Create A Successful Circulation Plan
Circulation planning is the lifeblood of a catalog. A catalog simply can’t exist without it, and a good detailed plan makes for much easier and quicker implementation.
There are two approaches to circulation planning: top-down or bottom-up. We’ll examine the difference. There also can be different goals or objectives. The most common goals are to increase sales, market share, growth and profits. It’s not unusual to have the goal be some combination, such as “increase sales 10 percent while holding profits even with last year as a percent of sales.”
In top-down planning, upper management determines what the desired change will be, compared to the previous year’s performance. If a 10-percent increase in sales is the goal, you have at least two options: You can increase each mailing’s sales by 10 percent across the board; or you can increase some mailings more than 10 percent while decreasing less productive mailings so they average out to an overall 10-percent increase.
In bottom-up planning, the person doing the actual analytical work and creating the circulation plan, usually the marketing or circulation manager, first determines what improvements in sales are possible. This requires a seasoned professional who understands both the individual catalog company’s business and the catalog business as a whole.
A combination of bottom-up and top-down planning works most effectively. To achieve this, upper management informally discusses desired objectives, then the circulation planner works toward them, but is free to determine what is achievable.
Exactly how does the planner plan? For the most part, circulation planning is based on some simple assumptions:
1. Basic measurements—percent response, average order and dollars per book—will be the same for the exact same segment in the same book in the same time frame this year as it was the pervious year. This means your 0-6 month, $100-plus buyers in this year’s Summer One book of 48 pages, mailed the beginning of the third week of May this year will perform the same as the 0-6 month $100-plus buyers in last year’s Summer One book of 48 pages, mailed the beginning of the third week in May.
Steve Lett graduated from Indiana University in 1970 and immediately began his 50-year career in Direct Marketing; mainly catalogs.
Steve spent the first 25 years of his career in executive level positions at both consumer and business-to-business companies. The next 25 years have been with Lett Direct, Inc., the company Steve founded in early 1995. Lett Direct, Inc., is a catalog and internet consulting firm specializing in circulation planning, plan execution, analysis and digital marketing (Google Premier Partner).
Steve has served on the Ethics Committee of the Direct Marketing Association (DMA) and on a number of company boards, both public and private. He served on the Board of the ACMA. He has been the subject of two Harvard Business School case studies. He is the author of a book, Strategic Catalog Marketing. Steve is a past Chairman of both the Catalog Council and Business Mail Council of the DMA. He spent a few years teaching Direct Marketing at Indiana University in Bloomington, Indiana.
You can contact Steve at email@example.com.