Strategy: A Primer in the Basics of Catalog Circulation

Step 2. Quantify any changes to your programs, such as page counts, density and promotional offers, in terms of a percent increase or percent decrease. Apply these changes to the percent response and average order, as each would affect that measure.

Step 3. Estimate the number of names you’ll have in each RFM segment for each mailing.

Step 4. Using your company’s expense ratios and data you’ll operate under for this plan, calculate either the RPC break-even figure or the contribution to profit and overhead that each of those segments would achieve.

Step 5. Review all forecasted data. Look for two things: segments that should be eliminated and segments you probably could mail to more deeply. Eliminate all the segments you meant to drop.

Prospecting

Prospect list continuations should comprise 60 percent of the total circulation going to prospects and 40 percent of new tests. Prospect tests should contain a good sample of out-of-category lists as well. On finding an out-of-category, workable market to prospect to, you’ll increase the ability to grow your business.

Testing “new” lists and expanding the prospecting universe are critical to any circulation plan. Here are several things to look for when testing a new list:

How actively is the mailer prospecting? When you test a list for the first time, determine the list owner’s six-month file size as a percentage of its 12-month file size. If its six-month file size is greater than half of its total 12-month buyer file, the list owner is prospecting and adding new names to its own housefile.

How well is the list maintained?
Make sure the files you use are updated and are run through the proper hygiene regularly.

What list selections are available?
Find out what selections the list owner makes available so you can drill down on specific ones.