The Best Way to Manage Catalog Circ During the Downturn

But it can be done, and here are a few ways to help you optimize ROI with catalogs as part of your integrated marketing mix:

• Your most recent response rates are the leading indicator of future response. Response rates have changed, so look to recent results and discount your historical results from last year.
• Recalibrate your circulation plan based on which housefile and prospect lists are responding above breakeven.
• Be able to calculate recent catalog results so you can analyze your recent results as quickly as possible.
• Review your promotion strategy — and your competitors’ promotion strategies — to see if you should be discounting to get sales.
• Pay attention to your competitors’ email strategies. Are they hitting your market with strong email offers? Make friends with Direct Media/Millard and get its E-mail Tracker Report. It's a great piece of competitive intelligence.
• Cut circ that's fallen below breakeven. Give up prospecting below breakeven, and focus on maximizing short-term profitability.
• Increase your contacts with your current buyers through catalog remails and/or email contacts. It's easier to get more sales from your current customers than prospecting for new buyers at a profit.
• Paper and printing costs are coming down. Review your paper prices with your printer to make certain you're getting current market prices. Printers are having a hard time filling press time because catalog mailers are cutting press runs while magazines have seen a big falloff in ad pages. The result: Printing and paper costs are coming down.

Jim Coogan is president of Catalog Marketing Economics, a Santa Fe, N.M.-based consulting firm focused on catalog circulation planning. Reach him at (505) 986-9902 or jcoogan@earthlink.net.