Gannett, publisher of the 138 year old Tuscon Citizen newspaper, has announced that today’s edition will be the last. The brand is moving to an online only model. While the circulation was only 20,000, the closure continues a trend this year and has generated mroe speculation on the future of newspapers in the US.
Newsagents are better retailers of magazines and newspapers than supermarkets and some other retailers.
Newsagents offer broader support of the category – more than good placement. We are less demanding when it comes to costs such as shelf space, marketing subsidies and other costs of business. We add value through a range of magazine related services like co-location, beacon branding, loyalty programs, category promotions and other initiatives.
I would like to see publishers respect the service newsagents provide by reducing their use of other retail outlets. Help us reinforce our position as magazine specialists. If developed professionally and executed co-operatively such a strategy would improve newsagency foot traffic and increase customer spend on magazines.
Publishers think that by making a product ubiquitous it is easier to purchase, more likely to be purchased. I’d suggest the opposite is true. People can think that they will have other opportunities to purchase a title and some end the week or month having not done that. Also, seeing a title everywhere may blind people to it – that’s what I wonder.
Reducing retail outlets gives us an opportunity to build healthier businesses around newspapers and magazines and, as a result, invest more in the category. The return for publishers would be greater effort from the specialists.
I am not about to lay out my plan here but I would note that today’s conditions offer an excellent opportunity to build magazine sales based on respect of magazine and newspaper specialists rather than driving competition through more outlets.
There are proactive newsagents keen for such an opportunity.
Our Tattslotto syndicate sales have been strong for the $20 million superdraw tonight. Regulars and newcomers to syndicates have delivered excellent sales. I felt we needed a larger prize to entice people. I was wrong. Our team has done a great job promoting syndicate sales.
newsXpress in partnership with Golden Casket ran two large syndicates through newsXpress outlets and both easily sold out.
Clearly with the right in-store pitch and products through which to engage customers are happy with a $20 million first division price pool.
The Combat Tanks Collection partwork is generating good traffic. The TV campaign running currently is having a positive impact. We are promoting the title at the front of the shop to also get to people who have seen the ad but have forgotten to purchase it. We are also pushing putaways for people likely to want to collect the series.
The Combat Tanks Collection is an excellent opportunity for newsagents as we have this exclusively.
Regulars here will know why I like partworks. Partworks customers are more likely to purchase other items when visiting to collect an issue than a regular magazine customer.
The government owned Australia Post shop opposite our newsagency at Forest Hill is offering 50% off all greeting cards until May 31. They are promoting this in the window and in-store. If this were any other retailer I would not be concerned. That it is the Government owned post office with access to various privileges associated with such ownership and that they are so blatantly targeting an independently owned small business is appalling behavior.
This 50% off card deal is not just at our location.
We sold one copy each of the latest issues of Better Digital and Digital Photography and Design magazines Their single-digit sell-through rates make them among the worst performing titles in my newsagencies. I put the poor sales down to over-satisfaction in the segment thanks to other titles and that more up to date informatiuon on digital photography is available free online. The publishers of these titles need to urgently get a hold of current sales data from newsagencies and review print runs accordingly. We cannot afford sub 10% sell through rates. They could also consider engaging in a marketing campaign to drive trafffic to the titles. While there is a cost for such marketing, there is also a cost for newsagents to have this stock sitting idle on their shelves.
Sales of Yachting World magazine are falling yet the magazine distributor has seen fit to increase our allocation. I cannot understand how they justify an allocation increase with a poor sell-through rate. As these things usually go, the publisher will blame the distributor and the distributor will blame the publisher. All I know is that my supply has been increased without justification. If only I had the same control over the distributor when it comes to cash flow!
The latest issue of WHO features 12 stars without make-up. This is an annual feature published by WHO. Given the news coverage this is likely to attract and the interest in the non-retouch issue of Dolly, we are featuring WHO next to the Herald Sun in our main newspaper stand. We will leave this in place through the weekend and assess sales Monday. Topical features like this provide an opportunity to reacquaint customers with a title like WHO.
Note the use of the old Alpha magazine stand.
The coat of arms on the masthead of The Age newspaper today is covered up with a stuck on ad featuring a mouse-like finger. If the coat of arms is deemed by the advertising and accounting teams to be of little value why have it on the front of the newspaper every day?
The matter of ACCC v Bill Express & Ors has been set down for a trial before Justice Finkelstein commencing on 10 August 2009. A pre-trial conference has been listed for 11.30 a.m. on 22 July 2009.
Here is the text of a news release from the National Federation of retail Newsagents website about the treatment of newsagents by News International in relation to proposed new contracts:
LONDON DISTRICT QUESTIONS NI’S DIRECT TO RETAIL TERMS AND CONDITIONS OF BUSINESS
An emergency meeting was called by NFRN London District President Omkar Patel yesterday in order to review the imposing Retail Terms and Conditions of Business posted out to London and Birmingham newsagents during last week.
Despite increasing requests from News International over recent months in wanting to work more closely with independent newsagents and the NFRN, it is clear that News International have formulated the new Terms without any consultation or prior presentation to the NFRN. The resulting four pages of Conditions – together with a stinging tariff of administration charges – clearly looks to impose a draconian trading relationship with its retailers.
Omkar Patel said: “It is crystal clear to us that News International is driving a dictatorial relationship with its newsagents on everything from holding deposits for the lifetime of trading with NI, mandatory weekly payment of account, incredible charges of +3% above Bank of England base rate for non receipt of payment on the day and all this even if the invoice sent to you is massively inaccurate due to missed returns and voucher credits. And if NI wants to change any of its terms with retailers they simply promise to give you just 7 days notice!”
Mr Patel said that the NFRN will urgently engage with News International on a fifteen point agenda that will aim to clarify, modify and provide a more balanced and positive direct trading relationship with the Publisher. “It is absolutely critical that News International listens to our point of view very carefully if it is to truly support the positive sales of its newspapers through our members,” Mr Patel emphatically stated.
While there is a considerable difference between the newspaper distribution models in the UK and Australia, it is appropriate that Australian newsagents are well informed on moves by News in the UK.
In our gift shops we have sheeted wrapping paper behind the counter. It is attractive and commercially viable in this location. Sheeted wrapping paper is possibly something that could work in newsagencies rather than the usual behind the counter product mix and clutter.
We change the paper to match fashion trends as well as for key seasons. It is surprising the number of customers who present at the counter and purchase paper on impulse based on what they see on the wall behind. Above the paper we have a selection of boxes which also sell well from this counter location.
Ideally, the wall behind is slatwall. This provides good flexibility and allows for displaying sheeted paper as shown in the photo or other items from time to time. Change is important given the frequency of visits by newsagency regulars.
If you have room behind your counter, consider this or something else different from what you have now. I’d be surprised is it does not generate worthwhile business.
The free sachet of Squeek dishwashing powder on the cover of Gardening Australia this month is a lame tip-on. It has been used before, it is of little value and, as the photo shows, it is easily damaged when a browser puts the magazine back on the shelf. Tip-ons are meant to drive sales. The sachet of Squeek is a distraction for an otherwise good magazine. What does dishwashing detergent have to do with gardening anyway?
Further to my last post, here is another aisle end from our newsagency in Frankston – promoting the May issue of Women’s Health. Again, the customer can purchase off of the display. Also, the display covers the older magazine fixtures and gives the shop a brighter feel. I appreciate that some will argue that we should be paid extra for this in-store work. maybe we should. In the meantime we will continue to boldly display marketing collateral for titles which we know will respond to such in-store effort. Women’s Health is one such title. Every time we create a bold in-store display, sales lift.
The magazine fixtures in our Frankston shop are the old (inflexible) style. This does not stop them being dressed with collateral for brands we are happy to support. The aisle end display for Belle is a good example. Belle responds well to this type of display in terms of sales lift. Note the acrylic fixture off of which customers can buy the title. While I can appreciate that a more modern shop would struggle to support this older type of magazine display, it works a treat at Frankston. Our annual magazine sales are close to $500,000 and year on year our decline in the current market is below average. I put this down 100% to brilliant in-store merchandising by our Frankston team.
We have a column in front of our counter at Frankston which our creative team finds ways to dress. This week, the column is dressed with collateral promoting Zoo Weekly and the $50,000 cash giveaway. We started using the column for magazine promotions earlier this year and it is working well.
The acrylic unit off of which customers can purchase Zoo is essential for a display like this.
Weight Watchers magazine moving to monthly is working in our newsagencies. Our team at Frankston is pitching the latest issue at the counter. They have done this before – the title performs well in this location next to our two busiest register points. Indeed, I have seen seveal stores where Weight Watchers sells better from the counter than in the usual location. I think this is due to the transition to monthy. I’m happy to pitch it at the counter based on sales achieved.
While sales of adult magazines are increasing in my newsagencies, Playboy is in difficult waters internationally.
The current trend in my newsagencies is double digit growth for adult titles off a low base. I have no explanation for this and it is contrary to what I would expect given the satisfaction available online without cost. Last night, I went back over the data for the January through March 2009 versus 2008 sales benchmark and found that, overall, Adult magazine sales are down 8% in newsagencies.
Playboy, on the other hand, is reporting growing losses. ABC News in the US has a good wrap up of the current situation including an explanation of why the magazine itself is unlikely to fold.
I heard Gay Alcorn, editor of The Sunday Age, speaking with Jon Faine on 774 ABC radio in Melbourne yesterday as they guest in a weekly feature on media. The part of the discussion which piqued my interest was Alcorn’s ignorance of the new Kindle DX. Alcorn’s comments were at odds with reporting out of the US. They lacked the objectivity of a good reporter. She more or less dismissed the device.
The new Kindle from Amazon, which is not available in Australia, supports books, magazines and newspapers. Indeed, it is well supported by several publishers. The Kindle is certainly showing US publishers how to cut the distance between their journalists and consumers and thereby eliminate many distribution costs.
While it will not suit anyone working for a newspaper publisher to contemplate dramatic change to the business model of your employer, editors and journalists who agree to take part in discussion of any aspect of their work need to be open minded about the disruption of new devices like the Kindle. Alcorn’s dismissiveness of the Kindle gave me reason to take less notice of her other views.
Imagine if the Kindle was here in Australia, now. The newsagency business model would be turned on its ear. We need to contemplate and prepare for such change. Even it it does not unfold this way, the preparation will make us stronger and more focused on pursuing our own future.
One reason newsagents do not engage in contemplation of considerable change is the comments from publishers and journalists working for publishers that the changes in the US and elsewhere are not relevant to Australia.
Australian newsagents are overloaded Photoshop magazines. We have more than the five titles in the photo through the course of the month at my Forest Hill shop. I am confident that we could lose half the titles we receive and still achieve the same revenue from Photoshop related titles. This oversupply is an example of why newsagents need to have control over the titles which gain access to our retail network. Until we centrally manage access to our retail network we will continue to receive more titles than we need. While magazine range represents an important point of difference for us, it is unsustainable for 4,500 newsagents to provide the point of difference.
The code of conduct being discussed by magazine distributors will not address this issue.
The Slate Group, an online publishing subsidiary of The Washington Post, has launched DoubleX, and online “magazine” for women and written by women. Launches of new online titles like DoubleX continue apace. This is another reason magazines are more affected this recession than previously – there is considerably more choice online.
I’ve been told that the craft, patchwork, quilting and other magazines from Express Publications are not welcome in craft shops. At least these businesses can exert control over what magazines they take. As I have noted here before, Express Publications abuse the generosity of newsagents in my view.
Dolly magazine gains access to our prime retail counter promotional position this week with the free Davenport nightshirt and bedsocks which come with the title. We think the gift speaks to the demographic and is unique enough to justify the prime space allocation for Dolly magazine.
Both Dolly and Girlfriend are chasing a tough demographic at the best of times. Today’s challenges are evidenced by the regularity of tip-ons with each.
The other important and topical interest for this issue of Dolly is that it is retouch-free. That is, photographs have not been retouched. This is receiving good media coverage and should, therefore, be more top of mind to customers.
We are pitching Home Beautiful, the Melbourne Observer, OK!, Time and Super Food Ideas around our newspapers this week. We have cover the two biggest magazine publishers, support an independent newspaper, recycle an old magazine display unit and support two lower volume magazines – good use of newspaper space I’d say. The OK! display is the Alpha magazine stand recycled.