Cellphones killing checkout-aisle sales
Magazine purchases drop as consumers turn to ‘mobile blinders’ while waiting in line. OLGA KHARIF reports.
For years, publishers could count on bored shoppers waiting in the checkout line to pick up a magazine, get engrossed in an article, and toss it into their cart alongside the milk and eggs. Then came “mobile blinders.”
These days, consumers are more likely to send a quick text and check their Facebook feed than to read a magazine or develop a momentary craving for the gum or candy on display. That has spurred companies such as Hearst Corp. and the Coca-Cola Co. to reconsider how they showcase their wares in supermarkets.
Hearst, which sells 15 per cent of its U.S. magazines at retailers, is adding cardboard displays in places other than the checkout line. And consulting firm Leo Burnett/ Arc Worldwide says it has worked with Coca-Cola to add soft drink coolers to locations like the supermarket deli.
“We avoid the dreaded cellphone at checkout,” said John Loughlin, general manager of Hearst’s magazine unit, which includes titles such as Cosmopolitan, Seventeen and Esquire. “Magazines are an impulse purchase, so we have more than one opportunity to capture the consumer’s attention.”
The problem has worsened in the past 18 months, as more than half of all Americans now carry smartphones, Loughlin said. Single-copy sales of U.S. consumer magazines fell 8.2 per cent in the second half of 2012 from the year-earlier period, according to the industry group Alliance for Audited Media.
The gum category also “has been challenged” and declined 5.5. per cent last year, Hershey Co. CEO John Bilbrey said during a conference call in January.
The problem of “mobile blinders is a huge factor,” said Marshal Cohen, an analyst at NPD Group. “Companies have to rethink the in-store experience.”
To catch consumers by surprise, companies are setting up more temporary cardboard displays around stores, sometimes offering unexpected combinations of products. Shoppers browsing the aisles of 1,500 Kroger Co. supermarkets may stumble upon a display offering a $3 discount on a sixpack of Diet Coke and an issue of Cosmopolitan.
Similar promotions will appear in CVS Caremark Corp. pharmacies and Target Corp. stores this year. Hearst is preparing 20 instore campaigns with the likes of Coke and L’Oreal SA, up from four in 2012, Loughlin said.