Catalogs, Catalogs, Everywhere
For Smith & Hawken, the future lies in cyberspace. Sales of flower pots and gardening gadgets on the company's Web site are blossoming, accounting for 20% of total sales of $170 million in 2005. Meanwhile, catalog sales are wilting, declining to 15% of total sales last year, from 19% the year before.
So why not just ditch the paper catalog?
Not a chance, says Felix Carbullido, senior vice-president for marketing at the Novato (Calif.) outdoor-accessories seller. Rather than becoming obsolete in the online age, he says, the old-fashioned catalog is the most effective way to make an emotional appeal to the consumer. And ultimately, he argues, the catalog is the best method to convince customers to go online. "It's not just about commerce from the catalog," says Carbullido, who helped redesign Smith & Hawken's catalog earlier this year.
Thanks to e-commerce, as well as rising printing and mailing costs, catalogs were supposed to be dead by now. But a quick visit to the mailbox will confirm that predictions of their death have been vastly exaggerated. Catalogs are, in fact, more popular than ever—and thriving because of the limitations of shopping by pointing and clicking. Unlike the bulky books of yore, such as the venerable Sears catalog, which at times ran to 1,000 pages, the new breed of catalog is a glossy, magazine-like statement meant to convey to consumers the look and feel of a brand. That's a task the typical home PC just isn't up to, no matter how good the resolution of the monitor. The prototypical new catalogs don't attempt to list everything in the product line. Rather, they simply show a carefully selected and dramatically photographed selection. "We're promoting an entire lifestyle in the garden or patio, not just items," says Carbullido.
Sure, consumers may complain about the stacks of catalogs stuffing their mailboxes. But they're using them anyway, and their actions are speaking louder than their words to retailers. That's why the rate at which companies are sending out catalogs is on the rise. In 2005 the number mailed grew by 5.5%, to 19.2 billion, compared with a 5.3% growth rate the prior year and 3.8% in 2003, according to the trade group Direct Marketing Assn.
Cataloging the Numbers
A big mass-mailer like Victoria's Secret ships 400 million of them annually, or 1.33 for every American citizen. What can Victoria's Secret possibly get out of those 400 million catalogs? Plenty. Last year its catalog and online orders accounted for nearly 28% of its overall revenues of $4.4 billion. Those sales grew by 10%, more than double the 4% increase from its stores. Catalogs have become so important to the retailer that it even lists the cost of mailing, paper, and printing as a "risk factor" in its financial statements because an increase in those expenses could hurt earnings. That's not the only potential trouble: The lingerie company has drawn fire in recent years from forest conservation groups.
Even companies that started life on the Web appreciate the allure of a well-designed catalog. Zappos.com, the online shoe giant, in the last few weeks started including its Zappos Life catalog with orders. At tiny candy company JohnandKiras.com, co-owner John Doyle started a catalog in October after operating for more than four years only on the Web. The e-commerce site itself is an efficient way to place an order, but "it's not a good way to attract attention, especially with new customers," says Doyle. Marketing through electronic mail, while cheap, often gets caught in spam filters, he says.
Now that catalogs have a new mission as brand-building devices, companies are making fundamental changes in their design. Because catalogs are meant to give consumers ideas instead of listing every item in the product line, marketers can make them smaller. Clothier Talbots (TLB) has in recent years used small, square catalogs to promote holiday gifts and men's clothing.
But last year it extended that strategy to its core women's apparel business, starting up an early fall catalog with fewer pages than its regular 8-in.-by-11-in., 80-page women's clothing books.
Real Fabric Swatches
Meanwhile, online come-ons are sprinkled everywhere in today's catalogs. In the current L.L. Bean catalog for outdoor gear, page 3, a prominent spot in any catalog, features a blurb about a sales rep's climb up Mt. Everest. "Read about his trip and see his remarkable photographs" at the Bean Web site, it says. Indeed, almost every spread in the Williams-Sonoma (WSM) catalog tells readers to go online for information ranging from sample Thanksgiving menus to recipes for Brussels sprouts.
Even as they try to drive people to the Web, companies are also working harder to tap into a desire of consumers to have something to touch and hold. "Catalogs are a tangible connection in an intangible, online, all-in-the-ether world," says Wendy Liebmann, president of WSL Strategic Retail. For instance, the cover of L.L. Bean's clothing catalog this season features an actual fabric swatch for its Fitness Fleece Pullovers. "Feel the softness and the quality," the cover copy says.
To fire shoppers' imagination, high-end retailers from Saks Fifth Avenue (SKS) to Neiman Marcus are upping the number of over-the-top fantasy gifts they're offering. Lavish descriptions of these offerings, such as Neiman's $1.7 million rocket trip into space, are more than sales tools. They also make good reading material. "People like to receive a beautifully produced catalog. It's entertaining," says Tony Cox, a catalog consultant in Richardson, Tex.
Real Food on the Tables
Not all of the intellectual energy is going into design and storytelling. Some companies are trying a highly scientific tack to sharpen their catalogs, using complex mathematical methods allowing them to test and track many changes simultaneously to save time. In 2004, Williams-Sonoma shipped out 56 versions of its flagship Mother's Day catalog, each one just slightly different from the others. Some versions varied the number of products on the cutlery layout or included a letter from the company founder, for example. Others included an index. Then, the company took sales data from each version and analyzed which changes generated the best sales. Among the findings: While most changes didn't make much difference, four did, each by increasing sales in the catalogs by up to 7%. Among the tweaks that boosted performance: adding an index and including a tear-out recipe card.
Some companies are pursuing top-to-bottom redesigns, a task Smith & Hawken just completed. Previously, the typical layout in a Smith & Hawken catalog had as many as six items, each shown in photos of roughly equal size. Lighting was stark. Copy focused heavily on the attributes of the products themselves. In the spread showing the Hadley Peak line of wooden furniture, for instance, the main 5-in.-by-7-in. photo of the furniture is on one page and surrounded by six photos of other products. The lighting in the main photo casts hard shadows of chair legs onto a brick patio. Folded napkins and glasses on the table are unused. The spread, says company creative director Sam Osher, "was item-specific. The imagery was based just on the product."
Fast-forward a year to the new design. Using a practice known as "heroing," or blowing up an item so it overshadows everything else in the layout, Smith & Hawken now promotes the same Hadley Peak furniture using a 6-in.-by-11-in. photo spread over the layout. It's surrounded by only three other items in far smaller photos, making the furniture the clear focal point. The table is set with actual food and glasses of beer, one half-consumed to show that "there's life in there. Someone was using this napkin," says Osher.
Patio furniture that tugs at the heartstrings? That's exactly the point. "We're showcasing an environment to be aspirational, inspirational," Osher says. "We want to build a scene that makes you say: 'I want to be there.'"
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