This week we ran through a series of simulations that demonstrated something very interesting.
- If you are a struggling catalog brand and 75%ish of your sales are catalog driven, you've got problems. Cutting back on circulation hurts top-line volume and doesn't generate enough incremental profit to effectively boost the bottom line. Yes, you can save a lot of ad cost that can be invested elsewhere, but that doesn't solve your merchandising problems.
The story is different if you've done the hard work of attracting a "more modern" housefile.
- If you are a struggling catalog brand and 50%ish of your sales are catalog driven, you can cut back (dramatically) while significantly boosting profit. Your ad-cost savings (which will be significant) can be spent elsewhere, or pocketed, your choice.
The fraction of audience that works in the catalog industry would probably want to know what a five year circulation simulation says about the future of their business, correct? Contact me (email@example.com / 206-853-8278) and we'll talk about data requirements, ok??