Feedback from my two newsagencies and four gift shops is that customers are thrilled to support our collection of change for the Red Cross Bushfire Appeal. We are doing this as part of the newsXpress initiative announced Monday. The notice we have with the collection container is that donations are best made direct to the Red Cross. Even tough we are only asking for loose change, customers are leaving notes. The generosity is wonderful to see.
Check out this photo from a newsagency in New South Wales. The Bill Express screen is still up and turned on and running an ad for the dead BOPO prepaid Visa card. No wonder we are considered a has-been retail channel by some suppliers.
If you have a Bill Express screen take it down or play other content. Do not advertise BOPO because that makes you and all who share your shingle look bad.
We really are our own worst enemy sometimes.
Given the response to the KICK START YOUR NEWSAGENCY workshops this week, I am looking at locations for another round. The plan at this stage is to offer this business building workshop in Hobart, Launceston, Woollongong, Gold Coast and Newcastle. I’d appreciate feedback on other cities which should be considered.
US magazine retail sales fell 11% in the second half of 2008. The same period a year earlier saw a 0.2% drop. See the Wall Street Journal report on this. Also check our Erik Sass’ report at Media Post for more an industry analysis.
The bottom line here is that magazine sales in the US took a considerable hit in the second half of 2008. Magazines are not the recession proof category they have been before.
I think we will see similar numbers here in Australia.
Now, mroe than ever, newsagents need to engage smart strategies to protect their magazine business. While consumers are spending less on the category, we have the capacity to pull business from non magazine specialists. We do this by being the specialists not only in range but in display and, most important, value proposition.
In October 29, 2008 I asked Is it time to Kill off Universal Magazines? I wrote this in frustration about my inability to control the supply of product from Universal Magazines. After years of getting nowhere with suppliers on achieving an equitable supply arrangement for I felt I had to strike out and bring the supply model issue to a head. That morning, Universal was on my mind because of what I saw in my shop.
A couple of weeks ago I met with senior executives of Universal. This was a good business discussion around the challenges from both sides and how the magazine distribution model is a real barrier to publishers and to newsagents.
In the months since the initial blog post, Universal executives have dug deep into the magazine supply model to understand why I and other newsagents who commenter to the post were so angry. The result of their investigation and reflection is improvements to processes and around the supply of their titles which did not exist last year.
From my own face to face discussions with the folks at Universal I also understand more about their goals. Interestingly, we agree on many discussion points. It is the magazine supply model between their business and my newsagency (and newsagencies around Australia) which is the barrier to an idyllic relationship.
magazine distributors lept to the defence of Universal quickly in October last year. The issue underscoring the blog post was their performance and decisions they make and not so much about Universal – it is breathtaking that they did not out their role in the problems at the time.
Hopefully, over the next few months, progress will be made on the model so that independent publishers and Australian newsagents can achieve a more mutually beneficial and rewarding relationship.
Magazine Publishers of America has announced that they are partnering with Google to host “Magazines 24/7: Google Day NY”. Here are details from the MPA blog:
Google team leaders will discuss digital strategies for magazine publishers to improve websites and build audiences. Topics include: how to maximize revenue with your website; growing your digital audience; and new opportunities for selling subscriptions online. We’ll announce more specifics on the May 14 event in the coming weeks, but it’s free to the first 200 people from MPA-member companies who sign up for the March 3 “Magazines 24/7” conference.
This event is a companion to the MPA conference being held in New York at the same time. The is considerable work being done within US magazine publishing houses to leverage online opportunities. Newsagents risk finding out about this activity and impact late in the day. This is another reason we need flexible shopfits.
The KICK START YOUR NEWSAGENCY management workshops I am involved with are in full swing. Yesterday in Brisbane we had a good discussion about our all important point of difference and again today in Sydney. It is good to see newsagents so passionate about ways in which they make their business stand out – some have flown into town to participate. Like all workshops, this one will evolve as I get around the country this week. The details for Canberra, Adelaide and Perth, the remaining locations in this initial cycle are:
If you would like to come and join the conversation about growing newsagencies feel free to drop in.
The newsagency I have written about a couple of times (here and here) when they closed for lunch and closed for a week has closed for good. While it’s disappointing to see a newsagency close, it is good to see a sub standard operator get out of the business and therefore stop pulling the rest of us down. I was a regular in this shop and it frustrated me to see empty shelves and to experience mediocre customer service. Some Victorians will recognise the shingle – the Logo brand was local to Victoria years ago but has not been in use since the mid 1990s.
The presentation of this newsagency over the last couple of years was one reason I wrote here that the shingle newsagency is of little use any more. Why would I want my newsagency to be considered part of a retail network with businesses like this? This is why other retail brands in our channel are getting stronger and why, I suspect, they will refer to themselves less as newsagents and more just by their brand name.
Following some discussion here, I have been taking more notice of titles I get in one newsagency and not another. Take Green Power Today. Had I known this was available I might have put my hand up to give it a go because I like the idea of an environmental segment. Gotch is good at letting us know about new titles. The other two magazine distributors are not so good. Maybe more visibility of what is available would see newsagents being proactive at building segments and categories or magazines. The challenge with that approach that it would need to come with the ability to more easily remove (permanently) titles from distribution and there is the problem for the distributors.
As for Green Power Today, while I would have liked to try the title, please don’t send it NDD.
Engadget has a photo of two amazing-looking e-paper displays, one black-and-white and one color at a Taiwanese book expo last week. Some say that e-paper is the real, long-term, threat to newspapers.
newsXpress announced to its member newsagents yesterday that it was in discussion with the Red Cross about the best way it could support its Bushfire relief Appeal. Through a series of discussions and following many calls from similarly concerned organisations, the Red Cross has asked newsXpress to promote donations being made direct to the Red Cross. newsXpress has provided its members with material explaining to customers where and how to donate directly as well as inviting them to leave change which newsXpress newsagents will donate direct to the Red Cross bushfire appeal. Here is a copy of one of the counter notices provided to inform customers in newsXpress newsagencies:
Elizabeth Beach from Nextra Royal Brisbane Hospital sure knows how to dress for impact. The photo shows how Elizabeth was dressed today to promote tickets in the $40 million jackpot tonight.
As Elizabeth explained to the newsagent’s workshop I was presenting in Brisbane today, dressing like this sells to customers and it engages with them – helping them to enjoy shopping with you.
Elizabeth tells me that every day she dresses to connect with the customers and therefore the business. Customers come in daily just to see what she has on. What a fantastic point of difference for the business!
Newspapers across Australia are demonstrating today the important role they play through thoughtful coverage of the Victorian bushfire disaster. While online outlets have more immediate news, The Age and the Herald Sun provide a level of analysis of the events which showcases the difference of the medium.
I was at the airport today and saw someone checking a news website on their laptop, the person next to them using their iPhone (not sure what for) and a third person reading the Herald Sun. Maybe I am biased but I suspect the newspaper reader will have a better perspective of the event thanks to the analysis and scope of coverage so easily through print as opposed to other mediums.
I’ve just read What Would Google Do? by Jeff Jarvis and published by Harper Collins. I got my copy direct from Amazon where I ordered it six weeks ago. How I ordered the book is important because it is, in part what WWGD About – how business has changed and how consumers are more in control than ever. Whereas years ago I’d have heard about the book and had to wait at my local bookstore, now friends who buy books I like at Amazon can alert me to this and other titles, friend I never knew I had.
What Would Google Do? is not about Google at all. It is about disruption brought about by technology intersecting with and driving consumer demand where one is more powerful than ever before. It is about conversations rather than sermons, connections rather than advertising. Being part of the story more so than just consuming the story.
This is a book full of ideas for Australian newsagents because it challenges us to break free from a business model created more than 100 years ago and to pursue a model relevant to today. There are excellent examples of how to Google thinking to bricks and mortar businesses like ours. His comments about the music industry apply to us and some core products we sell in our 4,600 retail stores.
For another perspective of the relevance of the book check out the interview Jarvis with with Newsweek. Also read Jeff Jarvis’ views (published in Business Week) on how the Google approach to business could help US auto companies.
Jarvis and his publisher are demonstrating how to stretch a traditional model with the release this week of a video book version.
Since Super Food Ideas sold out when it had a free timer a couple of weeks ago we figured it is worth pitching the latest issue of Australian Good Food magazine at our prime counter position – with the free kitchen timer. This is a real test for Australian Good Food in our newsagency as it is struggling to find an audience. After a good start, sales have slowed. We will leave this display up at our counter all week.
We have Underbelly A Tale of Two Cities on our shelves for $17.95. We have priced the book to be within reach of the Coles price.
While we would prefer a higher margin, we are happy to see it sell and for our business to be seen as being a reasonably comeptitive on price for such a popular product.
Today’s issue of Greek newspaper Neos Kosmos illustrates the community connection a good foreign language newspaper can have with the local community. The Victorian bushfire story dominates. Il Globo also provides excellent coverage of the story for the Italian community. In our newsagency these titles are as important in terms of sales and customer loyalty as The Australian and the Australian Financial Review.
As I write here often, niche newspapers, like foreign language newspapers, an important segment of the newspaper category in newsagencies. Their sales returns are bucking the trend of capital city dailies.
Nicholas Carlson writing at Silicon Alley Insider asks whether the New York Times would be better off giving all subscribers an Amazon Kindle to receive the newspaper electronically rather than a print edition. Fast Company picked up the story and summarised the numbers:
And then there’s the math: From the NYT’s financial report, production costs in terms of raw materials and wages/benefits tally around $844 million a year. Carlson has info suggesting the newsroom costs total around $200 million a year, meaning it costs some $644 million to print and distribute the physical newspaper.
The Times reportedly has 830,000 subscribers. A Kindle costs $359. Thus distributing a free Kindle to each subscriber would cost about $298 million.
This example illustrates the perfect storm scenario for Australian newsagents who handle newspaper home delivery. Not that a publisher would give away the Kindle (it does not work here in Australia anyway) but rather that the numbers for a completely different distribution channel are so compelling.
It is good to see Tattersalls try different marketing tools – they have sent pads of post-it type notes promoting the Valentine’s Day $14 million draw. While we are putting these to good use, I’d like a way included to draws customers back here.
Judging by the radio ads playing in Melbourne over the weekend the Harvey Norman OFIS outlet here will be closed in weeks rather than the months originally indicated. If I had a store located nearby I’d be promoting around the store with some outdoor advertising – letting customers know that my business can continue to supply them.
The 5 WAYS TO KICK START YOUR NEWSAGENCY workshop starts on Monday. I’ll be hitting six cities in five days and meeting with between 250 and 300 newsagents. This weekend I am working on the content to ensure it is fresh, relevant and genuinely useful. The location details are:
I’d be thrilled to catch up with newsagents who wish to drop by who have not booked – it’s free. Even though we have excellent numbers in each city I am sure we can make room for more.
I served a customer yesterday who had been told by a friend to come to our newsagency for a calendar for her favourite dog breed. This customer drove past two major shopping centres in 46 degree heat to get the calendar – for her dog. She bought another calendar, a magazine and a card. When talking with her about why she would go out in such extreme heat she said she’d do anything for her dog. She told me she would be back.
We built our calendar range around special interests. This started three years ago and we have got better with time. Word of mouth driving new customers to us like I witnessed yesterday is what we have chased.
The 500 or so 2009 calendars we have on sale now for $5.00 are delivering a healthy margin, more than double what we achieve for magazines. We will sell out and end the calendar season well up – in January we were 13% up on January 2008.
Crains reports that 525 US magazines went out of business last year and that so far in 2009 40 magazine titles have closed.
The terrain is not as harsh for magazine publishers here in Australia because of the newsagent network. In the US, most sales come through subscriptions whereas here in Australia, retail, newsagents especially, provide a cost-effective channel to market. I suspect, however, that the economic climate we are currently experiencing will see many Australian newsagents finally act on underperforming magaiznes.
I missed that The Australian published an update on the On Q / Bill Express mess January 16. The report catalogues what we knew – bad business practices, dodgey loans and lame excuses.
It surprises me that in the collapse and subsequent winding up of Bill Express and OnQ that newsagents have received no communication regarding the equipment sitting in boxes in the back of newsagencies. I have asked several interested partiesand no one has an answer.
I’m told that there is a post-it ad stuck on the front cover of the Illawarra Mercury today promoting a home delivery offer. Pay $4.00 a week for six days of the newspaper. The usual price for six days is $7.50 plus a delivery fee. On top of the massive discount, which the newsagents is forced to partially fund, the publisher is giving away a $50 Coles / Myer Gift Card and a bunch of other freebies.
It is appalling that a newspaper publisher forces newsagents to pay for a campaign such as this when the newsagent has no capacity to balance the cost with other revenue in their business. It is an abuse of the newsagent / publisher relationship. If I were affected by this I’d be asking the ACCC what the Trade Practices Act says about such an arrangement – despite that a contract between publisher and newsagent may speak to this type of deal.
The publisher is prepared to discount because they will win through protecting advertising rates by staving off circulation falls. The newsagent gets no cut from advertising.
I went to the Mercury website to check out the details. I clicked on the ad and it took me nowhere. So I clicked on subscriptions and was given the email address and phone number for the circulation manager. I clicked on promotions and found nothing about this. Someone in marketing stuffed up.