DALLAS -- An informal test on Albertson's books and magazines indicates positioning, not size, is everything.
The test, run over a six-month period at eight Albertson's units in Houston, compared sales of a 24-foot L-shaped display of books and magazines, positioned at the front-end near pharmacy, with 50- to 60-foot in-aisle sections. It was found that the front-end display generated higher sales and profits than in-line reading centers.
Albertson's decided to test the different merchandising formats when front-end displays were removed and reset in-line at four of the test stores last year.
Stan Carter, marketing account manager for the Boise, Idaho-based chain, explained the significance of the test and the retailer's approach to selling books and magazines at the Magazine Retail Advisory Council's Retail Conference on Marketing Magazines held here last month.
"Location is everything for the book and magazine category. Putting them in-line, in our estimation, is not a good call," Carter said.
He said the test showed that larger reading sets "tend to maintain sales, while inventory and returns increase substantially." Even though larger reading sections offer larger assortments, "sales may not necessarily follow. A better approach would be to grow the category with sales events," Carter stated.
David Parry, vice president and general manager of the Dallas branch of ETD KroMar, Albertson's book and magazine wholesaler, agreed with Carter's assessment that the front end is best for reading centers, "provided the space allocated is large enough to make an impact," he said.
An Albertson's L-shaped reading center runs 24 feet and is faced by a separate two-sided 8-foot island fixture with two 4-foot endcaps. Parry said the sets are large enough to draw shopper interest.
He believes, however, larger in-line sets can be effective too if the area opposite is open. In Albertson's case, there is a facing gondola across from periodicals that tends to block the shoppers' view of the department, said Parry, and this may be hampering sales movement. "An in-line section that faces a heavy traffic area like produce or dairy would have the level of exposure needed for customers to notice the department," Parry commented.
Carter said the chain has avoided placing reading centers near high-demand aisles like meat or dairy. "People with meat, milk and eggs on their minds don't notice the reading area," Carter asserted.
Although the retailer considers magazines and books a peripheral category, the reading center remains a very profitable department, producing high register rings for the company. Carter declined to give specific sales or profit figures.
Albertson's game plan in developing category volume, Carter explained, is building sales from within existing departmental space rather than creating larger sets. "The publishing industry thinks that to get more sales you just add product. But bigger isn't necessarily better," Carter said.
Because books and magazines are a high impulse category for Albertson's, the chain attempts to "catch customers the first six seconds as they enter."
The retailer also has transformed its reading sets into more book-oriented sections, with books accounting for 60% of the mix, and magazines 40%. Given a choice, the retailer would much rather sell books than magazines, due to their better margins and higher tickets.
"If we had a small set, I would be just as happy to have nothing on it but best sellers and famous authors. We'd prefer to sell a book at $7.99 compared to $1.99 [for a magazine]," Carter stressed.
The chain adjusts its book title selections according to pocket spaces available at store level. Stores with 100 pockets get best sellers and new releases, those with 150 pockets also carry Westerns and science fiction titles, and at locations with 200 pockets nonfiction choices are added to the mix.
Positive category growth has led Albertson's to incorporate books and magazines in initial store designs, rather than as an add-on section.
Carter said the sentiments he expressed at MPA's meeting two years ago still ring true. "The biggest opportunity for the distribution end of the industry is to get out of the distribution business and into the sales business. You can sell more John Grisham books than some other titles."
During the Super Bowl period, Albertson's ran a Super Bowl memorabilia magazine promotion that tied in with the Denver Broncos. The promotion "was a killer of a sales event, thanks to Time Distribution Services," said Carter. The magazines were displayed on tables and generated "huge volume."
The chain takes advantage of cross-merchandising opportunities. It displays parent's baby books in the baby care aisles. Cross merchandising "is a great idea but we're not really sure the books stand out enough because of their quiet covers. They probably could use a little more flashy cover," Carter added.
While cross promoting books and magazines in related food aisles may be a sound strategy in boosting periodicals volume, Carter said problems can develop when wholesalers forget to service racks, which become empty, and covers tend to get dog-eared.
He encouraged publishers attending the meeting to highlight pricing information more prominently on covers of special lower-cost editions of top-selling authors like Patricia Cornwell or Robert Ludlum.
Special lower pricing usually appears on margins where it isn't noticed, Carter noted. Books priced lower than regular retails should clearly state the savings are off the regular cover price to motivate added sales, Carter said.
According to Carter, distributors aren't servicing the retailer when they fail to bring in specially priced issues or editions, or don't order special-event products from publishers.
Albertson's shies away from meet-the-author events in stores simply because past events have not attracted heavy crowds. He said the chain feels it is not the proper venue for these activities, and that ads aren't usually designated to hype such programs.