April 30, 2008

Can A Catalog Brand Survive As An E-Commerce Pure-Play?

The April survey question was "Can A Catalog Brand Survive As An E-Commerce Pure-Play, One That Does Not Mail Catalogs?" Here's how you responded to the survey question:

Can a catalog brand survive as an e-commerce
pureplay, one that does not mail catalogs?


Yes, Customers Will Just Shop Online 44%
Yes, But Sales Will Plummet 35%
No, The Cataloger Will Soon Be Out Of Business 21%

The reasonably even distribution of answers is congruent with the data I see across various Multichannel Forensics projects. Some companies would be out of business within a few months. Some companies would see a dramatic decrease in sales. And some companies would thrive.

Yes, Customers Will Just Shop Online:
  • Brand has a retail channel that is dominant.
  • Online channel is more than fifty percent of direct-to-consumer sales.
  • Online channel has a broader merchandise assortment than the catalog has.
  • Customer never enters catalog key-code when ordering online.
  • Brand is not "over-mailing" customers.
  • Brand is in "Retention Mode".
  • Catalog is in "Transfer Mode".
  • Customer is largely urban or suburban, age 18-45.
  • E-Mail and Paid Search performance improves in mail/holdout tests.
Yes, But Sales Will Plummet:
  • Brand does not have a retail channel, or has a small retail channel.
  • Online channel is less than fifty percent of direct-to-consumer sales.
  • Online channel has the same merchandise assortment as the catalog.
  • Customer sometimes enters catalog key-code when shopping online.
  • Brand is in "Hybrid Mode".
  • Catalog is in "Equilibrium Mode".
  • Customer is largely suburban, age 35-55.
No, The Cataloger Will Soon Be Out Of Business:
  • Brand does not have a retail channel.
  • Online channel is less than thirty percent of direct-to-consumer sales.
  • Customer always enters catalog key-code when shopping online.
  • Brand is in "Acquisition Mode".
  • Catalog is in "Isolation Mode".
  • Customer is largely rural, age 50-80.
In my experience, these general guidelines hold up pretty well. We could get away from a catalog marketing program at Nordstrom because our customers largely fell into the first classification --- middle-aged, urban/suburban customers offered a better merchandise assortment online and in stores. But if you are a cataloger of fine cheeses with an older/rural customer base, you'd be out of business without your catalog.