Strategy: Circulation Planning

I highly recommend doing matchbacks. If you’re not yet doing them, and you’re relying solely on what you can report on by key, mail your Web buyers. To a great degree, the catalog drives Web sales. I’ve seen Web buyer segments perform four to six times what they report on by key (after matchback). Web buyers tend to use the Internet to order and therefore, are less likely to use a source code. So, when using prematched results, if your performance cutoff is $1 per catalog for housefile and you have a Web segment that’s doing $.80 per book, you should mail it. That segment likely is doing at least $3 per catalog mailed.

Sources of Sales

There are more sources of sales today, another change that is affecting circ planning. While the catalog remains the largest driver of traffic to the Web, orders and sales now are coming from a variety of other places. Web-based affiliate programs, shopping sites like Amazon.com, FineGifts.com and YahooShopping.com, generate orders and sales aside from the catalog. Circ plans must take into consideration the origin of the buyer.

There are catalog buyers, a variety of Internet buyers, multichannel buyers, nonbuyers, etc. Knowing which groups to mail and how often makes circ planning more complex. Typically, 10 percent to 15 percent or more of orders or sales aren’t generated by the print catalog. Many of those shoppers are one-time buyers. Some continue to make purchases only from the Web site and aren’t influenced by the catalog. Mailing these buyers simply increases your direct selling expenses and the ratio that’s critical to profitability. The Internet shift is making it more difficult to plan.

Cooperative Databases

Co-op databases enhance circ planning and results, and have changed everything. They’ve enabled catalogers to prospect more cost-effectively. The results are better (for at least the top segments) and the cost per thousand prospect names is lower compared to other outside lists (unless, of course, the list is on exchange). Most mailers think co-ops provide names for prospecting purposes (up to 60 percent or more of all prospect names are selected from a co-op database), which of course, they do.