September 2007 Issue
A Farmer’s Catalog Metamorphosis
BACKGROUND: Rob Johnston Jr. founded the Johnny’s Selected Seeds catalog on a farm in New Hampshire when he was 22. He spent most of his life on farms, and is now in his 34th year running the business as its chairman. BIGGEST INITIAL CHALLENGE: Unfamiliarity with the catalog business. “The biggest challenge was the day-to-day operations of running a business,” Johnston says. “The creativity or the energy to do the work was never an issue. Not having run a business beforehand was the biggest factor.” HOW HE OVERCAME THAT CHALLENGE: “I gradually grew the product line itself, which allowed me to hire people to run the
A Talk with September’s Profile, Rob Johnston Jr., Founder and Chairman of Johnny’s Selected Seeds
Profile of Success, Catalog Success magazine, September 2007 Interview by Joe Keenan Catalog Success: When was the catalog established? Rob Johnston Jr.: The catalog was started in 1973. I was the original founder at the age of 22 when I started the catalog on a farm in New Hampshire. CS: What is your primary merchandise? Johnston Jr.: Seeds. From vegetables, flowers, herbs and farm seeds for covering crops. Vegetable seeds make up 70 percent of our business. CS: What was your biggest initial challenge? Johnston Jr.: The biggest challenge was the day-to-day operations of running a business. The creativity or the energy to do
All You Need to Know About E-mail Authentication
A recent Direct Marketing Association (DMA) survey on multichannel marketing in the catalog industry shows that all catalogers use both their catalogs and Web sites to generate sales. Nearly nine out of 10 also use e-mails to reach customers. E-mail provides them with an easy method for order confirmation, shipping notices and customer service follow-up. But are you sure your e-mails are making it into customers’ inboxes? Is your brand protected from criminals who send fake e-mails in your name and use your company’s good reputation to defraud consumers? Strides Made, But Problems Persist While enormous strides have been made in recent years to combat the
Blogging 101 for Catalogers
Is your company blogging yet? With the soaring cost of postage and pay-per-click advertising, blogging offers catalogers a powerful channel to get their message to prospects and customers worldwide. The cost is low. The impact is high. Here are 11 steps to get you started. 1. READ LOTS OF BLOGS. Before you start your own blog, spend at least two weeks voraciously reading. Choose an RSS reader; I recommend Google Reader. Get familiar with blog search engines, such as Technorati. Find bloggers writing about niches related to your company, products, industry, customers, etc. Add bloggers you like to your RSS reader. Follow
Cost-cutting Tips You Can Take to the Bank
Much has been said and written about the stunning postage increase that took effect earlier this year. With new rates running upwards of 40 percent-plus greater than the previous ones for some Standard mail (catalog) categories, this may be the toughest challenge I’ve seen this industry encounter in all my years covering the business. Fortunately for all of us, we have sharp minds like our lead columnist Stephen R. Lett and his vice president at Lett Direct, Sandy Wolstencroft. Steve and Sandy took it upon themselves to break down virtually all the ways you can implement change in your catalog mailing strategy to
Creative Cut: Nautical Cataloger Doesn’t Sail Deep Enough Into the Water
Bluewater Books & Charts is a 104-page consumer catalog that offers navigational charts, instruments and gifts to the nautical community. In addition to the catalog, the company operates two retail stores and, of course, a Web site. I suspect this catalog markets to high-income shoppers willing to spend a great deal of money on their hobby-based lifestyle, and Bluewater needs to capitalize on this with a design that’ll make sailing enthusiasts want to part with their dollars. But the Bluewater catalog is as predictable as a nautical chart in its careful organization. Let’s look at some specific problems as well as some creative solutions that
CS0907_IndustryEye
NEMOA at 60: ‘Small’ Event Yields Big Ideas This month’s NEMOA conference in Portland, Maine, Sept. 19-21, marks the 60th anniversary for what started — and remains — a small specialized trade group. For many long-time members, NEMOA is all about conferences. The group holds semiannual conferences each March and September designed for catalog/multichannel marketers. “The main value of NEMOA is being able to get together and network,” says 20-year member Dan Walter, president and founder of Eagle America, a woodworking tools and accessories catalog. “You learn tricks of the trade from the people you meet, whether it be from a high-powered speaker
How You Can Help Avert Another Rate Hike Disaster
Just about all catalog merchants in America should have gotten more than their fill of news, comments and opinions on the meaning, impact and consequences of the 2006-2007 postal rate case. If you have no idea what I’m referring to, perhaps you’d be better off finding a new career. By now, you should’ve learned how to adjust your business marketing practices to accommodate the recent round of horrendous catalog postage increases. If you haven’t, then you’re about to learn some difficult, unforgiving lessons in trying to make a living in a hotly competitive marketplace. Your focus now must be on the future. Not the future
Limited by Medicare Laws, AOS Finds Alternative Means for Prospecting
The AOS home products catalog is in a tough position when it comes to prospecting for new customers. Why? Half of its business comes from Medicare recipients, and the federal government has strict parameters on how and when it can procure lists. “It makes it difficult to drum up new business,” explains Lisa Juenger, former operations manager for AOS catalog. “Medicare has very stringent guidelines, and we have to follow them to the nth degree.” The Earth City, Mo.-based AOS is a direct-to-patient catalog for ordering home care medical products including ostomy, nutritional supplements, incontinence and diabetic supplies. The current catalog runs 120 pages and will
More Than Skin Deep
Back in the fall of 2005, Larry Gaynor enlisted the Gallup Organization to work with his company. The founder and president of B-to-B salon supplies cataloger The Nailco Group (TNG) had read about the firm’s extensive business consultancy, most notably The Gallup Path, a method that connects employee performance with a company’s bottom line. With annual sales of $85 million and a talent pool of 315 (at TNG, you’re not an “employee,” you’re “talent”), TNG is considerably smaller than most of the companies Gallup works with. Gaynor, however, believed that Gallup’s guidance on employee and customer engagement would benefit his team and, ultimately, the
New/Old Boomer Challenge
Remember those old TV announcements, “It’s 10 p.m., do you know where your children are?” Those have come to mind lately as my son Marc, 17, enters his senior year in high school. He, my wife and I have hit the ground running searching for colleges. Like any parent, to me it seems like he grew up practically overnight. But it’s the college search thing that’s really hit home with me lately — namely, that a generation has passed. This column isn’t about him; it’s actually about my generation. See, my thought process seems to naturally flow from this, “Wow, you’re growing up; you’re
Proper Positioning
Few catalog/multichannel merchants include inserts in their prospecting or retention media plans, a fact that continues to baffle those who use inserts profitably. Most catalogers use bounceback catalogs as a kind of retention insert (though most don’t think of them as inserts). Few consider the strategic value of inserts to their retention rates, not to mention prospecting media mix. But there are countless other strategic benefits of including inserts in your prospecting. The assorted retention plans that can help you achieve overall business goals are worth looking into. Consider the strategic value of inserts for prospecting and retention separately. Strategic Prospecting Benefits 1. Inserts are an
Spend to Grow
Rule of thumb: A catalog company can’t break even on the initial orders generated from prospects. Catalogers must be willing to invest to acquire new buyers to grow, or at least maintain, their 12-month buyer count. This month, I’ll cover the cost to acquire a new buyer, why it’s important to invest in prospecting and why you shouldn’t expect to break even on the initial order. Catalogers tell me they don’t want to prospect below the incremental break-even point. That’s a nice goal, but it’s not realistic. Today’s economics, such as postage costs, paper prices, etc., combined with lower response (an ongoing trend
The Double-edged Sword of Inserts’ Implied Endorsement
Inserts in packages or statements benefit from an implied endorsement of the sponsoring marketer whose package or statement the insert is riding along with. This can be a boon or a curse. In most cases, package inserts create a positive boost with the implied endorsement. Customers are receiving merchandise they ordered; they’re happy to receive what they’ve ordered and will look more favorably upon the inserts in the package because of it. This includes those bounceback catalogs many catalogers insert in outgoing shipments. But beware if customers aren’t happy with the merchandise in that package. Then, that implied endorsement becomes a “curse.” “When customers
The More Things Change …
“I don’t think the catalog business has really changed that much over the years,” contends The Nailco Group Founder and President Larry Gaynor. “The processes involved in producing a catalog haven’t really changed much.” But he has little doubt that the business climate definitely has changed, with the Internet altering how B-to-B customers make purchases, and how catalogers communicate with their suppliers. So how does his company approach the old-fashioned world of cataloging in modern times? “The cataloger really has to figure out, early on, its core competency,” Gaynor declares. Define your niche, model your database frugally. “It’s easy to hook up with a list broker,
Ways to Manage Your In-House Database
1. KEEP all channel and primary source data that lets you segment deeper than recency, frequency, monetary. RFM segmentation is no longer enough when mailing your housefile. 2. CAPTURE the original source for Web buyers whenever possible because you’ll want to segment by it. Price-comparison, shopping-engine buyers may respond differently than affiliate buyers, paid and organic natural search buyers, or Web buyers driven by your catalog. 3. DIVIDE your buyers by purchase channel. Segment traditional telemarketing buyers, Web buyers who purchased after receiving a catalog and Web buyers who’ve never received a catalog. Tag each order by purchase channel so you can identify
You’ve Got Homework!
While your mailing list is the most important asset in your catalog business, your in-house database is the key to optimizing your mailing list. Relational databases are powerful marketing tools that allow catalogers many opportunities for understanding their customers and learning how to mail smarter. How do you use your database to its full potential? Dave Kuncicky, chief executive officer of equine catalog Chamisa Ridge, uses his company’s database to segment its customer base into product categories and to “find interesting things about customers. If you have several nonintersecting groups of customers based on what they buy,” he says, “you find two classes of customers
