Time For Questions
With just three weeks to go before our catalog seminar in Concord, NH on catalog metrics, I’m happy to announce that we have over 200 registrations, and the conference hotel is sold-out (but there are other hotels nearby). I keep getting notes and emails from attendees expressing how much they are looking forward to Kevin Hillstrom’s business simulation.
But before Kevin presents his simulation, I’ll be presenting my annual update on the present status of the catalog industry and my take on catalog metrics. Each year, I start out by asking for a show of hands to reveal how many of the companies in attendance grew the prior year by more than 10%, then 5%, then 1%.
Last year there were only a few that had grown by more than 5%. There is growth out there, among certain retailers. People are still buying stuff. So why is there such little growth among most catalogs?
Let’s forget about the co-ops for a minute and whether they are good or bad, dying or growing. Let’s just focus on one thing – there is not much prospecting for new customers going on at most catalog companies. Why?
Before I answer that, let me share with you a brief story. In the early 1990s while working as the catalog marketing and circulation guy at Brookstone, the company hired a new CEO who had no catalog experience. The company was in rough shape, but the drain on our financial success was not the catalog, it was the 200+ stores. The new CEO turned his attention on the stores because that was the biggest part (80%) of the company, and because the catalog was making plan.
Then one day, my boss, the VP of Marketing hurt his back and was out for two weeks. During those two weeks, every time someone had a question about the “financials” on the catalog, they came to me. One day the CEO called me into his office to ask why list rental income was down.
This was the income we derived from renting our list to other mailers. In the company I had worked at before Brookstone, we did not actively promote the rental of our file. We exchanged a great deal, but had limited rentals. Upper management at that company had “strategic reasons” for this. So, when I got to Brookstone, I continued this “laissez faire” approach to list rental income.
At Brookstone, it was very unusual for the CEO to be quizzing a manager on a specific line item. However, because this CEO had no mail order experience, I thought he would appreciate an explanation from me on my “strategy” towards list rental income, and the fact that I had no control over list rental income, as it depended on other companies using our list, which was dependent on their circulation plans.
Big mistake. HUGE mistake.
For a guy that knew nothing about catalogs and mail order, he started to ask some pretty probing questions. That’s why he was CEO. He knew that Millard Group, located right across the street from Brookstone in Peterborough, NH, was our list manager. “Put some pressure on those guys over at Millard to proactively sell our list. Do some promotions. Get the word out in the industry that you are ready to deal. Change the price. Do whatever you have to do, but get that income up. YOU control and YOU are responsible for this line item – don’t blame it on other mailers.”
To that CEO’s credit – whose name was Hank Kaminstein – he never raised his voice at me, never uttered a swear word, never spoke to me in a sarcastic or demeaning way. Instead, he taught me the value of taking action.
That is what we are going to focus on in three weeks at the seminar – taking action. You wanted to learn about which catalog and ecommerce metrics you need to know and use to grow your business. You wanted to know how merchandise analysis could help you grow. But in reality, you need to see that metrics really don’t help you if you are unwilling to change, and unwilling to take action.
To answer my original question – there is so little prospecting for new customers because you won’t take action and you don’t want to change the way you acquire customers. Carpet bombing with prospect catalogs with names sourced from the co-ops is not working to the degree it used to, but you are reluctant to try other options. Hopefully by the time you leave our seminar, you will have the ammunition you need to impart that sense of urgency for change at your company.
There are four parts to our seminar – my presentation, Kevin’s business simulation, Frank Oliver’s presentation on merchandise analysis (which he has been hinting will include something on “merchandise warfare”), and our closing Q&A session, which in years past could have lasted twice and long, and we still would not have gotten to all the questions.
So, if you are registered to attend, start thinking about your questions for Kevin, Frank and me. If you send them to me before the seminar, they will get priority at that session. I’ve already had a few submitted, which I will share:
One for Frank – My boss keeps telling me that our merchandise needs to be a “curated collection”. What did catalog merchants do before they became the equivalent of a museum curator?
One for Kevin – A while back, you asked in your blog if it was better to have 100 potential customers that were “engaged” with the brand, but who had not ordered, or one customer that had placed an order. What is the answer for my company?
If you have not already registered for the seminar, click here to visit the VT/NH Marketing Group’s website.
Registration costs for this all day event:
- $135 for VT/NH Marketing Group members
- $200 for non-members
- Registrations are accepted until March 28, 2017
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by Bill LaPierre
VP – Business Intelligence and Analytics
Datamann – 800-451-4263 x235