Merchandise, Talent, Inventory, Brand Extension, PR and More Highlight NEMOA Session

Merchandise is still king. That was only one of a handful of themes taken from a wide-ranging and spirited session at last week’s NEMOA Spring 2008 Conference in Cambridge, Mass. This particular session included Derrick Egbert, president of New Perspectives; Allen Abbott, EVP/COO of Paul Frederick MenStyle; Jonathan Fleischmann, president/ CEO of the Potpourri Group; and Dana Pappas, COO/CFO of Plow & Hearth. It focused on the pressures of managing a catalog business in today’s uncertain economic times. Below are some of the tips/observations taken from the panelists and audience members.

* Merchandise: “It’s the starting point,” Fleischmann said. The need for collaboration among all divisions of a catalog company (i.e., marketing, analytics, operations, call center and other units) is more critical today than ever. “Picking names doesn’t matter,” he added, “if you can’t fulfill the orders properly.”

Pappas listed product as the leading factor in determining a catalog business’ success. “It has to be the right product at the right time,” he said, “and preferably developed in-house.” He mentioned his company’s recent success in its children’s division over the holidays, crediting its proactive approach in spreading the message of its products safety to its customers in light of recent dangers exposed (and product recalls) in some other children’s items.

* Hiring Quality Talent: Abbott spoke of the challenges Paul Frederick faces in hiring good catalog people. Being located in the small town of Fleetwood, Pa., doesn’t lend itself it to finding top talent, he said. He cautioned the audience members not to undermine the capabilities of the people within their own organizations. “You may be under-using some of your employees,” he said, noting that a talent search should begin in-house.

Egbert added that upper management has to be willing to invest decision-making power in its employees. This will speed up their ability to make these decisions in the future, he noted.

Pappas provided some insight on how Plow & Hearth has alleviated its talent shortage by launching a training program with nearby University of Virginia to help recruit potential talent. He also pointed out that the Madison, Va.-based cataloger operates an in-house mentoring program where senior level employees spend a day working with a lower level employee.

* Extend Your Brand: Chris Bradley, CEO of Cuddledown and an audience member for this session, noted that one of his company’s efforts to drive business in these tough times is to “get your brand out there beyond catalog circulation.” For example, his company works with hotels to offer Cuddledown catalogs in hotel rooms. This helps capitalize on potential customers who enjoy such Cuddledown products as pillows and comforters during their stays at the hotels, and who want to know where they can buy the linens.

* Public Relations: As another means of extending your brand, Pappas pointed to a recent PR bonanza that recently graced Plow & Hearth. A representative of Martha Stewart’s TV show called the company and said that Martha loved one of its products and wanted to know if she could feature it on her show. Naturally, the company gladly accepted. As if the plug on the show wasn’t enough, Martha Stewart’s Web site put a link up to the Plow & Hearth site for six months. Needless to say, the product sold tremendously, Pappas said.

* Use Blogs: Panelists suggested sending a chosen blogger a predistribution (prior to it appearing in a forthcoming catalog) sample of a new product. This can help generate word-of-mouth buzz before the product hits the market.

* Demonic Discounting: Inventory management consultant George Mollo, president of GJM Associates, cautioned the audience not to be lured in by discounted pricing on a minimum purchase of products. In many cases it’s not worthwhile to buy at this bulk unless you know you’re going to move the product, he warned.

“Even at its low cost it may not be worth it to a company even for the opportunity for sale at a great margin,” Mollo said, citing the costs associated with storage and overstock.

With a parting takeaway thought for the audience, Egbert said catalogers need to manage backward from the one thing customers say they love most about their brands. In essence, focus on the aspects of the company that aren’t as highly regarded first, whether they be creative, order fulfillment, product selection or others, working back to their strengths. This creates a complete and satisfying experience for customers.