RETAIL PANEL DISCUSSES MAGAZINE SALES ISSUES

JOEL ELSON

DALLAS -- Supermarket nonfood executives spoke out on issues affecting the merchandising and sales of magazines after an industry executive accused the grocery trade of too often ignoring the category.

Michael Porche, executive vice president at DSI, a magazine- service firm in Boca Rotan, Fla., told a retail panel assembled here last month for the second annual Marketing Magazines Retail Conference that some retailers continue to treat the category as a second-class citizen in nonfood. The conference was co-sponsored by the Magazine Publishers of America, the International Periodical Distributors Association and the Periodical Wholesalers of North America.

"There's a general feeling that magazines have never been fully integrated into the fabric of this business," said Porche.

Despite magazine's high shelf turns and ticket rings, Porche said some in the industry have suggested that publications in particular "have tended to be an afterthought in supermarkets' store design. Also, magazine register-display racks are added randomly as space permits."

Store planning and operations executives typically fail to include magazines on checkout fixtures at the initial stage of new store design, he asserted. Thus, periodicals' placement and sales are weakened. "The difference between a well-placed department and a poorly situated reading section can be as much as 50% in volume," Porche said.

He pointed out that checkstand publication pockets must compete with a multitude of items like greeting cards, soda, snacks, ice cream, film, batteries and razor blades, even though sales of magazines at checkstands account for 55% of magazine category sales. In response, Bill Mansfield, vice president of nonfood at Marsh Supermarkets, Indianapolis, said he advocated "disciplined clutter" at checklane racks and would slide a sleeve of Krazy Glue onto front-end fixtures at Christmas.

Jeff Manning, vice president of general merchandise at Bashas Markets, Chandler, Ariz., admitted that the number of food companies contending for supermarket checkstands has "almost become a free-for-all."

Yet, he said, "You can never put too much out there. The customer is always willing to buy, and there are many impulse items."

Commenting on a Coca Cola study referred to during the conference that showed weekly magazine sales per checkout outsold candy two to one, Manning said he doubted that food retailers really know if space at checkout is being used in the best way.

The panelists also stressed the importance for publishers and news distributors to develop merchandising strategies that drive sales in their stores. In some chains, upper management and merchandisers don't understand the purpose of title repetition at checkstands, Manning pointed out.

"They don't understand why having that particular title at every checkstand is important," he said. "There's a lack of education on our part, and also a lack of numbers from the industry that let's us know how magazines perform on each of those checkstands. We need that information to take to upper management and show them what's actually performing and what isn't," said Manning.

Scott Gehrke, director of merchandising, technology and category management at A&P, Montvale, N.J., agreed. "As a retailer I can never know as much as the people living and working with magazines everyday. I need that expertise brought to me in the planning stage."

When A&P started selling soda at two checklanes about six years ago "it was a time when there was a mad rush to checkouts (with items other than magazines). There wasn't a lot of thought about what impact it would have on magazines," Gehrke recalled.

"Management's perception was that in a store with 15 checkouts, who would miss two. Customers that wanted a magazine would find them," he said.

After A&P removed magazines from the two checklanes "sales of TV Guide dropped 40%, which shocked management," Gehrke said.

Mansfield, of Marsh Supermarkets, recommended appointing a person in each store to monitor movement of items placed at the front end, as well as contracts with suppliers for front-end positions.

"All contracts and merchandising changes through one person would help eliminate some problems, and tie the measurement process together," he said.

Category management is the key that Manning believes will unlock display space for publishers. Once wholesalers become category managers, "publishers will have greater input in space allocation for their selections," he said.

He also urged publishers to follow the lead of greeting-card manufacturers in providing merchandising strategies and marketing information. He urged the industry to attend major industry meetings and conventions held by the Food Marketing Institute, General Merchandise Distributors Council and National American Wholesale Grocers Association.

"[Greeting card suppliers] are very active in the [food] industry. They support it and do research in other categories to see how they stack up against greeting cards," he said.

If magazine publishers were to emulate the greeting-card manufacturers, "they'd hit a home run." said Manning.

In addition to discussing these issues, the panelists asked news distributors to provide more timely weekend deliveries.

Gehrke, of A&P, who said the chain began operating stores on Sunday 20 years ago, favors preweekend delivery of magazines. "We'd like to get the freshest products during the times of the highest volume. It's that simple."

Sunday has become the second-best shopping day of the week for Giant Food, Landover, Md. About 60% of its magazine sales are made Friday through Sunday, stated Mike Centra, category manager for general merchandise and health and beauty care. "Offering customers the freshest products at peak consumption time allows us to get as much productivity from the category as we can," he said.

Equally important for Giant at these peak periods is proper maintenance of magazine racks by news distributors. Centra encouraged suppliers to shift their service schedules so that "we get the service that coincides with this heavier weekend traffic. It's one thing to have someone dress your racks on Friday, but the other two days, during the peak sales period, aren't as well prepared." he added.