Wal-Mart Backtracks on 'Free Editorial' Demand to Magazines

31 July 2008

LONDON: Wal-Mart's European offshore supermarket colony Asda is currently the hate object of choice for the British magazine publishing industry.

Its crime? To 'request' from all distributors of titles stocked in its 356 UK stores …

  • Two free pages of editorial or advertising space each month in titles of the company's choosing.
  • A "space contribution" of £10,000 ($19,8k; €12.71k) in return for instore display space.
  • Plus an additional £2,500 per magazine title for each new Asda store opened.
  • An "item set up" charge of £2,464 for any new title distributed in its stores.
  • A turnover bonus to the value of 2% of its magazine suppliers' total business with Asda, to be paid quarterly to the supermarket and backdated to January 1 2008.
The demands were itemised in an Asda email recently sent to magazine distributors.

Its contents would certainly not have come as a surprise to manufacturers of foods and household products, who are resigned  to making "contributions" to the bottom line of the cosily-straplined "Wal-Mart family" and its peers.

But such ungentlemanly demands are hitherto unknown in the comfy,  closeknit world of UK magazine distributors where 'competition' is thought to refer to contests entered by crossword addicts.

Whinged a 'senior magazine publishing source' to MediaGuardian.co.uk: "Asking for a contribution for each line [title] in a new store is just not economically viable."

Complained another: "It's difficult to have a sensible discussion when the demands to pay are out of proportion with what we can pay." 

Soothed an Asda spokesman: "The email sets out a number of proposals aimed as a starting point to begin discussions.

"As with any negotiation, both parties have a wish list which will quickly change as middle ground is sought and an agreement that suits both parties is found."

  • NEWS FLASH: 8:03 July 31 2008
    Representatives of Asda on Tuesday met with magazine distributors and publishers to discuss the controversial proposals.

    At that meeting, Asda reportedly blamed the email demands on a junior buyer "who was naïve and new to the category".  The supermarket declined to comment on the seniority of the person who sent the e-mail.

    It did, however, backtrack on the most controversial of its demands. "Any reference to free editorial was a mistake on our behalf and shouldn't have been included. The email was very much a starting point to negotiations."

  • Data sourced from Guardian.co.uk and BrandRepublic; additional content by WARC staff