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"Thank you, Jim. You don't hear this often enough, but I feel you should know that we would not be the company we are today if not for you. And, as we move toward becoming the ‘world class' company I envision, you'll continue to play a very important part in that process. It never ceases to amaze me how you can put on 'the hat' that's necessary when it comes to solving the challenges that face us."

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(This page presents current news and views about catalog and ecommerce marketing. The following article on catalog startups appeared in The Chicago Tribune, Monday, June 13, 2005)

Niche retailers find catalogs can bring in new audiences

Printed sales books expected to generate billions in revenue

By Ann Meyer
Special to the Tribune

June 13, 2005

Just days after Jayson Home & Garden's first catalog arrived in Lincoln Park mailboxes last month, the retailer saw an uptick in foot traffic, including visits from some who had never been inside the Clybourn Avenue store before.

And that's exactly what owner Jay Goltz had in mind when he conceived the glossy print catalog. "It's working as we expected, hoped and planned," he said. "People are coming in with the catalog in their hands."

So much for the paperless society.

While some retail experts once predicted the growth of the Internet would lead to the demise of the print catalog, few are suggesting that today.

In fact, just the opposite has occurred, experts say. Sales from print catalogs are expected to hit $152 billion this year, up from $143 billion in 2004, said Amy Blankenship, director of the Direct Marketing Association's Shop-at-Home Information Center in New York.

What's more, retailers and online merchants that previously had little interest in print catalogs increasingly are developing them, as new research shows catalogs are great sales drivers, experts say.

"Multichannel retailing is the state of the industry right now," Blankenship said, noting that 80 percent of Americans now shop from home at least some of the time. "Consumers want to shop when they want to and where they want to," she said.

In fact, Goltz said he created the new book after many of his retail customers asked for one. While Jayson Home & Garden's recently revamped Web site also displays selected merchandise, Goltz decided an artistic 24-page catalog heavy on photography would garner more attention.

The fact that catalogs are delivered to consumers' homes provides an advantage over the Internet, experts say.

"The Web site is a passive channel. The mail order catalog is an assertive channel. You decide you're going to call on someone," said Jim Padgitt, president of Direct Marketing Insights Inc., a catalog marketing consulting firm in Charleston, S.C.

Plus, catalogs have staying power. Nearly six out of 10 catalog shoppers keep a catalog that they order from for at least three months, Blankenship said.

But the catalog business has many caveats, Padgitt said.

"Many people get excited about the marketing prospects of a catalog and don't pay enough attention to pulling it off," he said.

Because of hefty printing, paper and mailing fees, a mistake in merchandise, presentation or target market can be costly, Padgitt said.

Goltz spent about $70,000 on his catalog, sending copies to about 50,000 existing customers and local prospects who subscribe to upscale shelter magazines, he said. While Goltz said he has no dreams of turning his $10 million business, which also includes Artists' Frame Service and Chicago Art Source stores, into a mail-order company, he is hoping to drive sales with the catalog. But, he acknowledged, "It's an expensive endeavor."

What's more, many retailers aren't prepared to process catalog orders, Padgitt said. "You have the additional burden of having to accommodate the orders, packing the orders for shipment and paying the shipping," he said. If you can't deliver the goods, your customers won't be happy, he said.

To be successful, Padgitt said, avoid common mistakes, which include:

- Selling commodity merchandise. Trying to compete with mass merchants will backfire, because catalogers generally can't win on price alone, Padgitt said.

- Creating a confusing brand image. A retailer's catalog should convey the same brand image as its store. Don't emphasize low prices if you're an upscale merchant known for service.

- Mailing too many catalogs. While on a per-piece basis, catalogs often cost less to print and mail as the volume goes up, sending out too many catalogs can overwhelm a retailer who isn't equipped to handle the demand, Padgitt said.

- Being caught short on merchandise. Failure to provide merchandise advertised is a sure way to make enemies, Padgitt said. Goltz acknowledged he could easily run out of a hot catalog item, but he purposely omitted an order form in his catalog to downplay at-home ordering. Instead, he hopes most people come into the store to shop, where options abound.

- Presenting too little information. Every catalog needs to strike a balance between engaging images and necessary content, Padgitt said.

- Overlooking the cover's importance. The cover should instantly communicate what the catalog is all about, Padgitt said.

- Making it hard to order. Customers don't want to hunt for the merchant's phone number or Web address, Padgitt said. They also want to know shipping and handling prices and return policies.

- Expecting immediate success. It often takes two to three years to build a sufficient base of 8,000 to 10,000 repeat customers to generate profits, Padgitt said.

To boost your odds of success, Padgitt advised, "Tread very slowly in the beginning. Don't jump out with a major mailing until you've learned to do business on a small scale."

Goltz's artsy approach breaks some conventional rules, but the catalog is getting noticed, he said.

"It's an adventure," he said. "We can be viewed as geniuses or idiots, depending on who's looking at it."

Copyright (c) 2005, Chicago Tribune

 
   

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"I could not afford to add management to my staff, so I looked around for someone that I could use as a sounding board, and who wasn't afraid to offer sound direct marketing guidance. I quickly learned that Jim Padgitt was the missing link for our company. Thanks to Jim's sound business recommendations, we have enjoyed a dramatic financial turnaround. Even though we are hundreds of miles apart, Jim has become an important part of our business. He is my Vice President of Direct Marketing."

Chuck Ehlers, President, GS Direct,
Bloomington, MN

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