Partnerships put magazines and retailers on the same page

Drug Store News, April 9, 2001 by Jennifer Kulpa

It's like George W said: We've got to work together.

That oft-repeated presidential inaugural theme hovered over last month's Magazine Publishers of America conference, attendees said. With their industry's numbers about as promising as voter turnout stats, "It's time to pull together as an industry," summarized Ann Finn, MPA's consumer marketing vice president.

At press time, figures were still being finalized at publishing newsletter The New Single Copy, but publisher John Harrington reported that "sales are flat to a little soft for the year 2000, particularly in the last quarter. For total retail, I think we'll show a 7 percent unit decline and a 2 percent decline in dollars." Sources agreed that while the general economic slow-down is partly to blame, all parts of magazines' supply chain could perform better with cooperation.

Getting down to specifics, Finn pointed to strategic partnerships with retailers as the path to mutual benefit. But just like politics, you have to be a certain size to get into the debate, and right now it's the large publishers partnering with their major clients and demanding that retail deals be national. This sets up two different retail strategies: traditional in-store merchandising for all and special programs for chains large enough to get them.

Platform 1: a contest of merchandising

Retailers of all sizes participate in this contest to grab an unsuspecting customer's eye. "Books and magazines are positioned as a convenience/impulse category. We have positioned it in a highly visible, high traffic aisle near checkout," said Eckerd category manager Kevin Osborn.

In a similar move, Kinney Drug placed magazines in the busiest department at its 59 stores: convenience food. Explained buyer Ken McClear, "Unless you're going in to buy the magazine or book, if you don't see it, you won't even think about it." Half of Kinney's stores currently feature this layout, as will all new and remodeled stores. And early results show category sales at Kinney are "holding their own or slightly up," McClear said.

Placing magazines in more than one area is also common. "Magazines help link our customers to the products we sell. That's why we cross-merchandise them near products, as well as at the check out and in our mainline section," said CVS spokesman Mike DeAngelis. "Cross-merchandising with other products we sell and co-marketing efforts also help drive sales by positioning the product where our customers expect to find it and see it advertised," he added.

Eckerd, too, uses additional placements. "Health and fitness, baby and beauty magazines link well with our product offering. We're outposting those titles in adjacent product areas," Osborn said.

From the supplier perspective, of course, the more the better. Cort LaMee, Time Inc.'s distribution services sales director for drug, reported that sales of cross-merchandised titles grow 40 percent and that auxiliary display has occurred recently in drug stores for Sports Illustrated's swimsuit edition and the late-Dale Earnhardt special issues. Going forward, "The major drug store retailers will display In Style's makeover issue at their cosmetics area ... we expect not only huge gains in sales for the title, but also for cosmetics-related products merchandised close by," he said.

Similarly, People special issues like the "25 most intriguing People," are merchandised at some chains with customized displays, posters and shelf talkers, according to John L. Brown, vice president of consumer marketing. "[Chains] are incentivized [to take full part in those types of programs], because where we'll sell about 1.4 million regular issues a week, for the special issues we will sell up to 2.3 million copies--and at a $1 higher cover price," he said. People generally stages such promotions with mass merchandisers and supermarkets.

Another example of thoughtful merchandising is seen at the Duane Reade on Fifth Avenue in New York City, where a rack of books is kindly paired with a rack of reading glasses. Albertson's, too, has taken the opportunity to leverage the natural synergies that exist between its magazine set and its business in remedial eyewear. To maximize its reach among the growing senior population, the chain has devised a small display of readers it merchandises with magazines.

It all comes down to the 3.2 seconds in which the shopper makes a checkout decision, explained Brown: "Getting the right copies to the right stores is one thing ... The other issue is, once it is there, what happens to it. For magazines, they need to see clearly what is being presented, or you're dead in the water," he said.

That's the idea behind CVS's new lighted wall fixture and new magazine racks at the pharmacy checkout--displays that will roll out chainwide this year, DeAngelis noted. Friendly pharmacy placements are especially important, because "as many as 50 percent of the customers in a drug store visit the pharmacy only, pay for their prescriptions and leave," LaMee noted, recommending titles such as Prevention and Time Inc.'s Health for this section.