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Relaying magazines in your newsagency is the easiest way to increase sales

Before I get into my revised advice on how to do a magazine relay in your newsagency I remind magazine publishers and our only magazine distributor that newsagents are treated poorly by you – poor margin, out of date management practices and no ability for us to reasonably control the titles we have. We are time-poor because of your out of date practices.

I first shared advice on how to relay magazines to drive growth in sales back in 2006. Over the years I have shared updated advice here. The advice below is considerably modified.

How to do a magazine relay in your newsagency

A magazine relay is the process of recasting, improving, the layout of magazines in your business, with the main goal of increasing sales and a secondary goal of improving retail space efficiency.

Take all the titles off and put them on the floor. Clean the fixtures.

Start at the end closest to the front of the shop and rebuild, making careful choices as to what titles go with what as you go along. Try and not place as they were placed before. Change is important. Don’t overthink it because no layout is permanent. Don’t consult your data. Rio with your gut.

At the top of a column have the title people will recognise the most. Consider allocating two pockets to this same title. This is what they call beacon branding.

Adjacency placement is where you can make editorial decisions, business decisions to guide your shoppers. What works best with what. You don’t know, not for sure at least, how can you. Ok, there is basket data you could read … but that only tells you what is happening. What about what could happen? Who knows. Experiment!

For example, should you put model plane magazines next to flying magazines? Or, should model plane magazines be in a distinct section of all model titles? Do puzzle shoppers shop by brand or puzzle type. Publishers want you to layout based on their brand whereas your shoppers are, in our opinion, more likely to shop by interest. For example, all sudoku titles could work better together, or all large print titles could work better together.

Here are some adjacency suggestions.

  • Cricket, golf and swimming go well together. Wrestling, boxing and buff-type fitness go well together.
  • Soccer is not rugby or AFL. Don’t mix them together.
  • Classic car titles need to be distinctly separated from regular car titles.
  • Classic car titles work well with classic trucks.
  • Car lovers do shop by brand. Place branded magazine titles together.
  • People interested in home renovation could be interested in any renovation title.
  • Creative arts go well together: painting, writing, craft.

Once you have completed the relay, walk staff through it so they know what’s what.

Next, watch shoppers and listen for feedback and, after a couple of weeks, look at the sales results. The results could guide adjustments, or not.

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magazines

Is a newsagency a good business to buy in Australia?

It’s January 2024 and a good time to consider this question: Is a newsagency a good business to buy in Australia?

The answer on whether a specific newsagency is good for you to buy will depend on the newsagency, it’s past performance, it’s specific situation, the prospects for the region, your resources and your own retail skills.

But considering the question Is a newsagency a good business to buy in Australia? broadly, I think the answer is yes.

While what newsagents have traditionally been known for has changed, there is plenty of upside for engaged retailers prepared to play outside those now blurred lines of tradition. There are also excellent opportunities within plenty of product categories, including:

Stopping looking like a newsagency. Aussie shoppers have an expectation that a shop that looks remotely like a newsagency will sell what they think a newsagency should sell and will therefor not visit or visit depending on their assumptions. I’ve seen newsagents grow their businesses by not looking like a newsagency.

Gifts. This is easy and the opportunities are considerable. Whereas in the past gifts in newsagencies tended to be lower priced and bland, newsagents I see having success play in higher value niche spaces, and they do well from this. It takes investment, passion and commitment.

Stationery. Plenty of newsagents are reporting growth in stationery sales both in traditional stationery and with impulse purchase must-have stationery such as fashion forward journals and cool pens. It is in this second area of stationery that there is opportunity for even more growth if you engage with trends and stop thinking about stationery as purely functional.

Cards. With millennials and gen z shoppers we are seeing good card sales. But to win them you need to engage with the category in ways that some of the older card companies in Australia struggle with. I see plenty of newsagents growing card sales by being innovating in terms off where they pitch product and the ranges they offer.

If your question is whether a traditional newsagent is a good business to by where traditional to yo0u means lotteries, newspapers, magazines traditional functional stationery and cards then, I’m likely to say no as that type of business with an overall gross profit percentage of between 28% and 32% is flat or declining. But, that type of business can offer good bones for innovation away from the tradition. Again, the key is to pay a fair price based on the actual profit and loss numbers for the business – beware add backs that don’t make sense.

Newsagencies are changing hands, the businesses are selling. There are sellers and plenty of willing buyers. I think 2024 is a good year to buy a newsagency.

Footnote: I’ve not mentioned newspapers and magazines because these poor margin categories are of less interest to me. Newsagents have little or no control over the range of products they stock, no control over the sale price and are burdened with product management requirements that are rooted in practices that were out of date thirty years ago. These poor practices dictated by suppliers add to the cost of business and suppliers are yet to demonstrate an appetite to modernise despite years of promises and the often repeated claim that newsagents are important to them.

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Newsagency management

2023 vs 2022 newsagency sales benchmark study under way

I have started collecting data for a 2023 vs. 2022 newsagency sales benchmark study. While I am doing a whole of year comparison this time around for the whole of channel study, I’ll do a last quarter only study for a smaller group for anyone interested.

My goal for the main study is to get data from at least 120 businesses as this will provide sufficient a dataset to consider the total channel results.

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Newsagency benchmark

Predictions: 2024 and the local Aussie newsagency

Hey, Happy New year.

I think 2024 will see change continue in our channel. It will impact our businesses and the businesses of our suppliers. The changes will be driven by a range of factors including but not limited to the continued rolling disruption of print media, growth in the use of social media, further decline in engagement with appointment TV and radio, AI, AI and AI, migration of more over the counter transactions to online, settling in of work from home for many and more suppliers going direct to consumers.

That’s my (incomplete) list of drivers of change. Now, to the changes I think we are likely to see in the channel.

  • A significant increase in online sales. More newsagents will have websites. More revenue will be put through websites run by businesses in our channel. I expect 2024 to be the year of biggest online revenue growth for our channel that we have see.
  • More newsagents selling products that have not been been traditionally associated with our channel. While this will be especially seen in businesses selling online, there will be some physical shops that pivot to niche specialty with the newsagency part of the business a smaller pert.
  • Continued decline in print newspaper and magazine purchases.
  • Somewhere between 100 and 200 newsagencies closed (for a variety of reasons).
  • Greater growth in online lottery product purchase than over the counter.
  • New suppliers entering our channel to replace revenue lost in other channels.
  • More direct from manufacturer opportunities as general wholesaler models are challenged.
  • More use of AI in content preparation, business performance assessment and customer contact assistance.
  • More collaboration events to drive traffic spikes.

This list is irrelevant as it’s speculation. What matters is what you are doing in your business to make the most out of 2024. Only you can figure that out. Or, you can choose to do nothing and let the year happen as it happens. This would be a mistake I think. Given the changes we can see, I think it is vital to embrace change, to ride the wave, rather than be dumped by it. This is why thinking about what might be in 2024 is useful. It lets you think about what might be so you can be ahead of the wave.

I was to finish by mentioning AI again. I think its impact on newsagencies, business generally and society more broadly will be far greater in 2024 than anything we can possibly imagine today. Some impacts will be good, while some not so good. Those less negatively impacted will be those who engaged with AI early to be aware of the rapidly evolving tools, to know what to watch out for.

Hey, Happy New year.

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newsagency of the future

Newsagents handing back their newspaper home delivery runs need a service contract for dealing with poor newspaper publisher service

The two main newspaper publishers in Australia, News Corp. and Nine Media (Fairfax) have a poor track record managing newspaper home delivery they take over from local newsagents, regardless of whether it is a forced takeover or a voluntary hand back.

They replace what has been for 100+ years a local personal service with corporate impersonal processes.

Whereas newspaper home delivery customers could speak to someone locally with direct knowledge of the delivery situation, in the publisher driven model customers have to navigate impersonal and broken processes that pay little regard to the local delivery situation.

I think newsagents deserve a service contract to cover the first year of post home delivery option. This contract could include the following fees payable by the publisher to the newsagent:

  • $5.00 for each email contact by a home delivery customer to the newsagent asking about home delivery such as where is my paper.
  • $5.00 for each in-store contact by a home delivery customer to the newsagent asking about home delivery.
  • $10.00 for each phone contact by a home delivery customer to the newsagent asking about home delivery.
  • $25.00 additional fee for each engagement where the customer is angry.
  • $25.00 for each call or email contact with the publisher for matters not covered by the above.
  • $25.00 for each call that has to be made or email that has to be sent to the distributor asking where the papers are for the shop.
  • $50.00 per title for each day a newspaper is not delivered to the shop by 8am (or any other time as stipulated by the newsagent based on their early morning trading). The amount could vary based on the usual number of papers sold where the penalty should be double the usual GP$ for the day.
  • $100.00 per title for each day a newspaper title is not delivered to the shop. The amount could vary based on the usual number of papers sold where the penalty should be double the usual GP$ for the day.
  • 250% GP penalty for each newspaper given to a home delivery customer who missed a paper, the publisher cannot rectify and a replacement paper is given from the shop.
  • A flat insert or giveaway fee for each time the newsagent is asked to give something away with the newspaper where the fee is at least 10% of the cover price of the accompanying newspaper and is paid weekly as an automated credit to the account.
  • A fee of $50.00 per 15 minutes for any in-store visit by a newspaper pub lister representative.

I’d make reporting simple with no opportunity for dispute by the publisher for such claim and with payment monthly by direct debit initiated by the newsagent entering contact details (date, time, customer name) into a web portal setup, maintained and paid for by the publisher.

Of course, these fees will seem over the top to most reading them. I have suggested the figures I have so they act as an incentive to newspaper publishers to do better. I reckon can predict some of the reactions people will have reading this.

No publisher will agree to this.

Newsagents have to be kidding themselves if we’d agree to this.

This list is nonsense.

Who do they think they are.

I’m just happy to have given up home delivery, I don’t want to rock the boat.

I’ve moved on.

The response by publishers will be silence. They will ignore the suggestion. They’ll read it here and mutter about it to each other, but we will hear nothing because any request like this from newsagents has been treated this way, with silence.

I started thinking about the list when I saw a query from a long-term home delivery customer to the newsagent who used to deliver their paper to a nursing home. The newspaper publisher had not actioned a change request and the customer was becoming distressed after 4 attempts at contact. They reached out to the newsagent who ultimately organised for the issue to be fixed. They did this in service of a long-standing customer and because they understand personal local service. The newspaper publisher had let the customer down because of the corporate processes put in place to manage home deliveries.

Recently, we did not get the Australian Financial Review in one of my shops that ended home delivery a couple of years back. Two phone calls produced no result. Then, a couple of hours later, the distributor called a number not on the registered contacts list to say it would not be supplied at all. The person with that number had to call the shop. Next, the shop staff had to deal with customer queries and agitation. There were several unpleasant exchanges.

All of this costs money.

The newspaper publishers control the production and distribution of their product, yet they continue to expect local small business newsagents to provide free customer service to cover for their failures.

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Newspaper distribution

The Boxing Day opportunity for retailers

I see the Boxing Day sale as an opportunity to ditch dead stock and clear out any products we are discontinuing for whatever reason.

For me, it’s about decluttering the shop ahead of a reset for 2024, readying to lean into new opportunities in pursuit of new shoppers.

So, we price to quit. If the items on sale have long been paid for, the sale is about freeing cash for the business more so that chasing a profit. Stock sitting on the shelf not selling is not profitable.

With so many retailers doing sales this time of the year, it makes sense to ride on the back of their marketing coat tails and run a sale, even if in your location Boxing Day sales are not a thing.

There are people who have waited for this opportunity, and I’m happy to sell to them. Already this morning, up til 9:35am, $2,200 in sales of sale-priced items with nothing spent on marketing other than a bit of time on an email and some posters. The street is not busy, but people out are keen for deals.

On our street, we compete with Australia Post in the gift and greeting card space. They’re closed, which is good.

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Newsagency management

Online shoppers are powerful

Online shoppers tend to be savvy, and vocal if things go wrong. Being on the front foot with communication is key. This story was viral online well before A Current Affair picked it up. Now, on social media since the ACA story, the pile-on has surged.

While their comms could have been better and their back-office more organised, plenty of responses go too far.

In the last two weeks our own online businesses have shipped thousands of orders with half of those sent Express Post because of a supplier screw up that saw product arrive late.

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Newsagency management

The British relationship with magazines is so different to ours

Check out this video from Twitter a few days ago showing magazines featuring Doctor Who and (5) TV related titles in a UK newsagent.

I’m not pining for change. Rather, the difference fascinates me. I think it reflects a different relationship with print over all.

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magazines

Marketing tip: How to run a MY FAVOURITE MAGAZINE promotion

The range of magazines available in newsagencies is the one point of difference all newsagents in Australia share.  While there are other points of difference in individual newsagencies, magazine range is the one national point of difference.

Despite the challenges with the magazine distribution model, the migration of some print traffic to digital devices and other challenges around the print model I am confident that magazines will continue to play an important role in newsagency businesses for at least some years yet.  This is why I am always looking for and thinking about different ways to promote magazines in my newsagencies.

So, to my marketing tip for today, why not run a magazine focused shopper engagement promotion in your  newsagency…

MY FAVOURITE MAGAZINE

I see this as a very simple yet engaging in-store promotion.  It is unlike anything you would or could see in any other magazine outlet.  It is too customer engaging and too local to be of interest to supermarket, petrol and convenience outlets.

No, this promotion is designed for people who think about the magazines, people who have a relationship with the titles they purchase.

The idea is to engage with your shoppers about the magazines they like and through this to attract more shoppers to engage.  The subtle narrative I would hope for from such a promotion is: what a wonderful range of magazine titles there is in this newsagency and what a passionate group of regular and local shoppers who love these titles.  That has to be the goal for the more shoppers who realise the range and who connect with a regular visit the better.

Here is how I see a MY FAVOURITE MAGAZINE promotion.

  1. Set aside a fixed time for the promotion: two weeks, a month.  You decide and stick to this period.
  2. Before you start, review your magazine department, make sure that the layout is fresh and easy to navigate.  Also make sure that each section is anchored around a good strong title for that niche. your magazine department needs to sparkle!
  3. Find a space near the front of the newsagency for a whiteboard or a wall of paper on which you can post customer entries / notes.
  4. Headline the promotion space: MY FAVOURITE MAGAZINE and note some simple rules like:  Tell us your favourite magazine and let others share your passion.  You could a $50 worth of current issue magazines of your choice. Get your most creative team member to make this space look professional.
  5. Work out your own prize package.  While I’d recommend it be free current issue magazines, you choose the value, the frequency of the prizes and how many.
  6. Create a A5 entry form where they write: the title of their favourite magazine, some notes about why it is their favourite magazine and their name.  On the back have them put their phone number for contact purposes – maybe an email address to build your email database.
  7. Kick off the promotion with entries from every employee and their family members.  I think that a white board or a wall with notes already will look more interesting.
  8. Let the local newspaper know.  It could be a photo opportunity for them.
  9. Get your team to hand entries to every shopper … drive engagement from the counter out. This is not something o do just once, do it through the week to engage with difference shoppers you see.
  10. Offer pens for shoppers to fill the entries in then and there at the counter.  Encourage this with your team.
  11. Send entry forms out with you customer accounts, with a note explaining the competition.
  12. Keep a running total of the top five magazines by popularity of entries.  maybe augment this with a list of the top five selling titles.  This is where a white board can help as you can change it daily – butcher’s paper is just as good.
  13. Encourage your team to hand out entry forms to browsers, yes even those who browse and never purchase. Who knows, getting out onto the shop floor and into the magazine department may lead to engagement which drives purchases.

That’s pretty much it.  As I said, this is a simple and local campaign designed to show off an important point of difference between your newsagency and other non-newsagency magazine outlets nearby.

I have not run this promotion as described.  It’s only something I have thought about in this format this week. I have run promotions where customers vote and others where we focus on top sellers in categories – but nothing like this where customer opinion and feedback for the magazine titles about which they are passionate is so vital.

If you try this marketing tip please share with us your experiences.  Also, let your magazine distributors and key publishers know.

Magazines are vitally important to the newsagency channel.  The value we harvest is up to us.  Local engagement around our point of difference is vital over the next couple of years.

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magazines

Christmas theft advice for newsagents

I first published this advice to the 1,700+ newsagents using the newsagency software from Tower Systems a few weeks ago.  I publish it here because of  the concerning number of recent thefts in newsagencies.

With sales up and cash in the business up, Christmas time is the time for newsagents to be more vigilant than ever in managing cash. From taking care at the counter in customer interaction to ensuring honesty of employees, now is the time to revisit processes to ensure that the business is protected.

  1. Use employee initials or codes for each sale. Yes, this adds time to each sale. The benefits far outweigh the time cost.
  2. Require that the amount tendered be entered for each sale.
  3. Run refresher training on handling giving change to customers.
  4. Remind your team about counterfeit notes.  (See my blog post yesterday on this.)
  5. Give out receipts for all sales over, say, $5.00.  This helps you avoid disputes down the track if someone asks for a refund.
  6. Be on the lookout for over the counter scams by customers – scams around change given or getting free mobile phone credit.
  7. Take a zero tolerance approach to end of shift balancing.  All too often I see newsagents turn a blind eye to cash being out by $50 or even $100.  Good Point of Sale technology when used properly can help you drive zero tolerance.
  8. Do spot cash balancing during the day, at random times.
  9. Use stock control for high at-risk items such as cigarettes. This will quickly identify a theft problem. Indeed, you should use full stock control for all stock items.  Ideally, you will use stock control for everything.  Not managing stock on had in an invitation to be ripped off.  No excuses.
  10. Talk to Tower Systems about theft check options within our Point of Sale software and the FREE Theft Check Service for newsagents.

Yes, some of these measures take time. The financial saving from greater vigilance to the business could be considerable. Christmas in retail is a time of higher than usual risk.

Take care. If I can help in any way, please contact me.

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Newsagency management

Julian Assange to help sell Time magazine

assange-time.JPGThe Julian Assange cover of Time magazine presents newsagents with a perfect opportunity to achieve excellent incremental business with this title.   We have it placed prominently with newspapers.  His arrest in London and the controversy around the WikiLeaks have ensured that Assange is easily recognised.  This is another example of the attention we need to give to magazine covers.  Covers like this one on Time magazine can drive sales.

Other retailers of magazines are unlikely to be tactical in placement based on a cover.  This is another way we can demonstrate our point of difference.

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magazines

How much do newsagents spend on marketing?

I am curious about how much newsagents spend marketing their retail businesses outside their four walls on: advertising (newspaper, TV, outdoor), direct mail (catalogues), sponsorships (sporting and community groups) and in other promotions designed to promote the business outside the business.

I have always used 2% of revenue as a guide to marketing spend. By revenue I mean commission from lotteries, transport tickets, electronic voucher and agency lines plus sales for everything else – newspapers, magazines, stationery, books, calendars, diaries, ink etc.

Two newsagents I was talking with this week did not have a budget so we worked out the number. In calendar 2009 they spent under half of one percent of revenue on marketing. They were shocked when I suggested they quadruple this. They felt that being a newsagent should bring people in and that newsagent suppliers should do more to advertise newsagency businesses.

While I can understand the view that newsagents suppliers should promote the channel from a historical perspective, it is not appropriate today. Most of what we carry is in so many other retail channels that it is not appropriate to expect a supplier to promote us.

We need to market our businesses to bring people to us. This is best done in our local communities. All of what we spend in my newsagencies is designed to get people living and working near us to visit for seasonal, category and sale opportunities we promote.

We use a mix of direct mail, email and print advertising consistently throughout the year. This investment does bring in new customers. It also guides existing customers to spend more. The investment pays off.

While it is expensive to find a new customer, this is vital given the competition from other channels attracting shoppers to what we sell.

So, what do you spend as a percentage of revenue?

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Newspaper marketing
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