Circulation Theory: Part 7

The organic percentage is influenced by between-catalog cannibalization.

More important, the organic percentage is influenced by your online and mobile channels.

When you execute your mail / holdout tests (you execute these, right?), you learn four things.

1. Most of the demand captured at your call center is generated by catalogs - without the catalogs, you don't generate the demand. Usually 20% +/- of call center demand is organic - and 80% is caused by catalog mailings.
2. E-commerce demand (excluding email marketing) is about 50% organic and 50% caused by catalog marketing. This is the mystery of our time ... few people actually measure this and fewer people understand what it means when half of online demand happens without catalogs. This means freedom ... it means your business has a path forward, and you can save a ton of ad cost and reinvested it elsewhere (or pocket it and make your CFO happy).
3. Mobile demand is often 80% organic and 20% catalog driven. As the customer gets younger and/or the customer is two channels removed from catalog marketing, the customer exhibits different behaviors, behaviors that are not influenced by catalogs. Again, this means freedom ... it means your business has a path forward, and you can save a ton of ad cost and reinvest it elsewhere (or pocket it and make your CFO happy).
4. Email Marketing demand is often 95% organic and 5% catalog driven. Why does your catalog matter when you send the customer a daily email marketing message? Get rid of your catalogs (via tests) and watch carefully how the customer shifts to email marketing. It doesn't happen overnight. But six months later or nine months later, the shift is clear. Again, this means freedom ... it means your business has a path forward, and you can save a ton of ad cost and reinvest it elsewhere (or pocket it and make your CFO happy).

I spent more than a decade communicating these facts to you. The facts represent an important part of circulation theory. Much of what I'm sharing with you was learned not in catalog marketing, but in sorghum tests I analyzed at the Garst Seed Company ... in 1989. The same concepts applied to the ways that sorghum hybrids grew, and were measured via reasonably simple tests - the same kinds of tests that you measure today.

I've shared these facts with you for more than a decade, for free. I've given you a path to the future. How many of you have taken advantage of free advice?

Tomorrow I'll show you why the organic percentage is so darn important, ok?