Sahil Merchant – Chief Magazineologist of Mag Nation
Mag Nation was the brain child of former management consultant, Sahil Merchant and his partner, ex-pathologist Ravi Pathare. They saw the magazine retailing market as drab, homogenous and lacking choice of product. It also bothered them that browsing through magazines in most stores was generally discouraged because retailers held the view that browsers weren’t buyers. Merchant believed that this viewpoint was flawed and was of the opinion that buyers should be encouraged to spend more time browsing in store. In his view, the more time a person spends in a store, the more likely they’ll come back and this increases their chances of making a purchase.
With this in mind, Merchant put together a business plan. At the time, he was on the cusp of securing a more senior and highly paid role after years of climbing the corporate ladder. Just a week before he and his wife were to have their second child; Sahil quit his job. Craving more fulfilment, he set out to pursue his dream of running his own business. Sahil approached countless investors but most failed to connect with his vision.
“I must have knocked on 100 to 120 doors and many of those I tried several times,” he says. Through sheer tenacity and determination, Sahil stuck to his guns and finally, he managed to secure a number of investors who saw the potential.
“It took about four months before I saw any seed capital and twelve months to source additional funding to launch new stores.”
By March 2006, Mag Nation was ready to open its doors. Before the store could even open its doors it began to arouse the curiosity of passers by and a day prior to the store opening it had already gained media publicity with Melbourne newspaper, MX.
Part of Mag Nation’s allure was its point of difference. There was not a magazine retailer like it and it contravened many of the conventions most magazine retailers follow. Perhaps the biggest point of departure from your run-of-the-mill magazine retailer is in the fact that the store is designed to encourage people to browse. As you enter the store, there is a sign saying, “Take your time, enjoy a coffee, and remember that everything at Mag Nation can be touched, felt and browsed… except for our staff”. The store is a two level art deco store with an extravagant fit out which encourages people to take time out and flick through the magazines at their leisure. There is even a returns box for those who are not comfortable with placing them back on shelf.
Unlike most other magazine retailers, Mag Nation has also built its reputation on stocking predominantly niche products in addition to the mainstream offerings. On its shelves, the customer can find anything from a two dollar horse racing magazine through to a 195 dollar Italian fashion title. According to Merchant, Mag Nation has a magazine catering to almost any niche you could think of. “We cater to special effect artists, chess masters, medieval archery fanatics, high end fashion designers, even professional magicians. Then there are the countless customers who are looking for more standard titles, but want the latest air freighted issues that can’t be found elsewhere,” he says. Merchant – who calls himself Mag Nation’s Chief Magazineologist – says that the store is now a destination for people with special interests and a number of titles are exclusive to the business. Because much of his product line is interest-specific, he believes that stock movements are a reflection of wider social trends.
“Through stocking over 4,000 magazine titles that cover nearly every niche interest you could think of, Mag Nation is in many ways the ultimate social barometer. If street culture and stencil art is hot, we will see it reflected in sales of those magazines. If knitting is seeing a revival, our knitting range will spike. A new Playstation console comes out and the gaming section goes crazy. Magazines respond to social trends and our product range ebbs and flows according to these movements in popular culture.”
To reflect the dynamism of social trends, there is a favourites section at the front of the store which is updated twice a day according to the inflow of new titles. To keep the store vibrant and interesting for regulars, product displays are changed daily and category flows are altered every six months.
Sahil also chooses a less conventional path in promoting his business. Mag Nation does no mainstream advertising. Instead, Merchant runs witty viral marketing campaigns that offer free coffee to those who quote secret codes, emails his customers on their birthdays offering them a magazine voucher and sends sporadic e-newsletters to customers on his mailing list.
In store, Mag Nation also runs theme weeks. In conjunction with T-World Magazine, the store held T-Shirt Week, where the store was completely decorated in t-shirts. The same was done for Sneaker Freaker Magazine where t-shirts were replaced by 300 pairs of sneakers. To promote a knitting magazine, the store hosted a “knit in” where 50 people came into the store one evening to knit, eat sushi and drink wine. The store also held a stencil art week where they commissioned Melbourne’s street artists to display their works in store in conjunction with Pol Oxygen Magazine.
In a bid to expand its brand presence, Mag Nation has recently launched its own magazine based catalogue. It is also launching an e-commerce website and is extending its brand presence into cafes in Melbourne’s chic retail precincts.
The business’s innovative approach doesn’t stop at the shop floor. Mag Nation has also made a significant investment in its back end processes to ensure stock is timely and efficiently monitored.
Mag Nation’s innovative approach to magazine retailing is showing signs that it will pay off. Since its inception, it has grown from 400 to 1800 walk ins a day. The store is now featured in Melbourne’s Shopping Secrets, and was also a field trip as part of the RMIT School of Journalism’s curriculum.
Facing some tough contenders, such as Helsinki Bear, Fur Hair and Wunderkammer, Mag Nation gained significant recognition when it took out this year’s ARA City of Melbourne Lord Mayor’s Innovation Award which was presented by John So at Champions in Federation Square. The award was based on the business’s point of difference and its contribution to the vibrancy of Melbourne’s CBD retail precinct.
Business publication, Australian Anthill Magazine has also praised Mag Nation with being one of the 20 coolest companies in Australia and there are now over 200 different online blog entries about the store.
Merchant’s hunger hasn’t been quelled by the success of his first venture.
“At present we are reinvesting our turnover into our infrastructure capabilities. For example, we are currently investing in a thumbprint log in system. You may ask yourself, ‘why a thumb print log in system for one store?’ The answer to that is we plan to open a store at Chadstone before the end of the year and our long term aim is to create a national presence so it pays to get these systems in place now.”
Long term, Merchant is forecasting his business will grow to 50 stores.
In the meantime, Sahil Merchant maintains his focus on Mag Nation’s expansion into Chadstone and creating what he describes as a ‘third place’ in the lives of people who visit Melbourne’s CBD where they can relax and disconnect from the everyday pressures of their working and home lives. As the business continues to add to Melbourne’s vibrant CBD and cements its position as a destination store, magazine addicts across the nation can look forward to the same in the not too distant future.
