Don’t start a catalog!
Really… I mean it!
If you’re not already in the catalog business, don’t start one. In fact, you can stop reading here.
Don’t even waste your time…
O.K., you got me. I’m being ironic.
In fact, a few paragraphs down, I’ll tell you why now is the best time to start a catalog business. But, only as long as you’re willing to follow the few simple rules of the catalog business. Rules that run counterintuitive to your current business model.
To me, this is a fitting way to start my first weekly blog (silly word blog, but less silly than saying the word “spam” 50 times a day, right?). So without further ado, let’s discuss why you should not start a catalog company, much less add one to your existing business.
Actually, before we discuss starting a catalog, let’s discuss you.
I pretty much know you already. You are absolutely killer at what you do. You’re a product driven merchant, who is either a retailer or a pure play Internet company. You’ve given birth to, and put your blood, sweat and tears into your products and company. You’ve leveraged everything you have to make your dream a reality.
And, without a doubt, you know what your customers want, right? Of course right!
Now, you feel that by adding a printed catalog, you can generate new customers, service your present ones, and increase your profits exponentially.
Well, congrats, you are right. Partially anyway. You’re thinking, how difficult is it to create and mail a catalog. I can just create the thing, and well, if I build it, they will come.
But the ruthless truth -- and this is what I tell anyone who asks me “what does it take to start a catalog?” -- is that cataloging is probably the most difficult business model there is. It’s not a business model is for the faint of heart, and I can prove it to you. Consider the following:
How do you feel about mailing a catalog that loses money?
How about one that loses money for about two to four years?
That the cost, on a P&L basis of acquiring a new customer is almost always in the red?
And depending on your margins, it could take a year or so to recoup the cost of acquiring that customer?
Oh and how about the fact that you’ll need to become a number cruncher, because trying to run a catalog business by the seat of your pants and intuition is like trying to play football with hockey skates and a stick.
Getting woozy yet? Don’t be discouraged. If you have the stomach for it, and you have patience, there are many rewards for those who take the risks of becoming catalogers. For instance:
It has been proven that customers who interact with all of your channels will likely be better customers and spend more over time with you. Companies with print catalogs see faster ROI and higher customer lifetime value.
Despite all the Internet-will-take-over-the-world doomsday scenarios out there, print catalogs are still the most reliable source for driving business and profitability.
In fact, people still love to get their catalogs. They love that tactile feel of thumbing through the pages of their favorite catalog. And they love the Christmas morning element of getting a copy of their beloved catalogs in the mail.
The truth is that catalogs are as American as Mom and apple pie.
So hang in there. Because over the next few weeks we’re going to discuss the core competencies you will need in order to start a catalog, add one to your existing business, or take your catalog to the next level. And along the way, I’ll share some strategies, and tactics that you’ll likely find helpful, along with some success stories (and a few horror tales) from my experience.
I invite your comments, criticisms, ideas, etc.
Jim Gilbert is president of Gilbert DIrect Marketing. Reach him at (561) 302-1719 or firstname.lastname@example.org