Timeline for a New Catalog Launch

By Steve Lett

Timeline for a New Catalog LaunchInternet only retailers and other direct marketers recognize the importance of having a catalog in their marketing toolbox. Catalogs are a targeted media that can generate new customers with a strong life-time-value. They also recognize that catalogs are the biggest driver of traffic to the web.

I want to discuss the various steps that need to be taken in order to launch a new catalog and the resulting timeline. Generally, the first catalog will take longer to produce than subsequent catalogs. Extra time is needed to develop the plan, settle on the creative and to merchandise the book properly.

To get started, we need to develop a Project Description. The purpose is to outline the approach, recommendations and support needed for the development of a print catalog program. Let’s take a look at what’s needed in the Development, i.e., Phase I.

Project Scope – Development Phase I

First, we need to develop a print catalog marketing plan, determine the cost associated with entering the market, resources required (internal and external), order/revenue forecast, schedule and method of analysis.  This is where we need to determine how we will leverage the existing house file (assuming there is one) and how we are going to effectively prospect for new buyers in order to accomplish the stated goals. This is a go- or no-go turnkey plan. It will include all of the information and steps needed to successfully develop and launch a print catalog. This work requires approximately 60 to 90 days, although it can be accomplished in less time depending on the scope of the project. A comprehensive circulation plan and revenue forecast needs to be developed which includes the following:

  • In-home Dates
  • Circulation Plan/Strategy by Drop (mailing) and Total Print Quantities
  • House File Segmentation by R-F-M (Recency, Frequency and Monetary Value)
  • Order Curve for Every Mailing
  • Order and Revenue Forecast by Mailing
  • Weekly Order/Revenue Forecast
  • Incremental Breakeven Point Analysis Down to the Contribution Level
  • Prospect Universe Plan
  • Direct Selling Expense Budget
  • Cash Flow Forecast
  • Promotional Offers Defined (if any)
  • Three Year Top-Line Revenue Forecast to the Contribution Level
  • Determine Page Count and SKU Count

It is important to understand how the success of the catalog program will be determined. The main criteria I like to use is Revenue Per Catalog compared against an incremental breakeven point (as determined in the Development Phase I above). Let’s take a look at the Success Factors that need to be considered:

  • Revenue per Catalog Mailed (RPC) vs. Incremental Breakeven
  • Response Rate Percentage; House File and Prospects
  • Average Order Size (Dollars)
  • Actual Direct Selling Expenses vs. Budget
  • Actual Order/Revenue results vs. Forecast
  • Merchandising Square Inch Analysis

Implementation – Phase II

This is when we begin to implement the plan defined in Phase I. We order the prospect lists to be used, segment the house file and begin the merge/purge process. If the company starting a catalog has only been selling online, they have a house file that can be leveraged and modeled for prospecting purposes assuming there is a minimum of 5,000 names. It there are more than 5,000 names available that’s even better. We assign a source code to every segment of the house file and to all of the prospect lists we are testing. When all of this work is completed, the computer service bureau we are using for processing will supply mail tapes to the printer for inkjet formatting and addressing. Shown below is a typical schedule for a startup catalog.

Typical Schedule for a Startup Catalog

Catalog Creative

It is important to use an experienced catalog design firm or freelance artist to lay out and to design your catalog. You don’t want to use an advertising agency unless they have specific experience with catalog layout and design. More time will be needed initially to determine and to develop a look that is consistent with the image of your brand. We suggest using an outside vendor who has this specific expertise.

Catalog Printer

We always obtain printing, paper and mail distribution quotes from three qualified catalog printers. It is important that you use a “catalog printer” to print your work; a firm that has the ability to co-mail your catalog with other catalogs, helping to reduce postage costs. There are many printers who can do a good job putting ink on paper but that doesn’t make them a catalog printer. Having the ability to distribute catalogs into the USPS is just as critical.

In Summary

Allow 12-to-13 weeks to plan and mail a catalog for the first time. The second time around, this timeline will be reduced to 7-to-9 weeks depending on the extent of the merchandise changes and creative revisions. This timeline can vary due to the number of SKU’s and page count. This is meant to be a guide as you plan to enter the print catalog market.