Nonfoods Talk: Read All About It

Single-copy magazine sales have declined at supermarkets. Is it a temporary blip caused by the tough economy or the beginning of the end of the category?

What should grocery retailers do about their magazine departments?

That question will be asked more often in coming years as new technologies, including the latest versions of the iPad and Kindle, hit the marketplace and more consumers look to digital to get their news and trends.

Magazines have always been a big profit center for grocery stores for a number of reasons. One is because many—especially the so-called women’s titles—have traditionally sold well at food stores. A second reason is that magazines carry strong price points and high margins. A third is that many publishers have been willing to pay retail display allowances to retailers for room at the front end.

For decades, it has been a very happy marriage. Publishers had a great outlet to sell magazines to a decidedly female marketplace and retailers were making money from a segment that actually led to more sales at the store when many magazine readers would come back for ingredients necessary for those recipes in the issue.

But that could be changing quite quickly. The pessimists amongst us—some call them the realists—say that as the Baby Boomers fade out of the scene, younger generations will pay little attention to magazines, foregoing paper products for digital products at every opportunity. Many in this group suggest that retailers abandon their in-line magazine sections and dramatically pare down magazines offered at the front end.

The opportunists, of course, take a totally different tact. They say that magazine sales have been more impacted by the sluggish economy of the past four years and that as the economy rebounds, hopefully, so will single-copy magazine sales. They ask retailers to be a little patient with the magazine section with the promise that better days are ahead.
From this angle, they are both right.

There is little doubt that younger consumers are more reliant on the Internet for their information, whether it is news, fashion trends, sports scores and features or other information. These shoppers are simply not going to rush to a store to purchase a magazine for some later casual reading in the near future.

But that is not to say that these consumers will never pick up a traditional magazine again. To the contrary, I can tell you that the 20-something women in my office all seem to be reading a copy of one or another fashion magazine, especially during the late summer and early fall periods. They tell me that there is no way that the latest fashion designs can be offered to these shoppers in a better setup than a 700-page issue of Vogue or Cosmopolitan.

Also, the gossip periodicals, led by such titles as People and Us Weekly, continue to be extremely popular with consumers and, though sales may be down, these magazines still command a lot of interest among consumers, young and old.

So where does that leave retailers? The answer is that they should not give up on magazines just yet. The top titles will continue to post solid single-copy sales as long as publishers keep giving consumers what they want and are willing to make an impulse purchase based on the cover or a big story inside. That means retailers need to look at their mix of titles at or near the front end and determine what publications to keep there and which ones to no longer place at the checkout.

At the same time, retailers may want to take a real close look at the in-aisle magazine section. Here, it gets a lot trickier. It may be time to cut the amount of space—and the amount of titles—offered in-aisle. The days of offering hundreds of different titles no longer works because the consumer is no longer coming into the supermarket looking for specific magazines.

The magazine section is changing with every new sale of a smartphone or tablet. But giving up on this segment may not be a wise move quite yet, especially as many consumers demand their favorite periodical at the place where they have traditionally purchased them.

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