If Amazon’s doing it, the trend must be real, right?
The eCommerce operator plans to print a holiday catalog, reportedly for distribution at Whole Foods and via mail. The 100-page catalog would arrive near the end of October for kids to look through and create wish lists before December — filling, perhaps, the void left by Toys R Us when it went out of business (in part because of competition from Amazon and other online retailers).
Let’s not overstate the case, though.
IKEA will reportedly reduce the print run of its 2019 catalog by 50 percent. “We’re sharing content in new ways because consumers are consuming content in new ways,” said Kendra Ferguson, media project manager for IKEA North America. “We’re doing more digital and having experiences so people can interact with us more.”
Even some major retailers famous for their catalogs are shifting more to digital.
Williams Sonoma is one example. Online retail accounted for 53.7 percent of the company’s retail in the first quarter of 2018, a record high for the company, said Chief Financial Officer Julie Whalen in the company’s post-earnings conference call. (Q2 results are scheduled for later this month.)
Much of that eCommerce growth stems from the company “continuing (its) transition from catalog mailing to higher-impact digital channels as we further refine our marketing mix to drive short-term ROI and long-term gains and customer growth,” President and CEO Laura Alber said during that same call.
According to the Data & Marketing Association, 9.8 billion catalogs were sent to U.S. consumers in 2016, down from the peak 19.6 billion in 2007. The paper catalog is in a clear decline despite recent revivals.
Paper Catches Eyes
But more consumers are paying attention to those catalogs than was the case a decade ago, the trade group says — 42 percent of consumers read catalogs that come through the mail.
Mainly, decreased competition. As consumers and retailers further embrace digital marketing, a paper catalog that arrives in the mailbox can stand out. Consumer responses to paper catalogs are seeing an upswing: The trade group said that more than 100 million U.S. consumers make catalog purchases annually.
That’s one reason some retailers are stepping up their catalog efforts. For last year’s holiday season, Neiman Marcus Group ran “a social media contest for 1,500 photos capturing happy moments to be featured in a cover collage,” according to one report. “And home furnishings (online retailer) Wayfair.com started mailing full-line catalogs only last year.”
The heft of those catalogs has attracted ire from environmental groups, the company said in SEC filings, but “our Source Books are one of our primary branding and advertising vehicles. We have found that merchandise assortments displayed in our Source Books contribute to increased sales of those products across all of our channels.”
More Frequent ‘Drops’
Over the last few years, the retailer has steadily increased its advertising spending — a category that includes costs associated with catalog mailings — with that total reaching nearly $107 million in fiscal 2017, up from about $80 million in fiscal 2016. The company, however, is also spending less on “third-party incremental direct costs to prepare, print and distribute Source Books,” with that total declining to about $44 million as of Feb. 3, 2018, down from $61 million for the same time in 2017.
The catalog plan for 2018 includes more frequent “drops” of catalogs, according to Karen Boone, the company’s president and chief financial officer, during Restoration Hardware’s most recent post-earnings conference call. “So last year we had modern drop in the spring and interior drop in fall,” she said, referring to design styles, “and now we have two drops of interiors – one in the spring, one in the fall – and two drops of modern, one in the spring, one in the fall.”
When it comes to the future of paper catalogs, a lot could ride on Amazon’s level of success during this year’s holiday season. Will it do more than strike nostalgic chords? And the balance struck by Williams Sonoma as it tries to shift further into digital without losing the loyalty of its catalog fans could also signal future developments — as could Restoration Hardware’s experiences with this year’s Source Book distribution. If the paper catalog is really making a stand, the coming months could bring clarity.