Enhance single-copy success by figuring out and delivering what retailers want

In one important sense, single-copy retailers are no different than other media consumers: they want what THEY want, not necessarily what the newspaper industry wants them to have. So said Dean Torrenga, regional vice president for Starbucks, and Vernon Goad, marketing manager for CVS, when they spoke with participants in the American Press Institute's seminar for single-copy sales managers, Single Copy: Reaching the Many Markets of One.

In the early 1990s, The Washington Post approached Starbucks about becoming a single-copy outlet. What was different about their approach, said Torrenga, was that they didn't come in with a list of reasons Starbucks should carry The Washington Post; they came in and asked what Starbucks' priorities were, and then came back with ideas for ways The Washington Post could help Starbucks with some of those priorities.

The result: The Post developed a win-win partnership with the retailer and was the first newspaper to be carried by Starbucks. The program created by The Post became the template Starbuck's used to rollout a national category initiative. Now Starbucks sells other local newspapers in its stores across the country, and the partnership with the Post includes not just newspaper sales but community partnerships and many other local initiatives. Both sides consider the relationship to be a true partnership, rather than one of vendor/retailer.

Torrenga said there are two main things newspapers that want to partner with Starbucks should know:

• Starbucks knows they need to be locally relevant, and they see a newspaper as an ideal way for them to achieve that. Torrenga said that Starbucks is not a newsstand and so they only offer no more than three newspapers in each of its stores. One of those is always The New York Times, but Torrenga stressed that another one should be the local paper for the community. The other newspaper is usually a regional title.


• At the same time, anything in a Starbucks MUST work to enhance the Starbucks experience. Torrenga stressed that Starbucks will never agree to anything that would compromise the Starbucks brand, and that newspapers need to be prepared to fit themselves to their retailers' brands and cultures, not the other way around. In this case, for example, it means providing blond wood racks that matched the rest of the store decor.

Torrenga's other suggestions for a successful partnership with Starbucks:

• They plan the big events on their marketing calendar at least a year in advance. They can fit smaller local things in, but he recommended trying to work with their schedule as much as possible.


• Starbucks knows the value of newspaper advertising in driving traffic and sales, so any time there's extra space in the paper, he suggests dropping in a Starbucks/newspaper house ad. At a time when a local Starbucks needs to boost sales, that kind of help from a newspaper is extremely valuable.

Both retail representatives readily acknowledged that newspapers help to bring customers into their establishments and provide a competitive advantage to the retailer in terms of availability and convenience.

However, Vernon Goad from CVS talked about a completely different set of things his stores need from its newspaper vendors: help in simplifying the process and with the costs. He pointed out that newspapers offer lower margins than any other products in the stores and they are the only product the CVS carries that comes from outside its own supply chain. This means newspapers don't get scanned at checkout, so CVS can't manage the inventory as it does for all other products, or gain any demographic data about purchasers through shoppers' cards. In effect newspapers consume more in inconvenience than other products in the store, he said, so CVS needs the newspaper to provide as much category management help as possible.

What has helped in CVS's mid-Atlantic market, Goad said, is that they only need to deal with only two newspaper distributors - the local wholesaler, NewsOne, and either the Washington Post or the Sun in Baltimore. This helps keep category management costs down, which Goad says he relies on as a way of offsetting the lower margins newspapers offer. He urged newspapers to work together to consolidate direct-store deliveries as a service to retailers like CVS.

NewsOne also worked with CVS and major publishers like The Washington Post to redesign sales racks for newspapers. Goad cited Washingtonian magazine as a publication his stores in the Washington area must carry, and noted that when The Washington Post and NewsOne helped redesign newspaper displays specifically for those stores, it made sure to include room for magazines such as Washingtonian as a way to help CVS drive category sales.

CVS starts its national marketing calendar 18 months in advance, Goad said. Local promotions work on a shorter timeline - they're typically planning a promotion 20 weeks out and starting the execution 12 weeks out. He too urged newspapers to work with that timetable.

From the newspaper side of the conversation, Ron Ulrich of The Washington Post reiterated that lower margins are the reason newspapers in many retail establishments are shoved off in the corner and not displayed well. We as an industry must work to make the newspaper as profitable as possible for the retailer, he said, either with bigger margins or by managing costs. And we need to do that well. He stressed that we're asking retailers to trust us to help them, so if we screw up operationally they bear a real cost and they're very reluctant to give us a second chance.

Ulrich also suggested that newspapers approach each retailer at least once a year to do a comprehensive "business review," to highlight things that are going well and to explore opportunities for strengthening the partnership.

Hugh McGarry from the Milwaukee Journal Sentinel reminded the seminar participants that at some retail establishments, the category manager's bonus may well hinge in part on customers' use of shopper cards, so if a newspaper is scanned at checkout, newspapers should work with the retailer to try to boost shopper card usage. In short, he said, we need to be a lot more flexible and "a lot less arrogant" in the way we go to market.

McGarry also suggested working with other newspapers to help manage the category for retailers. He reminded attendees that the most productive outlets are the ones that carry the most titles, so "check your egos at the door" and get together with other newspapers in the market to provide comprehensive service to retailers.