A Halloween Catalog Horror Story (I’d Turn Back if I Were You)
Last week, I blogged about getting the most out of your printer. This week, I’ll talk about some things you should never do when producing your catalog and managing your expenses.
The way to ensure your return on investment in the catalog business is to pay close attention to your catalog expenses, namely, printing, mailing, postage, design, prepress (these days called “premedia”), lists and service bureau. Coupled with cost of goods and operating expenses, they are the fundamental numbers you need to work up in order to define your break-even point for a particular mailing.
Carefully handling that break-even point by tightly managing catalog expenses is the key to profitability. Here’s a rule of thumb for you: Every penny you add to your catalog unit cost, means that you’ll need to generate roughly 2 cents more for every book you mail.
Now for the scary story: Last month, a catalog company I did some work for officially closed its doors. Some good people lost their jobs that day, because management ignored some simple rules of the catalog business. Others who saw the handwriting on the wall, left before the axe fell. The company could have been saved. Management had a small but powerful niche to work in, and if it had followed the principles of “cataloging 101,” it might have turned the business around.
Instead, those running the company threw every bell and whistle possible into their catalog creative. They built a catalog that looked more like a coffee table book with ridiculously heavy paper that weighed in at around 8 oz. What’s more, they turned the catalog on its side, and used metallic inks and varnishes. Even worse, when they mailed the catalog, the thing came apart, it was so heavy—and it wouldn’t remain flat. People were receiving only the catalog cover.