The Future of Catalogs in an Internet World: Marginalization or Collaboration?

Unsurprisingly, catalogs are still immensely popular today, as the older, habitual generation is often far more comfortable with paper than the internet. But in a world of e-mail, e-commerce, and e-catalogues, will direct-mail catalogues continue to play a significant role? After all, in ten years, why would any internet savvy consumer browse a paper catalog?

Yet retailers are still pursuing the development of print catalogs. 78% of retailers surveyed by Direct Magazine listed catalogue sales growth as a business priority, compared with 73% listing online sales growth.[1] And these are not just retailers targeting older generations - retailers such as Victoria Secret[2] and Spiegel Shoppers continue to develop their catalogs businesses. In fact, catalogs thrive in markets as diverse as apparel to home décor to books.

To understand why retailers continue to believe in the long-term value of catalogs, we must look at the role that catalogs play in the RVP of retailers as opposed to the online channel.

Catalog shopping adds to the shopping experience[3] because it is a more tactile activity. Consumers of all ages, often nervous about buying items online for fear that they will not be as they appear, are somewhat reassured by being able to flip through pages, mark them up, and talk to a order representative on the phone. Furthermore, catalog shopping is a fairly passive activity as compared to going online. A catalog sits on the coffee table and reminds the consumer to purchase / order, whereas the internet requires the consumer to remember the store on their own and actively seek out products.

Catalogs also enhance consumer perception of selection.[4] E-catalogs have the ability to showcase a wide range of SKUs cost-effectively, but print has the advantage in aesthetics. Print images simply look brighter, glossier and bolder than those on a computer screen and enhance the perception of the product. Print catalogs can also reach consumers more easily than e-catalogs due to spam filters.

Given these advantages, it seems that retailers will be forfeiting significant consumer value by abandoning catalogs. But how do retailers use catalogs so that the online and print efforts are not duplicated, but rather complement one another?

Since print has the benefit of being aesthetically-pleasing and acting as a "purchase" reminder, it makes sense for today's catalogs to focus on brand-building and setting the general image and tone of the brand for that season. Catalogs must move towards streamlined “magazine-like” formats with storylines, themes and moods[5] and “hybrid” sale catalogs.[6] The new, less bulky catalog simply “hooks” the customer on to the feel of the brand’s selection, and then refers them to the website (which is increasingly accessible and cost-effective) for a full range of SKUs and other product details.[7]

Through this technique, perceived selection is maximized because consumers are exposed to the full aesthetics of the product as well as access to a wide range of SKUs. Convenience and experience are similarly maximized, as consumers are exposed to multiple means to view and order the product.

As such, it is certainly possible for retailers to have the best of both worlds!

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[1] Schultz, Ray. For Catalogers, Print Rules. Jul 1, 2005. www.directmag.com

[2] Victoria’s Secret. www.victoriasecret.com

[3] Murray, K. Retail Value Proposition. Richard Ivey School of Business

[4] Murray, K. Retail Value Proposition. Richard Ivey School of Business

[5] Lee, Louise. Catalogs, Catalogs, Everywhere. Business Week. New York: Dec 4, 2006. , Iss. 4012; pg. 32

[6] Hybrid Sales Catalog: Promoted as a "sale event" on the cover, but the catalog combines offerings of sale prices on seasonal categories with full pages of regular priced, higher-margin basic merchandise.

Barry, Curt. Clear It Out. Multichannel Merchant. Stamford: Feb 2008. Vol. 25, Iss. 2; pg. 1

[7] A popular example of this is make-up retailer Sephora – www.sephora.com

Other Links:

The U.S. Market for Catalog Shopping. Packaged Facts. March 1997. www.marketresearch.com