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

Holiday shopping and magazines

The data is from a small sample (6 newsagencies) but from what I’m seeing the disruption in sales through the holiday period is least felt in specialist magazines (woodworking, model, warships etc) and in women’s magazines. That women’s magazines remain a powerhouse for newsagencies is no surprise yet our channel’s weak embrace of women’s magazines is. Newsagents could do more to embrace the category. At the moment they are part of the mosh pit of magazines whereas they could be treated as the jewel in the crow they are through special location; co-location; or other in store features. With new titles due this year newsagents run the risk of more women’s weeklies going moving outside the channel. In my own store any magazine promotion I run kick women’s weeklies magazines higher than all other categories.

0 likes
magazines

Podcasts are go! … in Malaysia

The Star newspaper in Malaysia proudly promoted its new daily podcasts on page one of its print edition yesterday. While the podcasts are actually coming from a sister radio station, they are badged as from the newspaper and this boosts the promotion of their brand beyond print and connects them with a younger audience. On the podcasts link page you can subscribe and download previous podcasts. Back in July 2005 I wrote this entry in this place about how podcasting could be used to build the retail newspaper product and help newsagents improve in store marketing. The suggestions are still valuable today. In the meantime it’s great to see The Star in Malaysia embracing the podcast medium.

0 likes
Podcasting

Newsagency childcare

It’s school holidays and parents bring their children into newsagencies to pass time. It’s the ultimate since Dad can go oggle at the porn which the kids read the comics and get into everything or mum can read the latest gossip while the kids get into everything. During school holidays newsagents lose more stock due to damage by kids or outright theft than at other times. Regular customers, if they dare venture out for a bit of shopping, have greater difficult moving around the store as kids, occasionally, run riot.

While I’m pleased to have a shop full of people I wish the ratio of browsers would not increase so dramatically during holidays while parents, aunts, uncles and grandparents bring their kids to my store and other newsagencies to pass the time of day. I’m a childcare provider with something for everyone. Newsagencies are the one shop the family can browse away from each other and all get satisfaction.

One lady yesterday read four magazines, telling her snotty daughter that mummy was working out what to cook for dinner. Mummy was not. She read her stars in each of the four magazines and then some gossip. While mum did that her child wiped her snotty nose on a kids magazine and then ran around the magazine unit making a right mess. Mum eventually scolded her and left the shop without purchasing anything.

Do I scold the mother, the child or myself for not being tolerant? Ugh! It’s damn frustrating seeing people show so little respect for your property. One time a kid urinated. Mum saw the mess, took the kid by the hand and left. If my cat urinated in my house I’d rub her nose in it.

I’ll be glad when holidays are over and our regulars venture out of their caves again. When it’s safe.

0 likes
Newsagency challenges

The newspaper of the future?

image.jpg
Plastic Logic has fabricated what they claim to be the world’s biggest flexible organic active matrix display reports editorsweblog (the image above is from their website). The display consists of a flexible, high resolution, printed active matrix backplane driving an electronic paper frontplane.

Once you add good power and the ability to be online all the time you have the newspaper of the future.

0 likes
Media disruption

Newsagents cut back while cinemas get plenty

The experts at The Age continue to cut back newsagent supplies while ensuring that cinemas have plenty of stock to sell. Every day at the moment it’s a battle to get supply figures to a sufficient level to enable you to have stock all day. Yesterday I was at a local cinema and at 5pm they had at least 50 copies of The Age there for anyone to take. Besides the frustration of the daily battle for retail sock there is the question of how the free product is handled from an audit point of view but then I’m not supposed to ask questions about that.

0 likes
Newsagency challenges

Is Uncensored the worst magazine ever?

Uncensored arrived on Australian newsagency shelves this past week. It’s a New Zealand magazine which the publishers and distributors want placed next to The Bulletin, Time and Newsweek.

I don’t like this title. It is the ultimate conspiracy theorist’s magazine. The production quality is poor and the writing quality worse. I’m not proud to have it on my shelf. To want it placed next to the other respected news and current affairs titles is an appalling decision by the publisher and distributor. The only product advertised in the magazine, besides a sister magazine and some dubious books is an ad for MAGNA-RX+, the “world’s #1 best-selling all-natural male performance formula”. Yep, a quality publication.

Uncensored is a perfect example of poor product which should not, in my view, get distributed in Australia.  That said, when you look at the numbers you can understand why. Magazine distributors receive a fee to circulate product like this through the system regardless of whether the title sells. Newsagents, on the other hand, receive payment only if the product is stolen. Of the $9.95 cover price, I get $2.48 if I sell a copy. I receive three copies and have to hold them for a month. I have been invoiced for the three this month and have to pay by the end of next month. I return what is not sold and I get the credit in March. So from a cash flow perspective, I’m out for at least 30 days. The display pocket the product takes costs me $3.00 per month and the title will use around $1.00 in labour for the month. So, I need to sell two copies to break even.

Uncensored is being distributed because the magazine distribution model in Australia allows titles like this through the system as long as the distributor is paid a fee for their efforts. That newsagents receive nothing and therefore carry the risk is a shameful big business versus small business imbalance.

I don’t deny the right of the publishers of Uncensored to publish this magazine. My complaint is with a system which makes my small business a stakeholder in spreading this trash. If they want to use my store they should pay and pay handsomely. I have good traffic and they want to access that. So they can pay. To leech off a system which makes me invest in their business and ideas is appalling.

I’m going to return Uncensored this week and claim the credit this month.

You can find out more about Uncensored from their website.

0 likes
magazines

More evidence of the collapse in music retail

Musicland, which operates an 800 store strong music retail group (Sam Goody and SunCoast) in the US filed Thursday for Chapter 11 bankruptcy protection. Forbes has the story.

Newsagents in Australia face similar challenges. More news and information is being accessed online. We are also facing tougher competition from other retailers adding to their news and information product offering in store. Newsagents need to respond with more cost efficient magazine and newspaper space and stock allocation. This means newsagents need to push back on some suppliers of poor performing product. We also need to extend our product range outside our traditional and into better margin product which have more control over. If we don’t do this our stores face bankruptcy like the Sam Goody outlets.

This is one of the reasons I became involved with newsXpress last year and have taken a financial interest in the group. They are taking my newsagency beyond the traditional and adding margin.

0 likes
Newsagency challenges

Confusing message from Fairfax

The Age is promoting Summer Crosswords Vol. 2 and Sudoku Vol. 3 for $12.95 each or $19.95 for the two. Their advertisement says the books are available singly from newsagents. Unfortunately newsagents cannot offer the dual pack. Also, newsagents have over 200 other crossword and Sudoku titles for considerably less than the price of these. If the folks at Fairfax really want to move these products then need better pricing and they need a consistent price for the consumer regardless of their purchase point. They also need a better retail story. This means providing newsagents with more point of purchase display materials.

0 likes
Newsagency challenges

Vodafone cut to newsagent commission

Vodafone has written to newsagents this week advising, formally, of the 37.5% commission cut on retail sales from 11% to 5%. In part, this letter says:

“Vodafone has an on going commitment to providing great value to its pre-pay customers through its value bundles and cap plans. This commitment has seen massive growth in the prepay category, including the sales of Vodafone electronic recharge vouchers.

Due to the cost of providing this value to customers, Vodafone hereby gives notice of a reduction to the retailer margins on the sale of electronic recharge vouchers.”

It is nonsense for Vodafone to make out that newsagents need to help cover the costs of providing value to customers. From what I understand they have not asked Coles and other majors to share the burden. If I am right on this, the Vodafone letter to newsagents cold have been something like:

Vodafone is in a battle for market share. It’s a tough fight. To compete we have had to cut prices and we want you to carry that cut for us. We can’t ask Coles to carry the cost of the price cut because, well, they are Coles. They would refuse to carry our product if we don’t give them 16% commission so we hope you understand. It was you or them so we went with you. Thanks for being a sport and accepting this 37.5% commission cut. Maybe you could pass it on by cutting employee wages or asking your landlord for a reduction in rent. Anyway, thanks for copping it on the chin.

Vodafone’s treatment of its small business retail channel is appalling on this issue.

0 likes
Newsagency challenges

CBS and their mobile strategy

MediaPost is reporting that the US CBS network is developing content for delivery over mobile phones. These three to five minute episode programs represent another major media company going outside its traditional supply chain in pursuit of consumer connect. Last week it was News Corp. and its video on demand launch (at the same time as DVD release). Now CBS creating content which is mobile specific.

Newsagencies are a supply chain created specifically for the delivery and retail of physical news and information product. Publishers who supply us will (more and more) play in the online and mobile spaces. Our 4,600 stores need to be pursuing strategies (which we control) today which provide us with relevance in this world.

0 likes
Newsagency challenges

Chicago Tribune drops stock listings

PaidContent reports that the Chicago Tribune has announced that it will cease publishing stock listings except on Saturdays. They are introducing a phone in service for people who want quotes – talk about a step back in time – as well as promoting online access. The paper points to the impact of the Internet as a reason for the change. Crosswords, Sudoku and quizzes are on the Net. Will they drop those from the newspaper as well? Newspaper customers are newspaper customers and a publisher pushing their customers online must have a plan.

0 likes
Newspapers

That’s Life, I guess

We didn’t get That’s Life yesterday. For some customers it’s like the end of the road. Wednesday is their day out and buying Take 5 and That’s Life is the cherry on their ice cream. For some reason, That’s Life didn’t make it to many stores yesterday and so our customers missed out on their cherry. Their sadness illustrates the emotional connection between some magazine titles and their readers.

0 likes
magazines

Podcasting and special interest magazines

A good article from the Miami Herald about podcasting. The example used illustrates the risk to newsagents and our range of special interest publications. As more podcasts are published readers of special interest titles will switch to listening rather than reading. Maybe not in all categories but some. Australian newsagents aren’t part of the podcast supply chain so we need to be playing elsewhere to ensure relevance.

0 likes
Newsagency challenges

Weekly magazine market is the powerhouse of sales

This story from UK mediaweek about yet another weekly title launch – this time involving Australia’s own ACP. Here in Australia weeklies are the strongest growth category from the sales data I see. Even in my own show where aggressively push magazines it’s the weekly titles which power further ahead of others. The challenge with new weeklies is that they alter consumer buying habits away from the traditional newsagency.

0 likes
magazines

Are newsagencies convenience or destination stores?

Historically the appeal of newsagencies in Australia has been broadly based. Our 4,600 stores are well located so we’re convenient. We have had an excellent and exclusive range so we have been a destination. As a result of more competition, the impact of technology and changes in consumer buying habits, newsagencies are losing (in my view) their destination appeal. Whereas previously our destination appeal was due to lack of choice, today it’s what we make of it.

Newsagencies are laid out and designed for the convenience shopper. The counter best illustrates my point. We all too often surround our counters with candy and other impulse items which customers can buy elsewhere. They are items under margin pressure. If we were more destination focused we would surround our counters with items more unique to our businesses and which are under less margin pressure.

Newsagents ought to stop listening to reps who knock on their door every day pushing product to the counter and make decisions for themselves as to the message they want at their counter for the good of their business. While some newsagencies in transit traffic locations will want convenience items at the counter, others in shopping malls and high street situations could be better served making their own choices.

If we make our stores look like a convenience stores they will think of us that way when considering stationery and other items whereas if we ‘own’ categories such as art supplies, greeting cards, stationery, specialty papers and stationery related gift lines they will think of us when they need these.

This has been on my mind these past few days because of a discussion I am having with someone entering the newsagency space in Brisbane. They want to push the newsagency they are buying into the convenience space even though there is a national brand convenience stores a minute from their front door. If they make the mve they;re no longer a newsagency and the channel loses one more outlet. nice stores they will think of us that way when considering stationery and other items whereas if we ‘own’ categories such as art supplies, greeting cards, stationery, specialty papers and stationery related gift lines they will think of us when they need these.

0 likes
Newsagency challenges

Magazine publisher marketing strategy costs sales

Some magazine publishers regularly bag back issues of a magazine with the current issue and label the sealed plastic bag 2 for 1 or even 3 for 1. Retailers often find bags torn open and at least one of the magazines missing.

The 2 for 1 offer is common in the craft (quilting, cross-stitch, scrapbooking) category.

Last week I was talking with a friend who is to crafts what Imelda Macros was to shoes. Every wall of her house is covered in quilt panels, cross-stitch and other craft things I cannot describe. She loves the craft and buys at least four magazines a month. She hates these 2 for 1 plastic bagged issues because she cannot see what what’s covered in the magazines unless she opens it. So, rather than asking at the counter for the bag to be opened, she leaves without purchasing. After she told me this story I watched on our CCTV in my store at least three customers in the craft section do the same thing. They picked up one of the plastic bagged offers, tried to see the second magazine, put it down and left.

Craft is a growth category but I’d bet the growth is stilted to this type of marketing.

I’d like to see publishers give newsagents the giveaway stock for storage behind the counter. This way customers can leaf through the current issue and then choose the free magazine they want. The publishers get to make their 2 for 1 offer and customers are more likely to be satisfied. Some newsagents will find the behind the counter approach problematic. Id; say it’s better than what happens today.

0 likes
magazines

Australia Post and magazines

The rumor put to me late last year about Australia Post publishing or at least partnering in publishing a magazine has resurfaced. This time it’s pitched to me as something Post would deliver and retail. It would be a weekly and aimed at women. While the rumor seems implausible, as a lever to get other magazine and newspaper product into their corporate stores or as a lever to get more subscription delivery business it’s interesting. I’m posting it here, even though it is a rumor, to see if the posting draws out other comments.

0 likes
Newsagency challenges