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Drug Chain Book & Magazine Business Review

Drug Chain Book & Magazine Business Review. Anderson News Company December 17, 2008. Sales Performance (Jan – Nov 2008). Annual Sales All Stores Comp Stores Industry Magazines $44.5 Million +9.1% +2.6% -4.0%* Books $14.5 Million +9.0% -6.8% +1.8%**.

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Drug Chain Book & Magazine Business Review

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  1. Drug ChainBook & MagazineBusiness Review Anderson News Company December 17, 2008

  2. Sales Performance (Jan – Nov 2008) Annual Sales All Stores Comp Stores Industry Magazines$44.5 Million +9.1% +2.6% -4.0%* Books $14.5 Million +9.0% -6.8% +1.8%** • Average magazine rack is 9 ft and sells $20 K • Average magazine checkout pockets 27 and 58 total pockets ($189 / pkt annually) • Average book rack is 9 ft and sells $6.5 K *Magnet Jan – Oct 2008 **Publisher’s Weekly Jan – Oct 2008

  3. Magazine Sub-Category Performance (YTD Dec 12, 2008) Jan – Dec 12 2008

  4. Top 10 Mass Market Authors (YTD Dec 12, 2008) Jan – Dec 12 2008

  5. Scan-Based Trading Performance • Overall shrink is -2.2% of net shipments (1st Quarter 2008) • Providing detailed audit data to accounts payable • Issue code in EDI data would improve accuracy of issue-level reconciliation • POS replenishment planned for 1st Quarter 2009

  6. Optimal Assortment Market Segmentation Product Segmentation Seasonal, regional, and competitive factors are also used to develop each store’s customized product assortment.

  7. Product segmentation to the switching level Games Lotto Lotto Special Interest Puzzles Sudoku Fill Ins Logic Variety Word Circle Crossword Difficult Easy General Large Print

  8. Redundant, inefficient product Segment saturation results in inefficiency

  9. Efficient assortment

  10. Chain A • 20 Items • 5 Varieties • Chain B • 20 Items • 10 Varieties Reduce redundancy and increase variety

  11. Markets profiled at block group level Indianapolis

  12. Markets profiled at block group level Orlando, FL

  13. Kaleidoscope model combines location with sales MarketProfile Store Specific Category Sales Customer Profile Profiling a store’s customers based on location alone can lead to inaccurate profiles.

  14. Magazines are Targeted Advertising Vehicles Affluent Family Hispanic African American

  15. Store profile based on sales and location Percent of Customer Percent of Market Cluster Group Middle Class Family 60.6% 40.0% Golden Years 16.4% 11.0% Hispanic 23.0% 15.0% Middle Class Singles 17.0% Affluent Family 11.0% Other 6.0%

  16. Cuisine genre indexed across cluster groups

  17. Recipe genre indexed across cluster groups

  18. Sales Probability as the Foundation of Distribution Distribution of sales for Motortrend accounts selling an average of 5 copies per issue.

  19. The Magazine Long Tail at Drug Chain

  20. Authorized List Using Store-Level Criteria Store-level methodology identifies strong regional titles like The Roanoker, Chesapeake Bay, and Southwest Art

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