Significant Catalog Marketing Events Over the Past 60 Years
By: Steve Lett
Several significant events over the past 60 years fueled the growth of mail order catalogs. These events have very much shaped the industry. While it seems like yesterday, I can remember every one of these key occurrences. I thought it would be interesting, especially for newer Direct Marketers to know which events have influenced catalog marketing the most.
Specialty catalogs began to emerge in the early 1970’s. There were several catalogs prior to that time such as Montgomery Ward, Sears, L.L. Bean, Vermont Country Store, Walter Drake, Taylor Gifts and others. However, the real growth of specialty catalogs like The Horchow Collection (1971), Victoria’s Secret (1977), Coldwater Creek (1984), Chadwick’s of Boston (1983), etc., expanded rapidly in the 70s and 80s. There was no internet back then, postage costs were reasonably low, response rates were good, and conditions were favorable to start a mail order catalog right on your kitchen table (like Country Curtains, Brookstone, Talbots and others did). Much of the growth of specialty catalogs was made possible by the following key events in order of their occurrence.
- The Zip Code – By far, the introduction of the Zip Code in 1963 revolutionized how we mail. The term ZIP stands for Zone Improvement Plan and it was chosen to suggest that mail travels more efficiently and quickly when mailers use the code as part of the postal address. The extended Zip+4 was later introduced in 1983 in order to reference an even more specific location. The Zip Code made it possible to sort catalogs based on where they were going and to gain mailing efficiencies through the USPS. The use of the Zip Code changed everything.
- Inkjet Addressing – In the late 1970’s inkjet printers made it possible to address catalogs using a computer. This was the beginning of the end for paper labels known as Cheshire labels named after the Cheshire machine they ran on. They were 4-across and pin feed. Catalogers relied on the customer to peel off the label and place it on the order form before they submitted their order. Many did; several customers did not. Printed on the label, in addition to the customer’s name and address, was the source or key code for order tracking purposes. Inkjet imaging the customer’s name, address and source code directly on the back of the catalog eliminated the need to use a label. What’s more, this technology became sophisticated and printers were able to inkjet the same information on the front of the order form that was bound into the catalog. (Back then, all catalogs included a bind-in order form.) The percentage of orders traced to a specific source code increased and there was no need for match-backs that we rely on today.
- Co-Mail – Before off-line co-mail in 2008 came co-binding on stitchers in early 2000. This was limited to the largest mailers. Later, the co-mail process leveled the playing field for mid-size and small catalogers. This made it possible for them to have the same postage rate advantage as the larger mailers.
- Postage Rate Increase in 2007 – Just when mailers were doing well, they were dealt a big blow; postage rates increased 24%. It was devastating and unexpected. This one event eliminated many of the smaller catalogs which went out of business. They simply could not absorb this rate increase. The catalogs that did survive were forced to make dramatic changes to paper and format/size of their catalog. What’s more, mailers expected the printers to help them absorb the rate increase. This was an extremely difficult period for catalog companies and suppliers.
- Cooperative Databases – The use of a cooperative database for prospecting purposes was introduced in 1990 by Tony White who started Abacus. It was brilliant. But who would have ever thought, back then, that a catalog company would turn over their house file to Abacus. This took a great deal of convincing. Some mailers did not agree to participate. It started as a “blind” database and remains so today. This means that they do not publish or reveal the mailers who participate in their coop. Only product categories are discussed, i.e., food, apparel, etc. Today, more than 80% of all prospect names are selected from one of the five or six different cooperative database companies. The use of cooperative databases has greatly reduced the number of vertical lists that are rented causing many list brokers to go out of business. Many of the policies developed by Tony almost 30 years ago are still in place today which is pretty amazing.
- Drop Shipping – In 1991 the post office created “Drop Shipping” which provided an incentive to mailers to have their catalogs trucked to the BMC’s and SCF’s in exchange for significant postage discounts. This is a service that is provided by catalog printers.
- The Internet – Then came the internet in the late 1990s and early 2000s. The impact of the Internet needs little explanation. Based on our experience 60% to 80% of all orders today are coming through (not from) the Internet. The catalog is the biggest driver of traffic to the Internet which has become the preferred way to place an order.
I know there are other factors that could be mentioned. From my perspective, these are the most significant events of the past 60 years. My entire career has been devoted to catalog marketing. When I reflect on all the innovative developments in this business, I am truly amazed.
In the world of multichannel marketing and being able to target and measure results, I feel that print catalogs are here to stay. It is all about maximizing the customer experience through the integration of mail, email marketing, social media, etc. Let’s face it, print catalogs build the brand. The sky is the limit for the next 60 years. It will be an experience to witness what is yet to come from this exciting industry.
Stephen R. Lett is the Founder and Chairman of Lett Direct, Inc., and a catalog consulting firm specializing in circulation planning, forecasting, digital marketing and analysis since 1995. Mr. Lett spent the first 25 years of his career with leading catalog companies; both business-to-business and consumer. He is the author of a book, Strategic Catalog Marketing. He can be reached at 302-539-7257 or by e-mail at firstname.lastname@example.org.