November 24, 2024
Business

Catalogs thriving despite growing Web sales Mailings serve as key marketing tool for retailers

FREEPORT – L.L. Bean projects that its online sales will overtake catalog sales within two years, but don’t expect any trees to be spared in the process.

The company has no plans to scale back its mailings of 200 million catalogs a year. Nor do many other mail-order companies that have flooded customers’ mail boxes this holiday season.

The number of catalogs shipped to homes and businesses has held steady despite online competition, and the number of catalogs actually grew last year.

“People who were caught up in Web mania thought it would supplant the catalog,” said Madison Riley of Kurt Salmon Associates, a retail consulting firm. “That has not come true, and I don’t think it will ever come true.”

In today’s multichannel retailing world, catalogs are seen as an important marketing tool for driving shoppers to other channels. Big retailers like L.L. Bean are active in all three channels: stores, e-commerce and catalogs.

The success of catalogs is underscored by eBay’s decision to use a catalog to drum up business for its Web site.

“The companies don’t care [which channel] you buy from, as long as you buy from them,” said Amy Blankenship, spokeswoman for the Direct Marketing Association, based in New York.

It was just five or six years ago that some analysts were predicting the Internet would render catalogs obsolete.

But catalogs survived even though Internet sales have grown faster. Internet sales are projected to grow 27 percent to $52 billion this year while catalog sales will grow 6.7 percent to $143 billion, she said.

L.L. Bean once shared the view that online sales would lessen its reliance on printed catalogs.

But the company found that the two were intertwined, with catalogs giving a significant boost to Web site traffic and shoppers freely switching between the channels, said Steve Fuller, Bean’s marketing chief.

“One of the mistakes people made was in thinking of the channels as discreet, but it’s the same households. Some days they call, some days they order from the Web site, some days they drive to the store,” he said.

Lands’ End saw sales drop when it cut back on catalogs in 1999 and responded by boosting catalog mailings, according to the Print E-business Report published by the Printing Industries of America.

A Lands’ End spokesman declined to release catalog numbers. The E-Business Report put distribution at 270 million last year.

Catalogs nationally held the line for three years in which there were three postal increases before bumping upward last year to 17.5 billion. A similar number are being mailed this year, Blankenship said.

The average U.S. household receives three catalogs per week, but that’s not the way it works in reality, because retailers have become smarter about the way they use catalogs, which are expensive to produce and to mail, she said.

Retailers like Lands’ End and L.L. Bean have discovered that their catalogs provide inspiration to get shoppers to go to Web sites or visit stores – or pick up the phone, said Riley, who is based in Boston.

And if a catalog’s job is to provide inspiration instead of providing a comprehensive listing of goods, then the catalogs can be smaller, offering a cost savings to retailers, he said.

At L.L. Bean, even the best customers receive 30 to 40 percent fewer catalogs than a few years ago, and the company is saving money by sending some customers smaller catalogs, Fuller said.

The money saved is being used for prospecting for new customers, he said. L.L. Bean expects this to be a banner year for attracting new customers and projects sales of $1.3 billion.


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