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

Melbourne Observer powers along

fhn_observer_jun09.JPGThe Melbourne Observer is one newspaper trading against the trend in our experience of weeklies.  Our sell through rate is consistently above 90%, 40 copies a week or more.  Observer customers are likely to buy Take 5, That’s Life, crosswords, People’s Friend and or the Australian Women’s Weekly.

What I like most about the Observer is the loyalty of the customers and the loyalty of the publisher to newsagents – they regularly promote newsagents in the newspaper.  Their loyalty is something on which we can bank and build.

Newsagents with an older demographic should consider stocking this title.  Place it near your newspapers.

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Newspapers

Gold Coast panache magazine partners with newsagents

gold_coast_panache.jpgThe publishers of Gold Coast Panache Magazine know how to get the attention of newsagents.  A colleague has let me know that instead of making 25% commission from the current issue, newsagents make 100%.  I’d expect most newsagents carrying the title have it in a good location from which to achieve an excellent sales result.  The newsagent offer coincides with upgrading of the title from a stapled to a perfect bound finish.

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magazines

Amazon Kindle sells out in three days

Amazon started shipping the latest version of its Kindle reader late last week.  All initial stock was sold out in three days according to Information Week.

While note avauilable here, the buzz is building demand for the Kindle or similar devices here.  I’d expect the eventual launch to be like the iPhone which was delayed in reaching Australia.  The market will explode.

Click here for a review from Cnet and suggestions on how to make the Kidnle better.

Click here to see the magazines Kindle owners can subscribe to.

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magazine distribution

Newsagents act on Quadrant magazine

Newsagents are taking action against Quadrant magazine and its shoddy treatment of these small business owners used for the retail and distribution of the magazine.  I have heard from many who are now refusing to carry Quadrant on their shelves.  Some are writing to the Chairman of the Quadrant Magazine Ltd Board of Directors – Elizabeth Prior Jonson.

We are used to publishers spruiking subscriptions in the pages of magazines they sell.  Quadrant goes beyond spruiking in the latest issue of the magazine – they put down newsagents.

Quadrant, like around 65% of the magazines newsagents sell, is cash-flow negative for us.  It is a titled we carried (literally) to support range. I suspect they will soon discover the cost of their public ridicule of the newsagent channel.

FOOTNOTE: The last maagzine to so blatantly attack its retail partners was Fisherman & Boatowner in 2007.  See what I blogged back then.

UPDATE (1530): Crikey.com.au covered this today.  Hopefully it brings more attention to the issue.

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Ethics

Green magazines doing well

greenmags.JPGThe ‘green’ magazine section we created in our home and living category around two months ago is driving good sales.  Last week, we had one customer buy four of the titles we have on display.  Discussing her purchase, she made it clear that having the titles together and in this location were key factors in her buying all four.  What she discovered in our newsagency and our interest in her purchase has provided good word of mouth material to reinforce the value of a newsagency for special interest magazines.

These are small yet important decisions we can make in our newsagencies – grouping titles together to connect with interests we know exist which are not represented in the traditional magazine department layouts publishers have pitched to us in the past.

The key to what we have done with the ‘green’ magazines is to bookend the column with related and popular magazines.

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Environment

Promoting free Avon lipstick with InStyle

fhn_instyle_jul09.JPGWe are promoting InStyle magazine at the counter and featuring the gift of Avon lipstick valued at $22.99 which comes with every copy.  The offer will suit our customers and is likely to be successful in this impulse location.  Receiving a good mix and quantity of  marketing collateral is key to creating a display which drives the sales result we want from InStyle.

Before people say they did not get the free Avon lipstick, this is not a promotion being run with all newsagents.

For years we used this counter location for a selection of magazines, and a hotchpotch of other things you often see on a newsagency counter.  Once we pulled it back to promote a single title we achieved greater success with the benefit of being able to track the single item we feature.  Hence our certainty over promotions like this week for InStyle.

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magazines

Promoting Ralph

frank_ralph_jul09.JPGWe are promoting Ralph magazine in the body of our newsagency in Frankston with a prime location feature display.  Ralph sells well here and this great looking display (using excellent collateral from ACP) created by our team should work a treat for us.

fhn_ralph_jul09.JPGAt Forest Hill, Ralph magazine does not do so well.  To attract new customers we have a display at the exit of the men’s magazine aisle.  We have added soe other titles to create a small browse area.  We have found this approach works well for us with other titles.

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magazines

Quadrant magazine screws newsagents

qadrant_newsagent.JPGInside the latest issue of Quadrant magazine, the publisher blatantly disrespects the newsagents who are crucial to its business model.  here is what they say:

If you bought this magazine from a newsagent, you are missing out on a lot.  Subscribers get so much more.

This paints newsagents as expensive, unable to provide the benefits of subscription and a place where one misses out.

We don’t ask to sell Quadrant.  The publisher chooses to use the newsagency channel, to access our real-estate, to use our labour.  They do this because it helps them sell magazines.

While Quadrant magazine Ltd is not the first publisher to pitch for subscriptions in magazines sold in newsagencies, they are in a small club of publishers who disrespect newsagents by putting newsagents down in their subscription pitch.

I have removed Quadrant from the shelves and returned the title early.  I have cancelled future supplies.  Until the publisher respects what newsagents offer I see no reason to have this title in my newsagency.

Do I feel screwed by Quadrant?  Yes.  Their clumsy marketing ought to result in newsagents taking the title off the shelves.

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magazine distribution

Promoting weekly magazines to passers-by

fhn_weeklies_jun15.JPGWe are promoting weeklies again this week at the front of our newsagency but this time with a bigger selection of titles.  We have also included two crossword titles because these sell well with weeklies.

Whereas last week we pitched Woman’s Day and New Idea alone on this display, we felt that a broader selection works better for us in this spot.

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magazines

Missing a poster for the newspaper

fhn_age_poster.JPGWith another generic poster supplied for The Age today we have decided to promote Women’s Health.  I refuse to put up a poster which reads: THE AGE ON SALE TODAY.  The Women’s Health poster promotes the issue out today – two magazines in one so there is good reason to feature this.

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magazines

No need for newsagents to rush software decision

POS Solutions are telling newsagents (through their blog) that they have 15 days left to access the 50% invetsment allowance.    With many newsagencies turning over less than $2 million, there is no rush – the 50% tax break is available until the end of this year.

To help reduce confusion, click here for details on the tax break (investment allowance) offered by the federal government from late last year and enhanced in this year’s budget:

The Small Business and General Business Tax Break legislation has received Royal Assent and is now law.

The business tax break, in the form of an investment allowance, provides:

Small business entities (turnover of less than $2 million a year):

An additional tax deduction of 50 per cent of the cost of eligible new tangible depreciating assets where the business commits to investing in the asset between 13 December 2008 and 31 December 2009 and first uses the asset, or installs it ready for use, or (in the case of new investment in an existing asset) brings the asset to its modified or improved state on or before 31 December 2010.

Other business entities (turnover of $2 million or more a year):

  • an additional tax deduction of 30 per cent of the cost of eligible new tangible depreciating assets where the business commits to investing in the asset between 13 December 2008 and 30 June 2009 and first uses the asset, or installs it ready for use, or brings the asset to its modified or improved state on or before 30 June 2010.
  • an additional tax deduction of 10 per cent of the cost of eligible new tangible depreciating assets where the business commits to investing in the asset between 13 December 2008 and 30 June 2009 and first uses the asset, or installs it ready for use, or brings the asset to its modified or improved state between 1 July 2010 and 31 December 2010.
  • an additional tax deduction of 10 per cent of the cost of eligible new tangible depreciating assets where the business commits to investing in the asset between 1 July 2009 and 31 December 2009 and first uses the asset, or installs it ready for use, or brings the asset to its modified or improved state on or before 31 December 2010.

While I would not ant to get in the way of newsagents who want to improve business efficiency through an investment in technology, I’d suggest that there is no need to rush unless your revenue is above $2 million (retail sales plus agency commission).

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newsagent software

Catch Magazine shows off the benefits of the digital magazine

Catch Magazine, a digital magazine for fly fishing fans, is an excellent example of what can be achieved in the digital format compared to print.  Besides visually stunning content, they are using the medium to provide readers and advertisers a level of engagement which commercially valuable as well as entertaining.

Catch Magazine is an excellent example of how magazine distribution is changing.  The barriers to entry for new publishers are lower than ever.  There is little or no distribution cost.  No wastage.  Engagement, readership and advertising responses, thoroughly tracked. The environment story is strong – Catch Magazine: keeping trees vertical is a compelling pitch.

I’d encourage newsagents to take the time to click on the link above, read an issue of the magazine and then pick up a fishing magazine from your shelves and compare the experience of the two.

I understand the appeal of having a magazine in your hand to read anywhere you want without needing power or a clunky device.  I also understand the appeal of having access to content like that at Catch Magazine for no cost and available on my laptop or iPhone or other device – free.

There are interest categories which are logical for a digital platform.  A while back here I wrote that special interest categories appear to be insulated from the magazine downturn.  I am now seeing evidence that this is not the case.  More titles on digital platforms will fan this.

Our businesses are locked into the print medium.  The excitement is around the digital medium.  We need to change our businesses to be more physically flexible so that we can embrace change opportunities.

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magazines

Aged news versus real news

Why is aged news better than real news?  This is one of several fascinating questions posed by Jason Jones to the Assistant Editor and other representatives of The New York Times in a report produced for The Daily Show on TV last week.  Watch it…

The Daily Show With Jon Stewart Mon – Thurs 11p / 10c
End Times
www.thedailyshow.com
Daily Show
Full Episodes		 Political Humor Newt Gingrich Unedited Interview
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Media disruption

Attracting Dick Smith shoppers

fhn_dicks_gifts.JPGWe have a new range of gifts on display in our window.  The display has been created to be seen by people as they leave the new Dick Smith store opposite our newsagency.  The display does not have much height as we do not want to block the view behind the display, into our card department – another decision reflecting being opposite Dick Smith.  Our thoughts are that we need to be smart in trying to attract Dick Smith shoppers into our business.

We purchased these items in the display especially for expanding our gift offer and doing so at premium margin – we bought them at a considerable discount.

In selecting gifts, we are focusing on popular card categories for our core buying inspiration.  We know from our gift shops that gifts require consistent attention, more so than almost any other department in a newsagency.  Hence our small steps in moving into gifts in this business.

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Gifts

O’BON journals drive sales

obon2.JPGThe O’BON journals, pencils and folders we have are selling well.  Our customers like the environmental story. The journals are made using sugar cane pulp and the pencils are made from recycled newspapers – yes, an excellent like to one our core products there! The good environmental story with O’BON is enhanced by excellent product design and finishing – our customers comment on this.  While the O’BON range is sourced and recommended by newsXpress, I am sure that other newsagents wanting to carry an environmentally friendly and visually appealing range of journals, pencils and folders could arrange supply.

I have written here for some time that newsagents need a stronger presence of products which are more ‘green’ the O’BON range meets this requirement and goes beyond because of product design and quality.

For the record, no one has asked me to blog about this.  I have had the product in store for more than a month and was reviewing sales numbers yesterday.

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Environment

Promoting Cross Stitcher magazine

fhn_crosstich_june09.JPGWe are promoting Cross Stitcher magazine at the counter over the weekend.  While this is a higher priced title for which to chase impulse purchases at $12.95, the free thread sorter gift with this issue should be appealing to people into cross stitching.  I also wanted to see whether a special interest title like this can work at the counter.  So, we are playing.

Before anyone points out that we are promoting an imported title when we could promote an Australian title, I looked at our numbers for cross stitch titles and weighed up the factors for impulse purchases – value (gift), popularity and how the title presents in this type of display.  For our business, with what we have available this weekend, the offer Cross Stitcher magazine is the best I can see for us this weekend.

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magazines

Moving the magazine display on

fhn_madison_june09_b.JPGWe moved our Madison magazine display on today, it has done okay but we wanted to try the counter space for something else over the weekend.  Rather than move Madison completely back to its usual place, we have the title on display among the weeklies – for the weekend.  Just after moving Madison this morning, I saw one copy browsed and purchased by a shopper after picking up Who.  We try and always move a featured title to a secondary good traffic location before moving it back to its regular place.

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magazines

Ads on the cover of magazines

The New York Times has an interesting story about cover ads on magazine covers, Popular Science in particular.  This is interesting to me because of the use of ads stuck on the mastheads of some newspapers here.  I was interested to read that they have rules:

Ads on covers violate rules set by the American Society of Magazine Editors, which requires a clear separation between editorial space and advertising space.

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magazines

Apple move to grow magazine and newspaper subscriptions

The announcement this week of in-app commerce is game changing for newspaper and magazine publishers.  Where previously they, directly or through a ‘distributor’ could sell a product to be delivered through the iPhone and would need to sell another for the next issue or subscription, using in-app commerce, they will be far more easily able to sell the next issue or subscription.  This means there is less likely to be the churn of the current approach.

Newspaper publishers understand this.  Churn at the end of a home delivery subscription is a huge issue – as high as 50% with some subscriptions.  This is part of the reason the Advertiser announced their plans to take over management of customer accounts in Adelaide.

In-app commerce will help newspaper and magazine publishers reduce churn and therefore find delivery in the iPhone even more appealing than physical world distribution.  The new facilities enable offers to be more precise, personalised, to individual subscribers.  This is where it gets to be very smart.

Why does this matter to newsagents?  It is another reason for our suppliers to look at this rapidly growing channel which shrinks the supply chain.  A publisher / consumer relationship where the iPhone is the access point does not need a printing plant, a distributor, trucks, newsagents and returns handling facilities.

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magazines

The smaller format newsagency

I noticed reports that JB Hi Fi announced that it will open around 50 smaller format stores.  This is an interesting move.

Newsagents face a challenge around size, especially in shopping centres where landlords tend to want us to take 250 square metres and more.  If we take that size of space we need a broad offering attracting considerable traffic. With little of what we sell (today) unique to us, 250 square metres of retail space is a lot for a small business to maintain at the edge of competitiveness.

My view is that we are better off with smaller format newsagencies in shopping centres, between 100 and 150 square metres, and more narrow and specialised in focus.

A smaller format newsagency is more likely to have a genuinely unique selling proposition – with less space to manage, the challenge to harness this is easier.  Also, with less space from which to achieve a return, newsagents are likely work this more efficiently than in a larger format store.

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newsagency of the future

Newsagent unity opportunity missed?

It seems that newsagency industry politics is about to get messier with a new split emerging between the ANF, QNF ,NANA and VANA.  All four newsagent associations were actively talking behind closed doors.  It appeared progress was being made.  As the ANF advised newsagents Wednesday, a presentation was made on May 13.  This presentation to the ANF, lead by VANA, was based on a document prepared by VANA – The Way Forward 2009.  Click here for a copy of this document.

While convoluted and unclear, the document was presented to the ANF as a starting point by VANA, NANA and QNF.  The three state associations has reached broad agreement on key elements of the document.

Following the presentation, the ANF undertook to consider the proposal including that ANF Board to resigns and the handing back by the ANF of newsagent members to state associations.  These two points are an agreed requirement of VANA, NANA and QNF.  I have been told this by several people including someone close to the preparation of the document.

My understanding is that if the ANF agreed to these two key points, the states were set to agree and much sought political unity for newsagents would be a big step closer.

The bulletin published by the ANF Wednesday indicates, from my understanding, that agreement on moving forward has not been achieved.  It has been put to me by people involved that the ANF statement does not present all of the facts.

Newsagents want transparent and honest representation on issues that matter to them.  I don’t think they want spin.  Nor do I think they want representation mixed up with commercial activity as this clouds judgement on representation issues.

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Newsagent representation

Relaying wrap, chasing change

fhn_wrap.JPGOur team at Forest Hill relayed our wrap wall to refresh the offer.  This is on the wall bordering our card department.  While is is too early to say if it will result in a sales kick, there is anecdotal evidence suggesting it is attracting more shopper attention.

The work on the walls reflects a mission at Forest Hill to regularly refresh departments which are usually set-and-forget in newsagencies.

We know from US and UK retail study that refreshing the wrap offer in terms of location and range regularly – at least yearly -drives good growth.

Year on year, newsagents account for 35% to 40% of total card sales in Australia.  Our channell’s proportion of wrap and packaging is considerably smaller.  I think this is because we tend to treat wrap as the poor cousin.

By moving wrap and packaging around our goal is to find customers and help it achieve the potential we know is there.

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giftwrap

Visual merchandising inspiration

deceptionbay_brides.jpgClick on the image to see the detail of a new June Brides display created by Alexandra Carey at newsXpress Deception Bay. This beautiful display brightens the shop and enhances the experience. This is another excellent example of using the display to separate the newsagency from more traditional magazine displays.

shopfront_poppies109.jpgClick on this image to see how they represent the bridal theme in the shopfront facing into the shopping mall.  This is a significant departure from the traditional newsagency shopfront and seeks to make the business more appealing and reflecting a commitment to embracing gift and seasonal opportunities.

deceptionbay_babies.jpgClick on this image to see the new June babies display in the same newsagency.  Both displays are up at the same time.  Baby gifts are the most consistent performing gift category.  Creating a stunning visual display will deliver excellent sales results – as well as lift the visual appeal of the shop.

Both displays are an excellent example of making your newsagency your own.

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Newsagency opportunities
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