Catalog Anxiety

Are you tired of the flood of articles boasting “five tips for beating Amazon this year”? If so, I’ve got a treat for you – something that will actually make a difference.

The past few weeks have been very interesting. At a time of year when most of you are rounding third and heading toward home plate with the end of another exhausting Christmas season, readers (just like you) have been sending me many comments, questions and observations. Mostly questions concerning what to do with their business.  And I sense there is a lot of anxiety out there.

One reader lamented that he just could not figure out how to comply with Kevin Hillstrom’s advice to load up on new buyers in September and October, and get them to make second purchases in November and December (his peak season), because his prospects just don’t purchase his kind of products prior to the peak season.

One reader complained that on Cyber Monday, he received five emails from Plow & Hearth (even calling it insane), but then acknowledged that his company had sent out three emails. Do you really think the consumer is drawing a distinction between companies that send 3 vs 5 emails?

Another reader sought advice on how to handle vendors that would not allow the mailer to sell their products on 3rd party marketplaces like Amazon, but those same vendors were all too happy to have the mailer advertise for them in their catalog, and theoretically drive traffic to Amazon anyway, where that vendor is selling under their own banner.

Another reader, who knows my dislike of the co-ops, shared that he had received mailings from at least five different catalogers using old decoy names of his (five+ years of no purchases, if ever).  He commented “I no longer track where they were initially seeded because I stopped seeing them mailed to years ago, but now I’m alarmed every time one shows up in my mail.”

One reader responded to my posting last week on the importance of new products over fancy ad/branding campaigns with this comment: “I received an email barrage of Black Friday deals, extended deadlines and truly desperate marketing attempts on Cyber Monday.  Your blog hit the nail on the head!  Mailers/ecommerce sites must have unique products, or die. Customers are not stupid, so merchants need to work harder or lose sales.”

To recap those calls and emails:

  • You find it tough to acquire new customers outside of your peak season;
  • You think it is insane that one mailer sent five emails in one day, but you sent three yourself;
  • Your product suppliers are selling their products on Amazon, but don’t allow you to do the same;
  • You have suspected for a while that the co-ops were dying, but now you have proof that they are padding their models with ancient names;
  • You realize that you have to have unique products to survive.

Of all these issues, I see the need for unique products to be the most important. Nothing – I repeat – nothing else can keep the wolves away. If you have unique products (that have quality, and meet your customer’s needs), then it will be almost impossible for anyone to knock you out. When the co-ops finally roll over and disappear, if you have unique products, new customers will still find you (albeit, maybe not with a catalog).

That brings me to the last letter from a reader, which came in last week. I share it with you because it raises an issue lost in today’s online environment, which is that not only do you have to have unique products, but you have to know how to position them, market them and sell them:

“We are looking for someone who can help us with product marketing – specifically, giving a selection of our products a clear identity/brand/name. We sell a lot of innovative and solution centric homewares but, and especially where we buy direct in Asia, we often don’t strengthen the products by marketing them well. We sell them well off the page with good copy and imagery that although maybe could be improved, does the job well.”

The reader then went onto give an example from a competitor’s catalog (which I’m not going to share to protect the innocent), that this reader felt did a great job of positioning the product with a strong product name (a name that enhanced its sale-ability), great benefits, and basically created a total “reason for buying the product from them”. He realized that the vendor supplying the product may have contributed to some of that positioning, but felt that the competitor’s catalog itself had discovered and developed a constant ability to position sometimes mundane products in such a way as to compel the customer to buy one.

Going back to last week’s posting (click here), I don’t believe that fancy ad and branding campaigns alone are enough to drive sales and acquire customers. You have to have the unique products to back that advertising up. However, even unique products still need to be sold.

Whose responsibility is this? Most people would think it is the responsibility of the copywriter and the creative team. I disagree. To me, it is the responsibility of the buyer, the merchant that said “this product is so good, it belongs in the catalog”.

That applies to high-end women’s apparel, or low-end home furnishings. Here’s why – the laws of buying have changed. The giant “marketplaces” (Amazon, Wayfair, Wal-Mart, eBay) carry everything, or at least, everything that is not unique to someone like you. As one reader said, “Customers are not stupid, so merchants need to work harder or lose sales.” That means that not only must you have the unique products, but you need to have the story in mind as to why your “little black dress” is the best one on the market.

It is tough – nay, sometimes impossible – to find or develop truly new, “break-through” products. Stop and think – when was the last time your catalog had a truly great “break-through” product, one that rocked the sales chart? In apparel, most of you just play around with new color palettes. In hard goods (like house wares), you slap your name on the product and think “Everyone is going to want one of these now because it has our logo, and is unique to us”.  But that is not breakthrough, nor is it unique – and you know it.

However, making incremental changes to existing products – making them better and different – can be as productive as that once-a-decade breakthrough product. Have a great Christmas stocking to hang by the chimney? Why not add solar powered LED lights that twinkle when the lights are out, so Santa can find it. (OK, so I just found this already exists on Amazon – but you get the idea. You need to innovate, and then sell the innovation).

To stand out, and compete against Amazon – yes, they are probably your biggest competitor no matter what you sell – you still have to sell. If you sell home furnishings, stop showing your products in neutral/sterile home settings that look like North Dakota in March, and which has no appeal at all. If you sell housewares, develop a name for the product beyond what the vendor calls it. It’s not a “comfortable pillow”, it’s “Sleeping Beauty’s Eternal Sleep” pillow. In B2B, it’s not a cart for the surgery room, it’s the “surgeon recommended, most versatile OR cart”.

I have mentioned many times in this blog that I have been driving for more than 40 years, and I’m on my sixth Ford F150. I hate to admit this, but in 1995, I was compelled to buy a new truck simply by an ad I saw in a magazine which featured a new F150 in a shade of green that I had to have. (I’m usually much more practical when it comes to deciding when to replace the current truck). When was the last time that you were so compelled by the imagery you saw in a catalog or on a website, that you bought something which you did not need at the time – that the story behind the product was so strong as to compel you to action? I’m going to bet it does not happen all that often – and that is what we have lost.

Here is the good news – you can compete against everyone out there, including the giant marketplaces. Going back to “old fashioned” direct marketing, that tells a story, sets a tone, creates a compelling argument/ reason / desire for making a purchase is all part of competing. If what you are doing now in terms of how you position product is not working, you must do something different.  Give it a try in 2018.

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by Bill LaPierre

VP – Business Intelligence and Analytics

Datamann – 800-451-4263 x235

blapierre@datamann.com

 

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Hey Massimo, Welcome to The Outdoors

Bear with me today – I’m going to explain how a famous Italian designer has a lesson for all of us on Cyber Monday.

I’m going to let the media outlets report on Black Friday/Cyber Monday results. I know they will pound home the fact that billions of people shopped online with their phones and that mall traffic was down.   What did you expect? This is a trend that has been in place for several years, and only grows annually. It is never going to reverse.

How were your sales over the past 10 days? Perhaps the better question is – how were your profits over the past 10 days? Did you discount to such a degree that there is no margin left?

Here is a more important question if your results were not where you wanted them. What caused the softness in your sales? It wasn’t floods in Texas, hurricanes in Florida, fires in California, or warm weather along the east coast. It certainly wasn’t the economy, since the stock market continues to hover around record highs. It wasn’t postal delays, or too many catalogs in your co-mail pool. It wasn’t the fact that you only gave free shipping with a $50 purchase, when maybe you should have lowered it to $40. It wasn’t that you only sent five emails on Thanksgiving, when you sent six last year. No, it was none of those factors.

If your sales are soft, and you are missing plan, there is only one reason – your customers don’t like your merchandise, or they can find the same stuff elsewhere at a location where they would rather shop.

In every speech I give, I always include this one slide:

60% of the success of any catalog mailing is related to the merchandise; 20% to circulation; 10% to creative, and 10% to customer service.

This is not a new maxim. Having the right merchandise for your customers has always been the driving factor behind sales, and ultimately, a successful catalog/website and now mobile site. But, if you count the hours that your collective staff spent on this year’s holiday catalog, you will always find that the majority of hours/time was not spent on merchandise development, procurement, or analysis. And that is why your sales are soft – you are not spending enough time developing and finding new products that are unique to you.

Which brings me to Massimo Vignelli.  If you have never heard of him, he was a famous designer, known for developing the signage in the New York City subway system, and the consistent design for brochures and maps at all US national parks, monuments and historical sites administered by the National Parks Service.

When I was the catalog marketing guy at Brookstone in the early 1990s, we had a Vice President of Marketing that was only with us for 9 months. This guy knew everyone in NYC advertising circles, including Massimo, who he hired to design Brookstone a new corporate image.

Massimo did what he was hired to do, and gave Brookstone a new logo, new corporate colors, and overall new look for our retail stores. The VP of Marketing held a meeting for all corporate staff to present the new “look”, which included new store signage, uniforms for the store staff (actually, just an apron), new boxes/packaging for all products, and even new gift wrap paper for pre-wrapped products. The VP wore one of the aprons during the meeting as he showed off all the new designs. And, he explained that this “timeless” design would last for the next 50 years at Brookstone.

But here was the problem – no one had asked him to hire Massimo Vignelli. And Massimo had sought no input from anyone at Brookstone. So, his final “concept” was to have a utilitarian brown background with red type (it was actually Pantone Warm Red). The reaction among the headquarters staff during that meeting was priceless. You could see everyone separately mouthing the words “This is ugly”.  Our CFO got up and walked out.

Over the next few months, we spent a small fortune having all our vendors switch their packaging and all of the inserts inside the packaging to match the new design. We changed all our stationary, business cards, and shopping bags in the stores. Then we discovered that a single piece of tan and red stationary is one thing, but a whole store with craft paper signage with dull red type looks like absolute …..

You get the point. The whole campaign was gone within two years, not because it looked bad, but because it did nothing to improve sales. In an item driven business like Brookstone, constant evolution of products was more important than having a consistent corporate image.

I was reminded of Massimo and Pantone Warm Red this week when I received a sweater which I had ordered from LL Bean. It has been hard to miss LL Bean’s “Be an Outsider” (get it – Bean = Be an) ad campaign this fall. The plastic shipping bag with my sweater even had the “Be an Outsider” message printed on it.

Accolades to Bean’s ad agency for carrying the “outsider” message everywhere. It was on TV, in the catalog, on the internet, and yes, outbound packaging. Plus, it was a cute theme.

But regardless of how well executed it was, I doubt it will do anything to move the needle for LL Bean. In a competitive sales environment, product innovation and exclusivity are what moves the needle, not constantly reinforcing a branding image. Oh, I know that every ad agency and creative director will disagree with that opinion. But the proof will be whether you still see the “Be an outsider” messaging in two years.

I returned the sweater that I got. It was similar to one I already had, but the “new” version was advertised as having a flannel lining (as I get older, I get cold easily). I returned it because the flannel lining was paper thin. That’s not product innovation, but product dissatisfaction.  It is clear that the 60%, 20%, 10% and 10% rule was ignored this year at LL Bean. However, I only have one credit card in my wallet, a Visa card from LL Bean, and I have faith that they will get it right and focus where it matters in the future.

Going back to my first sentence – the lesson of Massimo at Brookstone and Be An Outsider is that corporate ad campaigns give the person responsible for it a warm feeling, but no one else notices. Focus on improving your merchandise instead.

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by Bill LaPierre

VP – Business Intelligence and Analytics

Datamann – 800-451-4263 x235

blapierre@datamann.com

 

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Holiday 2017 Catalog Observations

Since most of you are prepping for big sales this week, I’ll keep today’s posting short.

Response:

I’m still hearing mixed signals for response so far in November. Some of you are doing well, some of you are soft. Most of you told me that you have a lot riding on what happens in the next 14 days. In some cases, your entire year’s success hinges on your sales over the next two weeks.

Here is one thing I noticed – Lands’ End has been pushing (via emails) 50% off selected product categories, and LL Bean had a 25% off everything offer last weekend. That tells me some mailers are sitting on a ton of inventory.

Catching Up:

Years ago, I tried to draw conclusions based on the number of catalogs I was getting at home in a certain month or a certain week, compared to the prior year. But, I’m on so many seed lists, decoy lists, and customer lists, I realized how fruitless it was to make those comparisons because I can never accurately determine why I was mailed a catalog. And of course, one lone catalog shopper in rural NH is not indicative of the rest of the industry. So, I stopped trying to do year over year comparisons.

However, since the beginning of November, I’ve received over 200 unique catalogs at home. Based on a quick count, more than 70% have had some type of free shipping offer – either full free shipping, or with a minimum $ amount purchase. Five years ago, that would have been 5% to 10% of the catalogs received. Five years ago, we were already in the Amazon-era of cataloging, yet it has taken until now for most of you to acknowledge that you have to change your marketing to remain competitive. Now you are simply playing catch-up.

Someone Has Been Busy Selling:

One other thing that has stood out among all the catalogs I’m getting this season – they are loaded with blow-in inserts.  Years ago, getting catalogers to accept blow-ins was a hard-sell because they felt they detracted from their brand, or they just couldn’t be bothered. Apparently, the resistance to accepting those inserts has been outweighed by the lure of incremental income. I see no harm in accepting these inserts for most of you, and the extra income can be used to fuel your own customer acquisition efforts.

They’re Back!

Two years ago, I wrote about the death of the Chef’s Catalog (click here).  But guess what was in my mail box this week? A quick check on-line revealed that the remnants of the company and customer list were acquired by some venture capital folks in Napa Valley a year ago, with the intent of having just a lively website.

Oh, but the lure of launching a catalog must have been too great. I read that one of the reasons they bought the company was access to the “11 million past Chefs customers who will be the initial targets of the Chefscatalog.com launch. People enjoy purchasing from Chefs Catalog. They value the assortment that enables them to cook at home, set the table and entertain.”

Let’s hope these investors, none of whom appear to have any catalog experience, did not really believe that their 11 million old customers (which must have gone back to start of the company in 1979) were all viable. But I doubt it. I also suspect that no one was whispering in their ear “Do you really think it’s a good idea to launch a catalog of homewares that are available in every other kitchen/cooking catalog and on 1,000s of websites? Especially a title that crashed and burned just two years ago?”

Granted, I do believe that the prior owners of the Chef’s Catalog (Target) squandered the opportunity to grow the catalog by linking it to products in Target stores. But, these new owners are coming into a crowded field, with a product category that is already saturated. If the spread below is any indication of their “merchandising” ability, they don’t stand a chance. All of these products are available at either Wal-Mart, Bed, Bath and Beyond or certainly Amazon.

Here’s another thought: why stop here? Maybe this could be a new trend – resurrecting dead catalog brands. Why not bring back Home Trends, Right Start, Deerskin, and Spiegel? If there really is a “resurgence of catalogs” (as I read in one blog recently from a catalog-centered vendor), then bringing back old, dead titles should be a great opportunity. Maybe there’s a whole new generation of skiers wanting to buy sweaters from the Carroll Reed catalog.

Have a happy Thanksgiving.

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by Bill LaPierre

VP – Business Intelligence and Analytics

Datamann – 800-451-4263 x235

blapierre@datamann.com

 

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New Catalogs In The Year 2025 – Part 3

What about new catalogs – will there be any in the year 2025? This is part 3 of my thoughts on the future of the mail order industry, and where catalogs will be in seven years.  Click here for Part 1 and Part 2.

Let me go back to the original question submitted by a reader that prompted me to write this series of posts. This was his closing comment: “I imagine your vision might be pretty on target and might help some folks avoid investments in a future that just isn’t likely to be there.”

Will there be a future for catalogs? The short answer is that catalogs will never completely go away in the same way that blacksmiths/farriers have not completely gone away – people who own horses still need to have them shod. But there are a lot fewer horses today than there were 100 years ago.

The long answer to that question is that catalogs in the future will never have the same value to consumers or to companies that they do today. Therefore, is it wise to invest in a future that isn’t likely to be there?

Again, let me start with a historical analogy.

In the late 1990s, a catalog got started near Portland, ME called Lighthouse Depot. Everything it sold had a lighthouse motif – gifts, apparel, home furnishings, and small replica lighthouses from around the country. I worked with the owner for several years as worked to make his business grow.

The most significant and steady part of his business were the small replica lighthouses. The catalog worked with several manufactures that were introducing new models of current and historic lighthouses. There were collectors that snapped these up as they were issued – customers actually had standing orders to receive each new lighthouse replica when it was released. It was like buying dog food on a continuity plan. What catalog wouldn’t want that type of recurring order?

I commented to the owner one day that I felt the “lighthouse” craze was a fad, just like scrapbooking. He assured me it was not, as he believed there was a deep love affair among the general population with anything lighthouse themed. At the peak of their growth, they had 104,000 12-month buyers.

Then along came eBay. Suddenly, all of those replica collectors realized that their collection of “collectible” lighthouses, which they had expected to sell and retire on the proceeds, were not even worth the original purchase price. No one wanted them. Sales at Lighthouse Depot plummeted, not just on the replicas, but everything. The company eventually went out of business and no longer exists.

Yes, you can argue that the “lighthouse craze” was just a fad that was short-lived. But, who knows, maybe the “yoga craze” will turn out to be the same. Or the “mountain biking craze”. Or the “urban logger” craze (which I don’t get at all).

My point is that many catalogs got started because they rode a wave of interest that crested quickly and died. This has not happened in consumer catalogs alone – look at Staples as an example of a B2B catalog that was ubiquitous in every office. If you wanted to order an office product, you went to a central office (maybe Accounting), looked it up in the catalog, and had someone order it. Now you just go online and look it up and send someone a link for what you want.

Aside from the aforementioned “wave of interest”, why else do people still start catalogs, especially today? There are several reasons:

  1. The obvious reason is that catalogs still appeal to a segment of the population that are motivated by a print catalog. I’m one of them. My 17-year-old son would never look at a catalog, even though I’ve explained to him that catalogs pay the bills in our house. Yet, my generation is going to get smaller as my son’s generation become the dominant shoppers in 2025. So, starting a catalog just to appeal to few old geezers like me that like to thumb through a print catalog instead of using my phone doesn’t seem like a good bet.

 

  1. Almost all of the new catalogs today started as a website, and maxed out their potential to acquire new customers using PPC and SEO. A catalog seems like a logical extension of their “brand”, and hence, a good way to acquire new customers. It’s easy to get a few hundred thousand names from the co-ops, and do an initial mailing. The initial mailing results are awful, compared to what new catalogs experienced 20 years ago, but these new mailers don’t know that. They look at the 0.7% response rate and think “Man. That’s pretty bad.” But their co-op rep says “Now that we have actual responders, we’ll tweak the model”. And they do, and response rate goes up a little more. With luck, maybe one of their new lists performs above break-even. The mailer creates an analysis to show that these new buyers are being acquired for slightly less than their most expensive PPC words, so they keep plugging away with a catalog for a few more years. In my opinion, they will soon hit the same wall that most existing catalogs have hit, which is that the faucet of viable prospect names from the co-ops has peaked, and then dried up.

 

  1. There will always be a desire to start catalogs by new “Patagonia wanna-bes”. No one today or in the future will invest money to start a new Lillian Vernon, National Wholesale, or Plow & Hearth – catalog companies that have generated tons of relatively low average order transactions. Amazon, Wal-Mart, and Jet will have those marketplaces covered. Instead, the new catalogs in 2025, like the new catalogs in 2017, will all be about “lifestyle”. Entrepreneurs that haven’t fully thought out the logistics of starting a catalog will be driving these new ventures. They will not know to ask how and if it can be sustained, or where are the new customers going to come from? But they will want to share their vision and their dream with the world, which they cannot do with a mere website. It can only be done with a 48-page catalog, selling products on only half the pages. And they will quickly learn, as so many other catalogers before them have learned, that selling “lifestyle” is not so easy, and that selling “merchandise people actually want” is hard.

Every new catalog faces one daunting task. It is not being profitable, it’s not finding new customers, it’s not having unique merchandise (although that is daunting) and it’s not having great margins.

The most daunting task that every new catalog faces is being able to SELL THE DREAM.  Not the entrepreneur’s dream, or the consultant’s dream or the creative agency’s dream, but the CUSTOMER’s dream. What does the customer want and can it be delivered in a way that can be sustained, and is relevant to the customer?

Somewhere right now, there is another “Jeff Bezos” type entrepreneur who is setting his/her eyes and mind on every market – including whatever market you are in. They are ignoring the established way of doing business, and planning a new way that will leave the existing players in the dust, because they are appealing to the CUSTOMER’s DREAM. If it has not already happened with your market/product category, it will. Your customers are consumers and consumer behavior has changed from what it was 20 years ago. Today, your website and your mobile site HAVE TO BE better than your catalog – that is where people go first when seeking product information. Whether you have a great looking catalog in the future will be of little importance to the customer. They just want the products they need, and they want to order them in a way that is convenient to them. Much to your chagrin and amazement, these consumers have ways of “discovering products” without catalogs. And the next “Jeff Bezos” – whoever that person is – will wipe the slate clean with a new online approach to meeting the needs of your customers, and it is doubtful that it will include a catalog.

We are at an enormous disadvantage trying to look at the future 8 years out, because most of us are looking at the future through our “catalog mindset”. We are trying to envision what catalogs will be like in the future, when we should be thinking about how consumers will be buying then. That is why I asked Amy Africa to be one of our speakers at our seminar in April 2018. If you can survive the next two years, Amy is going to tell you how you need to be communicating with your customers in the future. And according to Amy, you haven’t seen anything yet!

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by Bill LaPierre

VP – Business Intelligence and Analytics

Datamann – 800-451-4263 x235

blapierre@datamann.com

 

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In The Year 2025 – Part 2

Who will be the catalogs that survive to 2025? This is part 2 of my thoughts on the future of the mail order industry, and where catalogs will be in seven years.  Click here for Part 1.

Let’s start with another historical reference. In the 1990s, there was a catalog of women’s apparel and home furnishings called Faith Mountain, located in Virginia. Every one of their women’s dress jumpers was labeled “exclusive”.  But there was nothing exclusive or unique about them. They were just another navy-blue jumper. However, the folks at Faith Mountain believed their jumpers were exclusive because they had 5 buttons instead of four, or two pockets instead of one.

The catalog hit a peak $20 million in sales in 1999, but was reportedly never profitable, and eventually closed down in 2002. I always thought the owners were simply kidding themselves thinking that their products were unique and exclusive, and apparently, so did their customers.

So, who among the catalogs still mailing today will survive? For part of my answer to this question, I’m going to turn to the wisdom of Kevin Hillstrom, who has pointed out that the large players and the small guys (not just in catalogs, but in most industries) tend to be the ones with the greatest likelihood to survive. The catalogs in the “middle” will struggle and many will disappear.

In my opinion, that means the big players like LL Bean, Cabela’s/Bass Pro, Lands’ End, Williams-Sonoma, will likely survive into 2025, and beyond.  Not because they have products that are unique or that you can’t find on Amazon, but these bigger titles still have iconic brands which will resonate with consumers (assuming they don’t wander off to the wilderness) for years to come. They still have clout with the consumer. Catalogs will still play a role in their sales in 2025, though most likely in a diminished role from what it is today.

I do not include the big catalog conglomerates (Orchard Brands, Cornerstone, Amerimark) in this “big catalog” category. They may have many synergies, they may have big internal databases, but with the exception of a few individual titles like Garnet Hill and Frontgate, there are no “superstar” consumer titles among them that have the brand clout to stand out. They are mostly a collection of tired look-alike titles, that just happen to be part of a big company.

I see smaller catalogers (under $5 million in sales) surviving as well, assuming they have something truly unique to sell. Dakin Farm is an example I have written about before. They are a small catalog located here in Vermont (where Datamann is located) selling Vermont smoked meats, Vermont cheese and maple syrup. They have two stores, which are destinations for tourists. Once those tourists go home with their purchases, Dakin Farm uses their catalog to drive additional sales. Amazon may be able to beat Dakin Farm on price, but they won’t be able to create the Vermont “flavor” that sets the catalog apart. If you have never been to Vermont, the catalog probably would do nothing for you. But if you had been here, it will remind you of the good times you enjoyed on your vacation.

That’s what other small catalogs will do as well. They will stay small and keep it all. Their margins are good, and they have a small set of reliable vendors on whom they can rely to “get stuff done” without the cost of additional employees.

Both the very large and very small companies will contend with the Amazons of the world, but they will not compete with them head-to-head. Amazon will be there, but the big guys have value in their name and brand (i.e.: their products) which brings them authority. You can buy a pair of boots from Amazon, but they are not the iconic LL Bean boots. LL Bean, which continues to have a hard time keeping those boots in-stock, is doing fine selling those boots through its own channels at the moment, which includes taking their Bootmobile to college campuses.

The small guys will have unique products which Amazon simply is not going to be able to sell, because they are proprietary to that catalog, or just too small a niche even for the almighty Amazon to pursue.

There are two big issues for “middle-size” catalogs in the future: first, how will you find and develop unique product, which Amazon can’t copy, and two, what will be the source of new customers – where will they come from? The big guys have house files of millions of names, retails stores that generate buyers, and can afford to advertise. The little guys have always been in a niche market, and already had to discover numerous ways of finding the buyers in that market, and for the most part, did not rely upon the co-ops.

Oh, the catalogs in the middle: not big enough to have the critical mass of customers or the name recognition of the big guys, nor having a product mix that is truly unique. How do they grow if Amazon is choking off the supply of names to the catalog co-op databases, as well as competing with them directly with product?

I don’t want to single out any specific titles by saying “If I were working at Catalog ABC, I’d be really nervous because you’re in Amazon’s cross-hairs”. So, let’s see if any of these are true for you:

  • More than 10% of your products are found in at least two other company’s catalogs. If that’s the case, they are on Amazon too, and you are not unique.
  • You have no truly proprietary products.
  • Your definition of “unique” is similar to that of Faith Mountain, that you have a brown wool cardigan sweater with five buttons, and the manufacturer sells everyone else four buttons. Yes, your version is “unique to you”, but does the customer care?
  • You have products labeled ‘As seen on TV’.
  • You rely on the co-ops for more than 90% of the prospect names to which you mail the catalog.
  • You acquire less than 40% of your new customers from on-line activities (PPC, SEO, Facebook ads).

Unless those middle size catalog mailers start the hard work of developing alternate sources of new customers and some truly unique merchandise, they will not survive.

I’m not a baseball fan, but I read an interesting story in the WSJ last week on how the Houston Astros and LA Dodgers, the two teams in this week’s World Series, exemplify a trend in baseball. Both teams went through a period known as “tanking”, a method of team rebuilding that involves enduring a stretch of consecutive seasons with horrible results in order to acquire the pieces (mostly through top draft picks given to the worst teams) in order to make their way to the top of the standings. The owners of these teams would rather suffer several years of total ineptitude in order to shoot to the top than suffer the mediocrity of always being stuck in the middle of the standings. (If this principle applies to football, then the Cleveland Browns should be poised to win back-to-back Super Bowls soon).

This is what you have to do with your catalog. You have to be willing to suffer some years when sales and response will not be great in order to develop unique products and sources of customers that do not rely on the co-ops. And in my opinion, the unique product is the most crucial of the two.

I just finished writing the copy for the brochure announcing our catalog seminar in April 2018. (Yes, it’s ironic that I’m writing about the demise of catalogs but I still rely on print – a brochure – to drive attendance to our seminar). The overriding theme for our seminar in April is that you must do something different, and that survival in the coming years for most of you is going to be extremely hard work. But, you must begin now.

I’m going to wrap this series up next week with a look at new catalogs today and in the year 2025.

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by Bill LaPierre

VP – Business Intelligence and Analytics

Datamann – 800-451-4263 x235

blapierre@datamann.com

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The Sears Wish Book Redux

I’ve been waiting for this to happen.

A friend of mine called me on Wednesday to tell me that he just heard that Sears was relaunching its iconic Christmas Wish Book. See full story here.

By the time you read this, all of the online trade newsletters and catalog industry  blogs will be screaming “We told you so – print is not dead! Sears is bringing back their catalog!”

Well, good luck to them. Sears has been hemorrhaging cash for years, and seen their stock value plummet. Every week they announce more store closings. I see this as the last act of a desperate company.

Don’t get your expectations up too much. Sears said only its “best members” will receive a print copy in the mail, and some other customers in its Shop Your Way membership program will receive an email allowing them to pick up a copy at a Sears store. Everyone else will get to “see” the catalog online and you already know how well online catalogs work – zilch.

What looks like great news for the catalog industry could be simply a PR ploy for Sears, since a very limited number of these catalogs will be distributed.

Here is something else to think about: Sears stopped doing catalogs years ago. Who was left to design this book that knew how to drive response? Plus, when was the last time Sears did catalog fulfillment? With limited distribution of the catalog, maybe this is not a problem, but who is left to process the orders? Will they be fulfilled from stores that are already short staffed?

As I said at the beginning, I’ve been waiting for this to happen, although I did not expect it would be Sears. I thought Victoria’s Secret or maybe FAO Schwarz (which is opening a kiosk in Bergdorf Goodman in New York this holiday season) would be the ones that would announce a limited-edition catalog which the industry would point to as an example of “the return of the catalog”.

My point – Sears’ announcement today means little to the catalog industry. But watch how this story gets played over the next few weeks.

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by Bill LaPierre

VP – Business Intelligence and Analytics

Datamann – 800-451-4263 x235

blapierre@datamann.com

 

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