16 Apr How the mighty can fall: 5 things to consider before killing off your print catalogue
The once ubiquitous print catalogue is in its death throes. Accelerated by the pandemic, the demise has seen retail businesses globally either throttling back or stopping print catalogues completely.
Even the iconic Ikea catalogue has not been immune to the changing media landscape. Launched in 1950 in Sweden, the catalogue, at its peak, was said to have a greater annual circulation than the Bible. Now, globally, its future is limited to special editions with much smaller, targeted print runs.
Many retail businesses in Australia are reviewing their reliance on print catalogues. However, the strategies being applied are varied. Just take the two biggest supermarkets as an example. Coles took the pull-off-the-band-aid-quickly approach and ended print catalogues in mid 2020. Woolworths has taken a more considered approach, testing and learning with incremental changes.
So what is a business to do with their once-cherished sales catalogue?
There’s no doubt that the future of value-based offers is largely in the hands of digital technologies that deliver a curated selection of the most compelling offers to individual customers, based on behavioural data and AI machine learning. The digital promise is compelling; lower costs, efficient distribution, better customer experience, trackable performance… No more “spray and pray” distribution with the old printed catalogue. We’re talking precision marketing.
But there are risks. Get the transition to digital wrong, and you can hurt sales revenue, whilst damaging customer and vendor relationships. To transition to digital, businesses need the right data, owned media channels, software, operations and strategy. Anything other than best-in-class risks becoming ham-fisted retailing.
Here are 5 things to consider when transitioning off your print catalogue:
1. Customer needs
From the customer’s perspective, times are tough for many people. And in times of uncertainty people are prone to tightening the household belt and look for savings. There’s a certain irony that some retailers have removed the most famous place for people to find a bargain, right when they need it most.
2. Vendors like catalogues
Our research highlights that catalogues are often the most in-demand owned media channel by vendors. Rightly or wrongly, vendors value catalogues. So, to manage vendor relationships, ensure you have alternative sales driving media channels established and valued before removing the print catalogue.
3. Organisational Implications
For decades, catalogues have been deemed a cornerstone media channel to retailers. They can often orientate an entire business, driving a number of core operations such as pricing, ticketing, inventory management, sales resourcing and marketing. Retail operations and systems need to be considered before action is taken.
4. Refilling the revenue hole
Catalogues are a profitable owned media channel. A major supermarket can be earning well over $100m in revenue from vendors paying to appear in the print catalogue. Yes, there is a hard printing/distribution cost, but there is also a healthy margin. How will this be replaced?
5. Competitive Advantage
With so many retail businesses no longer printing catalogues, in some cases, there may be a competitive advantage to NOT ending your catalogue. At least for a little while. Perhaps even go on the offensive and prioritise your print catalogue in your competitor’s heartland?
Catalogues are a valuable owned media channel. If you want to discuss the future of your catalogue program, contact Sonder now. We help businesses to develop the right strategies for their owned media assets, minimising risk and maximising commercial potential from media.