Growth is one of the greatest long-term challenges for any catalog company. Whether yours is a small catalog or a behemoth, adding significant growth year after year is, to say the least, a difficult task.
Why? In general, catalogers aren’t adding significant numbers of new catalog buyers to the universe of names available for prospecting. This universe currently is comprised of more than 50 percent of U.S. households, but many of these customers have purchased only from the largest books, such as J.C. Penney, L.L. Bean and Lands’ End. This means we’re all mailing to a fairly fixed audience that’s constantly being pummeled—especially the very best customers—with more and more mailings.
With continued postage increases, any inefficiency while converting consumers into mail-order buyers has become expensive. The Internet will continue to feed some new names, but for now, most growth must come from improving results to prospects and compelling those on your housefile to spend more.
This month I’ll examine ways to add growth to both of these important groups.
Growth from Prospects
There are several ways to grow your business with your prospecting efforts: increase your prospecting quantities (i.e., expand your universe); improve response to your existing prospect lists; and get prospects to spend more.
Knowing your corporate objectives will help you choose appropriate strategies for your business. Some efforts will increase top-line growth at the expense of profits. Some strategies will increase profits at the expense of the top-line or new-buyer counts. And some will optimize both the top-line and profits.
Many of the typical efforts explored by most circulation managers produce incremental improvements, which shouldn’t be overlooked. But to move the needle in a significant way, more should be done. The following ideas can produce breakthrough results in your prospecting work.
• Create a prospect version of your catalog. If your merchandise assortment is broad and your current catalog is more than 48 pages, use your marketing database to determine which items, categories and price points are frequently purchased by your first-time buyers. If the resulting assortment is much different, or is smaller and more focused than your current assortment (and still big enough for a 24- to 32-page book), you may be able to improve results by producing a separate catalog with this edited assortment. You can give more space to the right items and really focus prospects on the items new buyers have shown the highest propensity to purchase.