Do you remember the early days of the internet, when it was predicted that print media was doomed? Well, a decade later, and while newspaper sales have been slipping, it seems we just can’t get enough of magazines with the number of consumer mags sold in the UK rising for the fourth consecutive year.
In fact, total sales increased by 14 million copies in 2004 to 1,339 million, equating to a £54m increase in expenditure to £2.03bn, topping the £2bn mark for the first time. The Advertising Statistics Yearbook 2005, published for the Advertising Association by the World Advertising Research Center (WARC), reports that the rise in volumes was most prominent in the weeklies market - the c-stores’ staple - which rose by 31m copies. Meanwhile, the average price of a magazine rose by 2p to £1.52 in 2004, with the average price of a weekly now £1.01 and a monthly £2.90. The latest Audit Bureau of Circulation (ABC) results for magazines for January to June 2005 show that news stand sales overall are up 6% year on year.
The Periodical Publishers Association’s director of marketing Phil Cutts says: “Consumer expenditure on magazines has grown in real terms every year for the past five years - more than £2bn per annum for the first time, according to the Advertising Association. Now in the sixth year of growth, the latest ABC figures and increases in volumes of magazines purchased indicate that consumers’ increasing appetite for magazines continues.
“The latest ABC figures are testament to the continuing strength of the medium. Last year’s focus was firmly on the men’s weekly sector, this year we are seeing more emphasis on the women’s weekly market, with strong increases for existing titles such as Closer and new launches including Pick Me Up.”
According to WHSmith News, Take a Break remains the top-selling magazine through c-stores (see box) with OK! coming in at number two. The appetite for celebrity titles shows no sign of abating with Heat, Closer and Now all in the top 10 sellers list through c-stores. TV listings are another core staple that no c-store should be without, with What’s on TV, Radio Times and TV Choice all must-stocks. Elsewhere, Auto Trader, particularly popular through forecourts, is another essential.
A closer look at the latest ABC figures reveals that ‘constant’ titles are down 2.5% year on year, highlighting the importance of launches and one-off titles to the retailer. So, of the new launches, which are worth keeping an eye on? Well, Grazia, the UK version of the Italian women’s ‘glossy’ weekly, posted its first ABC of 155,000, meaning it sells more copies per month than any of the monthly glossies. Also worth making room for are two titles launched earlier this year by IPC - the ‘real life title’ Pick Me Up and TV listings mag TV Easy earlier this year saw them take sales of 503,950 and 340,000 respectively.
Although newspaper sales have been falling over the past few years, there’s no doubt they still drive footfall into c-stores. The best-selling daily, of course, remains The Sun with an ABC of 3,343,386 (July ‘05 exc bulks), followed by The Daily Mirror at 1,686,573. The broadsheets have been busy downsizing and this tactic has worked well for the The Times, which is the only national daily to be up year on year for July with 658,243 (ex bulks), a rise of just over 8%. The Independent, however, is down nearly 4% on July 2004 at 228,396. The verdict is out on whether the Guardian’s imminent adoption of the Berliner size will take sales up or down. The heavyweight sales figures come with the Sunday papers, of course, with the News of the World at the top of the pile, selling well over three million copies each week.
The Association of News Retailing (ANR) represents the news interests of the Association of Convenience Stores. According to managing director John Lennon, it is pleased the Office of Fair Trading (OFT) - as part of it provisional conclusions on the newspaper and magazine supply chain - granted continued supply of newspapers, and welcomed the passive distribution of magazines.
He says: “The code of practice, which the wholesalers must abide by with regards to newspapers, will mean the supply of magazines - particularly weeklies which tend to be delivered with newspapers - should be treated the same. The argument that smaller retailers will lose out on magazine supply does not stack up. If wholesalers are supplying newspapers, as they are obliged to do, then they will still supply magazines alongside them.
“Wholesalers need customers and do not want to lose them. Moreover, I think the increased competition of an open market should make the wholesalers themselves more competitive which should actually improve the service for retailers.”
Lennon believes the future for newspapers and magazines in c-stores is mixed: “Traditional CTNs will continue to go to the wall if they don’t diversify to c-stores, as there are very few locations where they can survive. Newspapers are a good footfall driver for c-stores but take lots of hard work. Magazines, on the other hand, are not a footfall driver, take lots of energy and have potentially high wastage. It is a ridiculous category to manage and many c-store retailers are shrinking the magazine display and putting drinks chillers in their place to make the store more profitable.
“News/magazines are not the mainstay of the business for c-stores like they were for CTNs as c-store retailers must look at the entire ranges of the store. If this situation continues as it is, with no innovation in the industry and little help for the retailer, there will be a long-term adverse effect on the circulation of magazine titles.”
Lennon believes service is key for c-stores to compete with the multiples over newspapers and magazines but is up to wholesalers and suppliers to give c-store retailers a chance to be competitive. He concludes: “Small news retailers may not be able to compete with the multiple grocer on the quantity of magazines but they can compete on service and offer niche magazines.
“Because magazines and newspapers are fixed price products with fixed profit margins, the only way to improve profits is through the supply chain and through category management. The problem is there is no competition in the industry so there is no need for wholesalers to innovate or do anything differently to how things have been run in the past 50 years.
“It is up to the retailer to push for a better service from wholesalers. If passive service is granted then retailers should grab the opportunity as it will not only mean wholesalers can sell cross-territory but also that retailers can supply other retailers. There is potential to develop the business. The ones who could make a real difference are the publishers and the wholesalers.”
Make displays pay
Paul Sadler, head of circulation & trade marketing at H Bauer, which publishes women’s weeklies such as Take-A-Break, says: “The following pointers are designed to make it quick and easy for the consumer to find and purchase their magazine from your store. These five key points will help your customer select their favourite magazine and help you make the most out of the magazine sector. The key is to make their search and purchase decision as easy as possible”
1. Where possible provide full facings to your key categories so it’s clear to the consumer where their favourite magazine is displayed. Where this is not achievable, ensure you have as much of the recognisable logo on show as possible
2. Display titles within their given categories: puzzles, women’s weeklies, TV listings and so on
3. Always display branded titles with the regular magazine
4. Ensure magazines are displayed within their competitive set and category so your customers need only look in one place
5. Always use point of sale material when available.
Lionel & Yvonne Cashin run a CTN in Market Weighton, East Yorkshire and say for their business the news category is going from strength to strength.
Yvonne says: “News and magazines are the bulk of our business. We stock 1,500 titles and have a 30ft run with nine rows. The category has now increased to around 60% of our turnover, which is 20% up on when we took over 18 months ago.
“I see news and magazines as a reliable category. You don’t have to mess around with the prices, for example. And although there is a lot to it - such as the returns, which we do daily - I just see it as just part of the job. I do get sent some magazines I don’t require and I keep them a day or two and they go back. Fortunately, we’ve created enough space in the displays now to give new titles a go.
“Another help is that we’ve invested in good technology via CTN Systems and use this system on a weekly basis. It really helps to manage the category.
“We are also part of the NFRN’s Blockbuster promotions club and involved in a local initiative called the Northcliffe Partnership, which has a lot of promotions. One that is coming up is 12 weeks of half-price weekly magazines. We will be leafleting 3,000 houses soon for that promotion and we have a Christmas catalogue that we send out. We are proactive in that way, but you have to be in this business.
“Home delivery is the mainstay of the business. We deliver both newspapers and magazines and have 30 newsrounds.
“Newspapers can be a nightmare - just because of the little things such as them arriving without the magazines to insert. We complain to the wholesaler and they blame the publisher. It may get better when there’s more competition.”
Lionel says: “Whatever lines you put in the shop you have to treat seriously. That’s why we’ve shied away from putting too many lines into this relatively small space and concentrated on magazines and greetings cards alongside staples such as soft drinks and confectionery.
“Since we took over the business we revamped the shop and put new fixtures in with lighting at the top. The success is down to the revamp and sheer hard work.
“You must keep on top of the news category and dedicate one member of staff to magazines and do the returns on a daily basis. One of our strengths is that we sell a variety of magazines including specialist titles.
“People might laugh but Classic Tractor sells 12 copies an issue here; it’s a very strong point of the shop that we can offer people what they want.
“One thing we increasingly dislike about the category is partworks - mainly because getting people to pick them up is difficult. We’ve started to get them to pay for two issues in advance. Like anything else that is managed by exception, it can be a nightmare.”