Chemists get money from the government to fund broadband access in their stores. I was shocked to discover this yesterday. It’s one of a bunch of perks the government provides chemists. While I don’t begrudge their negotiating prowess with the government, I am shocked that the government looks after chemists like this while at the same time kicking newsagents in the guts again and again. Newsagents pay for their own broadband.
For years now magazine publishers and distributors have been working on a project to access sales data on a daily basis from newsagents. While suppliers have complained that lack of sales data is the cause for resolving core issues, few have actually taken the necessary steps to resolve the issues. With accurate sales data suppliers can more accurately supply product so the benefits are considerable. This cuts costs for newsagents and suppliers by reducing over supply and resolving undersupply. Suppliers can get accurate sales data if they choose. All they need to do is:
Compensate newsagents for accurate sales data. The sooner the newsagents providing accurate sales data make money from this the sooner many other newsagents will do what they need to do to provide similar data on time.
Rate the newsagent software suppliers. Recognise the providers of compliant software with a rating and a recommendation which directs newsagents to them compared to those companies which flout the standards.
Be public about IT companies letting the project down. For example, one competitor does not provide sales data through its software. It has a record of claiming its software is compliant when it is not. Suppliers, by their silence, let this competitor get away with this and this extends the resolution of the sales data mess.
Be clear on the industry benefits of sales data. Show newsagents what this looks and feels like.
While newsagents are not helping themselves in resolving the sales data mess, suppliers can take steps quickly to sort this out and have newsagents more fairly competing with the major retailers thanks to, finally, providing accurate sales data on time.
For newsagents to compete with supermarkets, petrol, convenience and coffee outlets they need to get smarter in managing data. This means they need to ensure that their IT suppliers adhere to industry standards. One company failing to meet standards lets the industry down. It is time for people to be silent about the cost of this to all newsagents.
If the newsagency channel continues to ignore this issue they will continue to miss out on the financial rewards of providing sales data and competing with the big guys on an even footing.
It is good to see magazine distributors responding favorably to newsagent requests to cut grossly underperforming titles. While the distributors have had sell through rate data, they leave it up to newsagents to “make a case” for the cutting of a title. 1,300 newsagents using software from my company can now make the case with ease. Those who have put title cut requests in tell me that the distributors are agreeing. They have no choice – especially if the evidence shows that less than 30% of copies of a title actually sell and that continued supply of a title causes the newsagent to lose hundreds of dollars.
The problem is that the stock has to go somewhere since distributors are paid to place it with a retailer. This means the divide between smarter newsagents and the others will become greater.
In my case, cutting 50 titles means more space for promoting successful titles.
We have more than 600 newsagents signed up as retail partners for our soon to launch online calssified business, Find It. This is our last week and we’ll complete final presentations to newsagents on the Gold Coast and in Brisbane, Syndey, Adelaide, Perth, Geelong and Melbourne over four days. We expect to end up with more than 800 newsagents representing us. Our partner newsagents get to play ith a pre beta copy of the site from next week so they can develoip their own understanding of online classifieds and what makes Find It a unique value proposition to other sites out there.
In January we installed this LCD screen in store to promote products we sell. We did this out of frustration with the Bill Express screen which was advertising businesses and products outside our shop. Since then, Moving tactics have been promoting their advertising screen to newsagents. My understanding is that I could make between $1,000 and $4,000 a year from the Moving Tactics unit. The numbers are similar for local ads on the Bill Express unit – but these advertise businesses outside my shop and I cannot veto an advertiser. While these screens controlled by others carry professionally produced national campaigns, I’d rather have full content control and focus on products which suite my business that day. I reckon I’ll make more from that.
Since we started trialing this Herald Sun stand, the number of newspapers sold alone has dropped significantly. The number of newspapers sold continues to rise. We still have our main newspaper display, the unit in the photo is at our lottery counter. Lottery customers can easily impulse purchase the Herald Sun and Herald Sun customers can impulse purchase lottery product.
As the habit of newspaper purchase is further challenged, we (newspaper retailers) need to be smarter in getting customers to purchase. This stand places product front on and in a way which facilitates pick up. While it might be small point, the experts say that a consumer picking up a product is for more likely to purchase than just looking at it.
Newsagents can take the “oh, woe is me” approach and worry about the future of newspapers or then can be entrepreneurial and be smart in every decision about newspapers and grab every sale they can in this challenged marketplace. I just wish that the publishers would handsomely reward newsagents who achieve above industry average sales growth as this would encourage business like behavior by newsagents.
The display stand we are using has been provided by the Herald and Weekly Times following my approach to them with photos of similar stands I saw in the UK last year.
News Corp demonstrates the importance of MySpace and the social network phenomenon at its ultra high powered executive retreat this weekend at Pebble Beach. Thanks to the LA Times we can read the href=”http://www.latimes.com/media/acrobat/2006-07/24616306.pdf”>agenda and see the following session:
Meet the MySpace Generation
A live focus group and instant response dial session to explore the attitudes and lifestyles of our new consumer…a presentation conducted by pollster and researcher Frank Lutz with 20 students. Introduction By Ross Levinsohn.
A good story at the Economist about Christine Dolce, Californian cosmetician who has turned here MySpace page into a solid revenue stream thanks to the 900,000+ MySpace ‘friends’ who link to her page. This story underscores the shift marketers and advertisers have to deal with in this era of online social networks and explains some of the challenges.
I made a rare use of Melbourne’s train system yesterday evening to get to the MCG for the Collingwood Hawthorn AFL game. In one carriage I counted more than 50 copies of the day’s MX newspaper left on seats and on the floor. That suggests the train probably had close to 300 discarded copies of MX. Multiply 300 by the number of trains used during peak hour and the operators cold be dealing with anything from 25,000 to 50,000 copies of MX discarded every day. Is this a problem with free commuter newspapers globally or is what I saw local to my train line or local to Melbourne? I’d be interested to find out whether trash is a problem with free commuter newspapers and if so why are we not hearing about it? I should note that there were only two other items of trash on seats of the floor in my carriage.
The weekend manager at our newsagency resigned by SMS text message on Wednesday. No warning, just a text saying thanks for the ride. This person had been in the role for two months. While the current affairs programs are quick to run a story about bosses who sack people by text message I suspect resignation by SMS will attract little attention.
This resignation is frustrating not only because of the staffing impact but also because the person involved was too gutless to have a conversation about their desire to cease working with us. I wish I could register her name on a database so other potential employers could be warned about her.
Simone Callahan, the ex- Mrs Warne, is doing a great job selling magazines if the data I am seeing is reflected nationally. Each issue with her on the cover this year sells well. This week’s New Idea is no exception. While all other weeklies are having a usual week, New Idea is ahead on average performance. Maybe it’s a Victoria only, maybe it’s even localised to selected outlets. I suspect not. Over the counter comment suggests that readers of New Idea and other women’s weeklies like to read about local people. If you look at the biggest issues this year I’d suggest the sales numbers support that.
My software company, Tower Systems, competes with POS Solutions. We are the two major newsagency channel IT players. In their newsletter to newsagents last week POS Solutions claimed:
“Recognized as a leader in magazine management POS Browser continues our commitment to saving time in handling ,magazines. Xchangeit, customer email putaway notifications, detailed bar-coding of titles and Automatic billing of customer and sub agent orders is just a few features built to provide better service and save time. Automatic early returns for over supply of magazines help your cash flow; report on slow selling magazines by distributor to adjust supplies.â€
The POS Browser software does not meet current industry standards. It has not passed the XchangeIT magazine management standards agreed by the magazine distributors three years ago. POS Solutions has failed to deliver on these standards for the users of its DOS software – the majority of its customer base.
POS Browser and POS DOS could only make their claim of “leadership” if their software met industry standards as it is these standards which facilitate best practice in magazine management. Crucially, the standards provide for sales data to be passed back to suppliers so they can balance supply.
I doubt that the three magazine distributors consider POS Solutions to be a “leader in magazine managementâ€. I suggest that this recognition is only in the minds of the POS Solutions marketing people.
My company is being let down by magazine suppliers and other stakeholders as they refuse to enforce the standards they established. Their inaction allows POS to claim leadership and get away with it. Outside my company and POS there are two other significant software suppliers to newsagents. As I understand it they also comply, leaving POS Solutions alone at the barrier of non-compliance.
Newsagents are only as energetic about compliance as their software provider. To this end, POS Solutions’ lack of attention to industry standards is holding the whole industry back as the newsagent channel is as weak as its weakest link.
When the Directors of POS Solutions read this they are likely to shoot off an email or two to me, call their lawyer and write to the ACCC. I’d welcome the issue of their inability and apparent reluctance to provide compliant software being debated in a more formal forum.
Newsagents need to carefully evaluate software and ensure it meets the various supplier compliance requirements. Compliant software companies have nothing to fear from such comparison. That the newsagency industry has standards which are not enforced provides POS Solutions a break they do not, in my view, deserve.
Disclosure. I am the Managing Director and sole shareholder in Tower Systems International (Aust.) Pty Ltd and have written this entry as fair comment. The Directors of POS Solutions are welcome to publish a response.
Media and other players are in a global race to connect to the mobile consumer.
Speaking in London in March this year, Rupert Murdoch said:
“…media becomes like fast food – people will consume it on the go, watching news, sport and film clips as they travel to and from work on mobiles or handheld wireless devices..â€
Google yesterday launched a traffic jam application covering several US cities for mobile devices. Read what Google has to say here. It is applications like this which are more relevant to mobile consumers. Connect this traffic jam information with in context advertising as Google will and you can see the revenue model. This information from Google is more relevant to a commuter than a celebrity story or sports results.
While it may be years before we see this mobile activity in Australia, newsagents need to consider the US developments in terms of capital investment in their businesses today. They would be well advised to take their investment lead from their suppliers.
Image courtesy of Google.
newassignment.net is a fascinating new US based model for publicly supported journalism. Read more at Jeff Jarvis’ blog BuzzMachine. NYU Associate Professor Jay Rosen is behind the project and he outlines his plans here. Newassignment.net is an exciting initiative. It puts people interested in news in play with those writing news stories. It uses open source methods and professional reporting skills to bring a story to completion. The more voices we have participating in reporting news the better. It will be interesting to see if any Australian Journalism schools support the project.
In June 2005 I blogged about Epic 2015, a brilliant flash movie by Robin Sloan and Matt Thompson. It was an update on their darker Epic 2014. I mention Epic today, more than a year after my original post since there are many more readers here now who may not know about Epic. Before you watch it, think for a moment about how much has changed online in the last year. Google alone has evolved dramatically – forward in its mission to index all information in the world.
Newsagents could be the dinosaurs of this changing world. To ensure they (we) do not become extinct, newsagents need to be aware of the changes happening around them and within the businesses of their suppliers. One way to understand the possibility of the extent of change is to watch Epic.
Leveraging its 4,000 strong Gold Crown store network and many more supermarkets and convenience stores in which it has space in the United States, Hallmark, the world’s most recognised greeting card brand, is to launch Hallmark Magazine next month. MediaPost has the story.
Hallmark Magazine looks like a combination of Oprah’s O Magazine and Martha Stewart Living without the personalities and delivered with Hallmark’s attention to detail and quality. I like their tags:
Helpful information. Creative ideas. Ways to make our lives simpler, better and more satisfying.
The MediaPost story reports that advertising in the first issue is a sell-out.
I have no idea whether Hallmark Magazine will launch here. Based on what I have read so far, a Australian issue with the same content goals would, in my view, sell well.
No wonder News and Fairfax contemplated, even if only briefly, a joint venture to compete with Seek. This graph from Alexa shows daily reach per million for the last six months for Seek compared to MyCareer. The reach for CareerOne was around the same as MyCareer. Seek is the stellar performer in the online employment space. They built their business quietly while newspapers played in their rivers of gold, not realising that the world had changed.
Tradition dogs just about every decision a newsagent makes from the layout of their shop through to how they process day to day transactions. Some of these traditions deny newsagents the growth they crave. Take the location of greeting cards in a newsagency, for example. Most have their card ‘aisle’ located toward the back, in an area away from the main store traffic. Some do this because they want to provide a quiet space for the reflective nature of the greeting card purchase. Others do it because of the demands of newspaper publishers and lottery companies to have the best space in the shop. Others do it because everyone else does.
Last year we moved greeting cards from a rear middle aisle to the front of the shop. The result is excellent sales growth and encouraging feedback from customers. Rather than treat cards as a poor cousin, we have moved them front and centre and the results speak for themselves.
Newsagents pursuing growth could achieve this by relocating their greeting cards to a higher traffic area. With the higher margin offered by cards the payback could be very rewarding.
Strengthening their position in consumer recharge, Australian newsagents are the exclusive retail channel through which the bopo reloadable prepaid VISA card is offered. Given the huge success of prepaid mobile phones, I’d expect the update on the bopo card to be very strong. Using newsagents as the retail front is smart because of our recognition as recharge points for mobile phones, iTunes, online games and other offerings.
The bopo VISA card, launched last week, is an offering from Bill Express. The press release can be found here.
Technology & Business is a well produced magazine full of out of date content and backed by a website providing free access to chunks of content from the magazine. Their target audience will access content found in this magazine sooner online from a range of sources at no cost. From a newsagent perspective, I make 75 cents per copy sold. The real-estate costs me $3.00 a month and labour managing the title another $1.00 a month. I receive four copies and am lucky to sell two.
For this title to work for newsagents it needs to offer a better return either through a higher cover price or higher commission. It also needs more relevant and timely content. If they want to persist with a $2.95 cover price they need to articulate the relevance of this price to prospective purchaser. Just making the title cheaper does not cut it.
My sense is that an online only model would work better for this title.
The TV ads for the new build a model BMW part series are still running and issue 1 has sold out. The upside is that the TV campaign promotes this publication as only available in newsagents. The downside is that it has been launched nationally without any trial – meaning that supply quantities are based on guesswork, leaving many newsagents without stock. We have been out of stock since lunchtime on the first day with no hope of additional stock. I understand the Australian distributors are endeavoring to address the situation.
What makes this more interesting is that it is the first partwork publication in a while which appeals predominantly to males. They ask about it quietly, as if embarrassed to be buying a model car magazine. Their reaction when told it has sold out is memorable. Women when told their partwork (make-up, paper craft etc.) is sold out is practical. The blokes get all sooky.
Newsagents love partwork publications. They are a vital traffic generator supply issues notwithstanding. The importer, their UK publishers and the Australian distributors need to sort out supply and stock management issues if partworks are to remain viable.
The newsXpress newsagent marketing group, of which I am a shareholder and Director, has for the last three years been developing a new greeting card season. Care and Friendship Week is about acknowledging people we usually take for granted. teachers, coaches, friends, neighbours, priests, team members … the list is endless. The idea is to acknowledge these people and thank them for their friendship. Okay, I know it sounds soppy. The in store material is all about reminding people to say thanks and while we are hoping for a lift in card sales, it is not as blatant a card season as, say, Valentines Day or Mother’s Day. People who do purchase a card are given a free 50 cent stamp.
Customers ask what Care and Friendship is. Once they hear the explanation, says it’s a good idea. A couple of people today made the comment that they wouldn’t see this running in any of the big stores – and that’s what I like about it. It’s a small shop promotion focused on the personal. Even if they don’t buy anything, they walk out with good thoughts about the business.
The newsXpress Care and Friendship Week campaign is a personal touch campaign which separates our business from our competitors.
We have signed a contract for the sale of our home delivery business which has been part of the newsagency I own since it was created. By divorcing home delivery from retail we can focus on one part rather than two. A home delivery specialist is taking over the home delivery business and we are expanding our retail business. So, it’s a happy divorce. More and more newsagents are making this move.
The latest issue of Digital Magazine News covering the digital magazine scene is available here. It contains an interesting article about work by Zinio in the adult title space. Over the counter adult magazine sales have all but collapsed as people access what they want in this area online and usually for a lower cost. BusinessWeek has a story about Playboy staff cuts announced yesterday.
What I don’t get about the whole digital magazine thing is why? Why take a product designed for one medium and move it to a more flexible medium yet ignore the flexibility. The successful online titles are those created purely for the online experience. Creating a magazine like (page turning experience) must only be considered a transitional strategy.
Success can be painful as this story about Good Medicine shows.
Sales in our store for this title are soft at best no matter what we do. This month, Good Medicine comes with a free music CD. It is also the feature title in this week’s Connections promotions – Connections is an excellent ACP Magazines initiative providing marketing support to newsagents. Connections’ promotions boost sales. Thanks to the display we created with the Connections materials we sold out of Good Medicine in eight days. We called the ACP owned distributor, Network Services, and spent too long on the phone begging for extra stock. They wanted to know why we wanted the stock. To sell of course! They offered us two copies. Eventually a supervisor agreed to provide ten. ACP/Network control the supply of extra stock because of the need to keep returns to a minimum. I understand that. We would be happy to order firm sale but that’s a whole other story.
There is no doubt, based on any reasonable assessment, that our request for ten copies was justifiable and ought to have been quickly actioned. That we had to beg for stock is de-motivating.
Newsagent competitors would not care. If they sell out of Good Medicine they will fill the pocket with something else. That newsagents chase extra stock, while a frustration for Network, is something to respect as it reflects our desire to build our businesses and serve our customers.
Magazine publishers risk, with some business rules, making newsagents less interested in growing their businesses. Please don’t stifle the entrepreneurs … unless you don’t want us.