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

Reinventing newspapers, reinventing newsagents

Newspapers are doing it tougher in the US than Australia with many dropping circulation and ad revenue at alarming levels.  We’re insulated here by a cost effective (for publishers) home delivery network, a strong national retail network and the natural delay of trends hitting our shores.   That said, newsagents should read Ted Leonsis’ 10 plan for reinventing the newspaper business.

I was first introduced to Ted ten or eleven years ago during a 3 year (part time) entrepreneurship program I undertook at MIT in Boston.  The Birthing of Giants program was organised through Inc. magazine.  The sessions were inspirational.  My recollection is that ted Leonsis was a visionary thinker, still is.  He helped shape the thinking of the class, to see beyond the challenge and through to the opportunity. If you read Ted’s blog post about reinventing newspapers you’ll see he has not changed – his proposals are bold and while others have suggested some before, his pitch is clear and compelling.

Leonsis’ ten point plan could apply to Australian newsagents.  It is relevant to my post couple of days ago about why newsagents should buy borders.  We will find our future by being bold and acting collectively.  Every day we act alone and with our eyes focused on the next stp0e in front of us is a day lost.

Publishers have serious challenges in the US and, soon, here in Australia.  They will develop solutions which suit them, as they should.  At some point, the solutions they will pursue will shift in core focus from our channel.  This is what we have to be ready for.

We need to be talking today about the relevance of newspapers to the newsagency of the future.

We need to be talking about the shingle itself.  Is newsagent relevant?

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Newsagency challenges

The view from Mt Wellington

I have been fortunate to spend a few days in Tasmania, taking a break and enjoying the sights. The most amazing sight in the south east region is the view on top of Mount Wellington, way above Hobart. Not the view down over Hobart but the view at the back, across territory which could be on another planet. It’s amazing.

mt_wellington.JPG

Looking at this view I realised that I was focusing too much attention on the foreground and missing the grandeur of the valleys mountains in the background.

I enjoy the perspective travel brings – business travel and personal travel. Every time I’m outside my usual routine and space I find myself thinking about work and all involved there in a different way.

Just at the brisk air on top of Mount Wellington clears your lungs, travel can clear your head and see a new road ahead.

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About us

Fighting clock watchers

Sundays and some Saturdays at Forest Hill, some retailers around us close early. Some ten minutes, others up to half an hour early. This sucks. We are at the end of the mall so people looking our way see these closed shops and because we are set back they don’t even walk down to see if we are open.

Businesses do not grow by contracting. If these businesses are slow toward the end of the day they ought to fight for business. We, those of us at this end of the centre, could do it collectively. This type of positive action is better than them just closing ewarly as they do now.

It’s frustrating because most don’t care, they are branches of national brands and the local staff are happy to get off early.

We’re thinking we might really pump up the volume of our sound system for the last half hour on a Saturday and Sunday, to luire people into what could evolve into a party. Our view is that we need to embrace the problem and fix it for ourselves.

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About us

Promoting Mindfood

frank_mindfood.JPGThanks to the folks at Network Services, we have been provided some excellent collateral to enable us to promote the new Mindfood magazine. This is the type of material I was referring to when I first blogged about Mindfood.

Since this is a title which could work in several locations, we have decided to go hard at our Frankston newsagency and promote the title at our main newspaper display. Watching customers approach the display shows it’s working in that the title is noticed. Every so often someone picks up a copy. We also used the newspaper location because every other magazine feature space was taken with another title being pushed.

Promoting new titles from independent or small publishers is a challenge. For newsagents to draw attention to the title we need help. That’s where collateral like posters and cover run-one are essential.

We have developed a one page strategy for new titles, regardless of whether sufficient collateral material is provided. The strategy does considerably more than placing the title on the shelf where the publisher or distributor requests. it engages us as retailers in a number of ways to get the most from the title. It also has some KPIs which, if not passed, lead to a decision to remove the title.

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magazines

Who needs a newspaper?

Over 300 newspapers, updates every 20 minutes.  Who needs a newspaper when you can access eufeeds.  Their tagline lets you know that they have all the news you could want – up to the minute.  Newsagents skeptical of the impact online could have on print ought to check this site out.

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Media disruption

Newsagents should bid for Borders

The news out of the UK for Borders is not good. The Telegraph and others are reporting that the whole business is for sale and not just selected parts.

A week back we learned that the A&R Whitcoulls bid had been withdrawn for the Australian and New Zealand operations of Borders.

While it would never get up, newsagents should consider making the leap and buying Borders’ Australian business. It’s think kind of bold completely out of left field move which will provide channel wide focus. It would unlock better commercial terms for books for newsagents as well as give newsagents a stake in a major national chain. Totally crazy! Doomed to fail! But, what if…

Am I serious? No, well, sort of. many newsagents need to leap (be pushed or dragged) out of a small business victim mindset. They a bold mission, a new mission which makes them part of something much bigger. This is why the Borders opportunity is interesting. It’s something we would never do and cold never pull off. It’s exactly the kind of mission newsagents need to actively consider.

Of course, for this to even be considered, newsagents need to act as a cohesive channel of entrepreneurs who will pursue business opportunities with missionary zeal. They need to want a profitable future.

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Book retailing

Not much Easter fun for newsagents

I feel for distribution newsagents in Melbourne and Sydney this weekend as they navigate the complex Fairfax easter delivery requirements for The Age, The Sydney Morning Herald and the Australian Financial Review.  The bumper edition process is so convoluted that it adds extra work to newsagents for no extra revenue.  On top of the hassle of managing the process is the customer complaints from subscribers who will feel ripped off.  News Ltd handles holidays like Easter better.

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Newsagency challenges

Lower banking fees for newsagents

We sent out the following announcement to newsagents today.

Newsagents are set to save hundreds of dollars a year thanks to new, lower banking fees negotiated with St.George Bank and BankSA.

A 0.63% Merchant Service Fee (MSF) for credit cards and a $0.07 (or 0.227%) fee for debit cards set a new low benchmark for these transactions in newsagencies. 

A $10 per month terminal fee is 60% less than what many newsagents pay today.

Exclusive to newsagents using the eziPass electronic product platform, the new St.George and BankSA banking fees are expected to save an average newsagency around $500 a year.

 “We are thrilled to announce this relationship with St.George and BankSA”  Commented Mark Fletcher, Managing Director of Tower Systems, the developers of eziPass.  “Cutting EFTPOS fees for newsagents is an important part of the eziPass mission.  Without a middleman, newsagents are better placed to be more competitive.”

eziPass offers over 300 electronic products including phone recharge, tollway payments, movie downloads, a full range of international calling cards and many other products. 

Access to eziPass is free and there will never be any fees.  There is no long term locked-in contract.   Payment for stock is made weekly and margins on some items are considerably better than alternative electronic vouchers.

Newsagents can start saving with eziPass today.  Those not using Tower Systems’ software will have access to a stand alone version of the product from the second week of April.

BACKGROUND.  eziPass has been developed by Tower Systems for use by all newsagents.  Tower Systems does not take any commission or payment from its eziPass work or transactions put through eziPass, thus enabling better returns for newsagents.  Tower Systems already serves over 1,450 newsagents nationally. 

Newsagents who have signed up for eziPass will be sent the paperwork from St.George and BankSA.

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Bill Payment

Driving Women’s Weekly sales

aww_apr08.JPGWe have run two separate successful over the counter marketing campaigns for the Australian Women’s Weekly over the last two weekends.

We increased sales the first weekend by 32 copies and the second weekend by 19 copies – tabove our usual sales for equivalent weekends in the sales cycle.

The campaign was run at each counter sales point. We created posters in-house and pitched it to customers. For the record, we did this without the knowledge of ACP Magazines.

We are always looking for ways to differentiate our magazine offer over the the supermarkets and others in the shopping centre with which we compete. A discount offer on a known brand fits with the value proposition pitch we want to make.

We chose AWW because we sense that consumers like the title but see it as something they can live without for a month. It remains one of the most popular titles redeemed with our Magazine Club card.

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magazines

Announcement

I have announced this morning the sale of the Find It free online classifieds website for an undisclosed sum. While Find It attracted more than 20,000 advertisements, less than half of 1% of these were placed newsagents – even though such ads (including business listings) were free. Without newsagent support, the Find It model could not work for newsagents – hence this difficult decision.

 

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Media disruption

Easter arrives at last

eg1.JPGNow that the heat in Melbourne is finally fading people apparently think it’s safe to buy Easter eggs.

With more than $20,000 invested in easter chocolate across a few stores I’m relieved. Some customers coming to the counter with an armful of eggs said the heat made them hold back.

Sales were great yesterday and I’d expect them to be even higher today.

Easter card sales have been fantastic. I’d expect a sell through of at least 80% in our stores. Plush has been just as good. neither cards nor plush suffered as a result of the heat.

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confectionary

Gardening Australia magazine at newsagents

gardening_australia.JPGAccording to the ABC, Gardening Australia magazine is available from ABC Shops and via subscription. The lack of support for newsagents shown by the ABC at their website is appalling. Newsagents heavily promote Gardening Australia and it sells well.

The ABC is not behaving as I expect our government funded national broadcaster to act. By ignoring newsagents and actively promoting the channels which they control they harm small business and make it harder for fans of the TV show to find the magazine.

This month’s Gardening Australia is a treat it features Jamie Oliver as well as a DVD with highlights from the TV show. Even though the ABC denies our existence as in the supply chain, we are actively promoting the title and driving sales.

They need to remember it’s our ABC.

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magazines

State of the news media 2008

News is shifting from being a product — today’s newspaper, Web site or newscast — to becoming a service — how can you help me, even empower me? There is no single or finished news product anymore. As news consumption becomes continual, more new effort is put into producing incremental updates, as brief as 40-character e-mails sent from reporters directly to consumers without editing.

This is an extract of one of the top line trends from the State of the News Media 2008 by the Project for Excellence in Journalism. It is a sobering analysis of not only the state of journalism but also the products which rely on journalists for content.

The newspaper trend is gloomy:

Circulation continues to fall at about 2.5% year-to-year for dailies and 3.3% for Sunday editions.

Magazines don’t fare much better in the analysis. What interested me was the optimism around efforts being made by some publishers and others to navigate the challenges. Successful media brands will survive the distribution challenge (print versus online) and they will do this by riding the change wave. This is what newsagents need to do.

Newsagents ought to read the report and make notes on changes which can be implemented in their businesses right away. Many newsagents won’t take this initiative – I think they are waiting for suppliers to lead them.

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Media disruption

The Easter book sale

frank_book_eas.JPGI am told that Easter is one of the best times of the year to sell books. Judging by the first two days of our book sale I’m inclined to agree.  Even before the brochures have been distributed sales are strong – over $300 for the first half day.

Our plan is to run the sale for up to three weeks in the middle of the dance floor and the photo shows. These things work best there is nothing else too close pulling visual focus.

Books are a good fit for newsagencies.  Some do them well all the time with new releases and top selling titles.  Others, like us, do well in the remainder space.  Most newsagents, however, don;t play in the space.  For them, it’s a missed opportunity because the the right range, targeted with your demographic can be very profitable.

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Book retailing

Twitter

I was talking with a tech savvy newsagent yesterday and he’d never heard of Twitter. I’d be interested to know if anyone reading here is playing with it – I only established my Twitter account a couple of months ago.  It’s fascinating.

Twitter helps people keep in touch. It’s also a mini blogging (news) platform for some – a good source of keeping up to date with sports scores or news as it happens if you’re following this right people.

The Blog Herald has a good report on Twitter and news habits.  Most major news sites overseas offer Twitter feeds.

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Blogging

Newsagents circling Bill Express

Not much good news for Bill Express today. Their share price has fallen to 10.5 cents, from 12.5 cents yesterday. There is a growing volume of dissent among newsagents about the unilateral removal by a $250 per store per month marketing subsidy by Bill Express last month.

While I am no lawyer, the documents I have seen now from several newsagents suggest that Bill Express has breached the agreement it had with these newsagent. In one case, Bill Express wrote:

In a nutshell, this guarantees that, combined with the other rebates we pay now, you won;t be out of pocket.

Thanks to the Bill Express action last month, this newsagent is out of pocket.

In another Bill Express document provided to a newsagent as part of their representations, Bill Express said:

Express Shop has formed a Marketing Support/Incentive program to offset costs to your business. This incentive is equivalent to making up the shortfall of up to 200 bill payment transactions and in recognition of your efforts in meeting the criteria outlined below and will effectively ensure that you are at a break even or better position.

Thanks to the Bill Express action last month, this newsagent is no longer at a break even or better position – even though they have done everything required of them by Bill Express.

It appears that Bill Express is prepared to breach its agreements and commitments with newsagents, both written and oral, in order to preserve cash. given the action individual newsagents are talking of, this may well prove to be false economy by the company.

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Bill Express

Driving magazine sales at the counter

instyle_fhn.JPGNewsagents wanting to drive magazine sales ought to try this idea. We have been using it for a few months now and it works every time.

We have allocated space at the counter, between our two busiest serving stations, to promote magazines being sold a free gift we consider worthy of premium space promotion.

The space we are using works. It’s great to watch customers at the counter with their purchases – many notice the display, some pick up the magazine and enough of those purchase to make the space valuable and part of our regular activity for magazines.

Last week we sold out of Home Beautiful in days. Yesterday we setup the InStyle display in the photo. Prior to that we sold five times our usual allocation of Good Taste.

We change the display every Monday and only promote titles with a free gift people can easily see and are likely to know the value of and / or want. This is not a place for the magazines which come with a free gift every month, there’s nothing special in that. No, the real value of this specific issue has to be obvious.

It’s a simple display and takes a few minutes to setup. Nothing fancy here. It helps to have posters and cover run-ons to build into the display. While the display is not the prettiest, it works and that’s what matters.

It seems we’re in the middle of free gift season at the moment – there are some excellent gifts on offer and some excellent titles from which to choose.

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magazines

Crikey! It’s a kids magazine!

crikey_mar08.JPGI’m surprised by the Terri Irwin cover on the Crikey! children’s magazine.

While not offensive, it’s crossed a line from what I’d expect to see on the cover of a children’s magazine.

Maybe it’s that I’m not used to seeing Terri in this way.

I suspect parents won’t see this as a children’s magazine. It certainly looks odd on the shelf in its usual spot.

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magazines

Embracing St Patricks Day

frank_stpats.JPGSimon and the team at Frankston donned their hats, strung up some four leaf clover and dressed the store to recognise St Patricks Day today.  The photo does not do their efforts justice.  The gold hats are the talking point and make for a happy retail space and that’s what the day is about – having fun.  It’s a challenge as to how far you go this week with easter just a few days away – so no painting faces green this year!

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newsagency marketing

Blending gifts and stationery

We continue to play with the blending of gifts, social stationery and stationery at our Watergardens concept store.  The ‘playing’ is part of our contstant movement streategy – we’ve leaned this from gifts that every day or two products need to move to present a fresh view.  The resulting sales tell us the labour investment is worth it.

water_stat.JPG

The table in the foreground has been built especially for the job of displaying gists and social stationery well.

People who visit newsXpress Watergardens say it’s not a newsagency.  I agree with that.  others say it is.  I agree with that.  We see it as what some newsagencies in the future may be like. Browsers stay longer and provide a bigger average spend.  Magazines and newspapers are important but it’s other categories which drive overall margin.

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Gifts

Pads beat candy at the counter

counter_stat.JPGWe have a new range of small pads at the counter and, as with the last range they are selling well. They work better for us than major brand candy – because they are unique to us in our centre whereas many others sell the major brand candy around us.

At my Frankston newsagency, where we have a confectionery story at the counter, we are reconsidering purely on a return on shelf space basis.

It doesn’t make sense to me that we think of ourselves as a convenience store or supermarket when it comes to this candy at the checkout.

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confectionary
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