a printed form.

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Book retailing

Powerball $80 Million Jackpot day

Based on sales already this week, I expect today to be a monster day not only for lottery sales but also for other product we are pitching around the lottery offer.  We are most fortunate to have another opportunity like this so soon after the OzLotto jackpot and to have additional lottery kacpots to sell – like the Oz $20 million and the Saturday Lotto $20 million.

Gifts, magazines and books are all benefiting from the bonus lottery traffic.

Newsagent suppliers would be well advised to stay away today from newsagencies with lotteries.

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Lotteries

Some newsagent suppliers hold back sales

Some suppliers get in the way of achieving sales in newsagencies because of their rules about how and where they want their product displayed. I wish they would trust that I want what they want – their products sold as quickly as possible. Having a go at a newsagent because of a breach of the rules and with no regard to the sales achieved disrespects the role of the retailer.

It is extremely frustrating and demotivating to be treated as a process worked by these suppliers. They need to understand that newsagents have more financial risk in selling their products than they have as employees for the supplier.

Some days, I want to yetll, get out of the way and let me be a business person.

their excuse is that not all newsagents will do the right thing.  So, their response is to treat us all as the lowest level.  We miss out.  They miss out.

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Newsagency challenges

Railway Digest a hit magazine

railway_digest.JPGRailway Digest is bucking the trend of many magazines from what I can see.  Sales for this very special interest magazine are strong.  In our case, we have a sell through of in excess of 90%.  With a $9.00 cover price, Railway Digest is nicely profitable for us.  Our success is, in part, due to careful placement of Railway Digest along with all of our other railway magazines.

We discovered strong interest in this segment some years ago and were careful in placement and expanding the range.  Now, we have some hero titles like this one.

We use Railway Digest as a beacon for our other railway titles.  We do the same in other magazine segments, especially in special interest areas where we want to be known as the go to location.  Special interest customers will travel further to satisfy their interests.

So, despite the gloomy talk here and elsewhere about the challenges of magazines, there are success stories.  Newsagents are better placed to leverage these than any other magazine retailer.

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magazines

Lovatts crosswords tap into snuggies

lovatts_snuggies.JPGSnuggies are all the rage for people who actually like them to those who get a laugh from the how religious-sect like they look in the TV commercial.  Lovatts have tapped into the interest by offering Duvet Suits as prizes to competitions in their latest BIG Crossword magazine.  I see this as being a bit of fun and could help draw attention to BIG from those who may otherwise not look twice at the title.

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magazines

Hallmark card promotion popular

fhn_free_cards_jul27.JPGThe Buy 5 and Get One FREE greeting card offer we are running in association with Hallmark is proving to be very popular – considerably more so this year than last year.  Customers are delighted with the offer, a couple even headed back into the card department to qualify sooner for their free card.  Indeed, the customer reaction is most encouraging.  Like any loyalty offer, the goal is to sell more product.

There is no point in rewarding customers for doing what they would usually do in the set period of time  – hence the importance of this being a limited time offer. This campaign runs five months.  We are chasing a good lift in card sales and from gift sales as a flow-on.

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Greeting Cards

The challenge for music magazines

fhn_musicmags.JPGSpinning in the Grave is an excellent article by Jonah Weiner on Slate.  Weiner focuses on music magazines and offers a useful perspective as he was a senior editor at Blender magazine until a few months ago. The article is relevant to newsagents because it thoughtfully assesses the changes impacting the segment.  Rather than saying online is taking over, Weiner presents reasons for the decline of music magazines.  I see the challenge in sales figures – the music category is experiencing a rocky ride.  Even free CDs and other giveaways are not driving sales as they used to.

New York Magazine covers this story too.  Be sure to read the comments at the end of their piece.

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magazines

Powerball 80 Million jackpot countdown

powerball_80million.JPGWe are making it easy to pitch the up-sell of the Powerball 80 Million jackpot with a menu of ticket options.  This is something to which we can refer in a sale including non-lottery items.  We point to the options when we ask if they would like a ticket in the draw, this lets them see the value of the question we are pitching.  Just asking if they want a ticket could be meaningless to someone who does not play powerball.  Sales reflect the success of the mechanic.

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Lotteries

Chooks as covergirls

fhn_burkes_jul27.JPGI like the front cover of the latest issue of Burke’s Backyard as it separates the title from other gardening titles.  So our customers can see the sexy chook cover girls we are pitching Burke’s Backyard at our newspaper stand and on the flat next to Better Homes and Gardens.  These cuties are lost in regular magazine fixturing.  Kudos to the folks at Burke’s for playing with the gardening magazine look like this.

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magazines