A CEO’s Guide To Modern Catalog Circulation, Part 2 of 3

In the second installment of my three-part series on the evolving role of catalog circulation in today’s multichannel environment, I’ll continue my discussion on the types of audiences catalogers must segment by examining online-only customers and lapsed customers (those who haven’t purchased in more than a year). These two audiences comprise my second concept of audiences. Last week, I identified those customers who always order via the phone/mail channel and those who’ve purchased both online and via the phone/mail during the past 12 months.

Here are tips on how to contact these very audiences in 2008 and beyond. (For part 1, see A CEO’s Guide to Modern Catalog Circulation, Part 1 of 3.)

1. The online-only audience is a tough nut to crack. Some order because catalogs were mailed to them. But plenty of others order from online advertising, natural and paid search, e-mail marketing, shopping-comparison marketing, affiliate marketing or blogs, and/or any combination thereof. If a catalog keycode is attached to orders, the segment is likely to perform similar to the multichannel segment. If no catalog keycode is present, this audience may not seem responsive to catalogs at all. Yet, if you mail this type of customer repeatedly, you’ll find that a matchback analysis will always say the catalog is responsible for the order. The difference between mail and holdout test groups determine what’s really happening.

2. Lapsed customers. This audience hasn’t purchased in more than a year. Mail and holdout groups help one decide the appropriate strategy for marketing to this group.

The performance of each audience is likely to be very different, and what motivates each audience to purchase is very different. The phone/mail customer may be an older or rural customer. The online customer may be younger and suburban. These differences in demographics require different marketing strategies, even different catalog merchandising and contact strategies.