Does the Supermarket Checkout Belong to 7 Publishing Companies?
Consumers pushing their cart through Giant Foods, Loblaw's, Raley's, or any other supermarket chain in North America must think there are only 35 magazines published. People, US, Woman's World, Better Homes & Garden, Cosmopolitan to name a few that have pockets on every checkout in America and Canada.
This business model has been the rule for the past 50 years or so and has stymied growth, knowingly or unknowingly, of the magazine category in supermarkets, allowing other categories to edge their way onto the once "hallowed ground" owned by print media.
Some titles have even begun to place header cards saying, "Didn't get last week's issue? It's right here." But realistically how many people want to buy overripe bananas or week old bread?
Time to Introduce New Titles at Checkout
The sacred ground of the checkout should be opened to other titles and categories. After all when we look at what used to be called the FAS FAX, for the second half of 2015 we see that the Checkout title category is down 10.7% and mainline titles are down 2.9%.
Using MagNet last quarterly report registering all U.S. and Canadian single copy print sales Celebrity, Women's, Food and Lifestyle categories, the standard checkout mix are each down 15% or more compared to last year. What can be done to stop this loss in revenue to the retailer and the wholesaler, and help save the magazine category?
Make one full checkout fixture the "Alternative" fixture. Yes, this will create extra work for the wholesaler merchandisers with the unglamorous job of "dressing" the front end every week (removing not only off sale magazines, but discarded coffee cups and used tissues from the checkout pockets and putting in the new issues. Because now there will be one crate with non- standard titles for the "alternative" fixture.
What titles will work there? Whatever is popular at the time. Coloring books. Beer magazines. Alternative health magazines. History magazines (for example, if in the Mid-Atlantic or Southern states, Civil War magazines; Manga or skateboarding if in the Southwest or far Western states.)
Will it work? Yes. If we review ancient magazine history, in the 1990s, Vegetarian Times magazine was only sold in health food stores and bookstores. We were able to obtain a checkout pocket in D'Agostinos, a New York City supermarket with no mainline, with the help of the Hudson News Distributors. We sold well much to the disbelief of the agency, and our draw and sales steadily increased from the first placement in 1996.
There is a chain in Michigan, Busch's, which does not subscribe to standard checkout dogma and has titles like All About Beer, Taste of Home, Gluten Free Living, Simply Gluten Free as well as "typical" checkout titles -- and the magazines sell. All About Beer when I last looked at sales was selling over 60% of the copies shipped to all stores in the chain. Outstanding sales numbers no matter what category or title or retailer.
Leveraging Demographic Data to Sell Niche Titles
So how would a mass market chain do this? The chains know their demographics. They are not making product decisions based on a census profiles but on sales. Why else would one store have 6 brands of Feta cheese and a sister store 12 miles away have only one brand? They know their customer and their shopping habits.
This can be done with magazines. By allowing a niche magazine to purchase a single pocket in a chain, the costs are not as prohibitive. They are buying one pocket, not the usual requirement of 6 or 12 per outlet per chain.
The successful sale of the "new" magazines will begin to generate profits for each member of the distribution channel and the new additional cost of managing a separate checkout will be reduced. This has been done successfully with regional magazines when a chain is in multiple cities or states. Alan Centofante, a consultant specializing in regional titles has arranged, for over 20 years, to buy pockets and is able to make sure, for example, that Baltimore is in the Maryland outlets and New Jersey Monthly is in New Jersey outlets.
And, as consumer tastes change and new fads and interests are introduced, the wholesaler, working with the National Distributors and consultants can find new titles meeting new interests to replace the dying fad.
This can be frightening for the old guard. It will highlight MagNet's statistics that their magazine is not doing well at every checkout with double-digit losses every six months. This allows the wholesaler to make the retailer whole again, and spark new life into the magazine category.
Splitting ownership of pockets by targeting titles on the new fixture will not be challenging. Through MagNet we have store level information of what titles are popular down to the street level. We can build profitable alternative checkouts and rebuild the profits magazines have long delivered to retailers.
John Morthanos is a circulation consultant specializing in niche and
special interest publications. He was Vice President Specialty Sales at
Curtis Circulation Company, Vice President Single Copy Sales at Primedia
Special Interest Publications and Cowles Magazines, Circulation Director
at Viare Publishing, and Circulation Marketing Director at Ziff Davis