The Best of Direct Commerce--September 2011

This month in Direct Commerce...

The September issue of Direct Commerce lands on desks this week, if you’re a subscriber, here’s what you can expect:

A Focus on M-Commerce—including advice on preparing a mobile strategy, considerations regarding mobile payments and fraud, best-practice ideas for mobile site optimisation, and much more

Because Print Works—introducing our campaign recognising the business-building power of print in today’s direct commerce world, plus a guide to producing your first catalogue.

Website Review—our contributor assesses the website of baby-gifts seller Born Gifted

Q&A With...—we talk to Aaron Chatterley of Feelunique.com about the company’s recent growth and where it’s heading

Plus: the latest industry news, a beginner's guide to catalogue production, tips on how to love your customers, and more.

The only way to read Direct Commerce from cover to cover each month is to subscribe. A one-year subscription also gives you full access to the www.catalog-biz.com website and an archive of past issues. To have the print edition of Direct Commerce magazine delivered to you, or to set up an online-only subscription, visit www.catalog-biz.com/subscribe.asp.

ECMOD Direct Commerce Conference

Now in its 21st year, the ECMOD Direct Commerce Conference 2011 will feature top US speakers as well as home-grown talent. Taking place at the Business Design Centre in London on 30th November and 1st December, the multitrack conference covers a vast range of topics geared to helping direct sellers from all sectors optimise business performance.

US ecommerce guru Amy Africa returns to ECMOD this year to lead a session titled 40 website must dos on 30th November. While the following day, fellow Americans Dan Lowden of mobile commerce specialist Digby and Direct Commerce contributor and systems expert Ernie Schell will discuss making mobile work for multichannel.

Among the UK speakers, Peter Harris takes to the stage to tell the Hotel Chocolat story and respected UK entrepreneurs including Dwell’s Aamir Ahmad, Worldstores’ Joe Murray, Charles Tyrwhitt founder Nick Wheeler and Scotts & Co chairman Nigel Swabey, among others, will talk business growth in the Gallery Hall—a theatre-style space within the Business Design Centre capable of seating 600 delegates. 

Check out also the Digital Leaders track for the latest on emerging technologies. Sessions include maximising online ROI, led by Matt Curry of Lovehoney and Amberlight’s Jeremy Swinfen Green; Geoffrey Barraclough of BT Expedite, Will Dymott of Lyle & Scott and Mick Rigby of Yodel Mobile on m-commerce and Andrew Copeland of Webgains on behavioural retargeting on performance metrics. And don’t miss Facebook’s session on social commerce.

There’s plenty also on offline techniques, including profit by design, hosted by catalogue design specialists Tony Adams of TA Design and Ian Simpson of Catalogues 4 Business; the secrets of success in TV Shopping led by Mike Hancox of Ideal Shopping Direct, Pete Mills of The Broadcast House and Stuart Paver of shoe retailer Pavers. On back-end processes, Direct Tech’s Joe Palzkill will discuss optimising inventory.

In addition to a new venue, this year’s ECMOD is colocated with Data Driven Business Week’s exhibition and Conversion Conference, eMetrics Marketing Optimization Summit, and Predictive Analytics World conferences. A specially designated zone of the ECMOD Direct Commerce exhibition floor will feature Data Driven Business Week sponsors and exhibitors—providing added value to delegates and visitors. The exhibition is, once again, free-to-attend and visitors can preregister by visiting www.ecmod360.co.uk.

When: 30th Nov – 1st Dec 2011
Where: The Business Design Centre, Islington, London
Web: www.ECMOD360.co.uk/conference

August Catalogue Log

This September, Direct Commerce launches its new Because Print Works initiative. The campaign’s aim is to ensure that print catalogues, inserts, press and magazine advertising and customer magazines get the full attention and credit they deserve as vital components in the marketing mix for successful multichannel businesses. Happily, to coincide with the launch, last month’s catalogue volume was the highest it’s been for the month of August since we began writing the Catalogue Log.

We received 87 catalogues last month, compared with 61 catalogues in August 2010, and 71 catalogues in August 2009. The reason for this uplift? I’ve noticed that in August cataloguers sent a sale catalogue and a new-season mailing. Lakeland, for example mailed a gardening-themed sale catalogue and its 128-page Autumn book, a similar tactic was employed by The White Company and Museum Selection.
Another strategy was to supplement a mailing with inserts in the national press, something Thompson & Morgan did last month. Or to send catalogues in product despatch. I received the main Nisbets catering equipment catalogue in the post, and then received a sale minicatalogue with my order—a pair of tough kitchen scissors, if you’re wondering.  I also liked Dwell’s strategy to send its main furniture catalogue and complement it with the smaller “Decor” title, showcasing its range of home accessories.

Also noteworthy was that even with the additional volume the sale and minicatalogues provided, 40 percent of all catalogue covers in August did not make any mention of a special offer. Compare that with July, when the figure was just 31 percent out of 64 catalogues. Of the catalogues that did promote a deal on their covers, a sale or discount was the most popular promotion. Offered by 39 catalogues, or 44.8 percent, discounts ranged from Argos’s “less than half-price” offers on student essentials to Dell’s “save up to £520 on selected systems”. My favourite offer was a Sunday Times insert from Boden, which offered readers 15 percent off, free delivery and returns and a free wash bag for new customers. Regular Catalogue Log readers will remember Boden did the same this time last year and the year before.

No prizes for guessing that the next most popular special offer was free delivery, now commonly teamed with free returns. Promoted on 18.4 percent of the covers we tracked, free shipping was marginally less popular in August than in July (21.9 percent) and appreciably less than in August 2010 (23 percent).  To curb the costs of offering free delivery, many of the cataloguers arriving in our offices offered it over a certain threshold—apparel catalogue M and M Direct, for example, set a £50 minimum order value, while charity catalogue Traidcraft only required customers to spend £15 to qualify for free delivery. At Prelude, the Scotts & Co/Alexon catalogue, customers could enjoy free shipping if they order before 23rd September, a trick to encouraging an early influx of sales.

In contrast, free gifts were more popular in August than they had been in July. In fact, it was the highest figure we’ve noted since April. The offer was promoted on 14.9 percent of catalogue covers, predominantly by gardening and b-to-b mailers such as Van Meuwen, Spalding, Rajapack, and promotional products catalogue IGO Post, which gave customers the choice of a free gift or a £75 discount. Other catalogues touting a free gift were Cotton Traders (a free roll neck with a jacket), Healthy Living Direct (multifunction pocket tool and “two surprise gifts”) and JML, which offered me a free super slicer worth £9.99, if I spend more than £50.
On a side note, we also received our first Christmas catalogues in August—from Findel’s 24Studio and N Brown’s The Brilliant Gift Shop. Interestingly, both these catalogues offer customers the choice to buy on credit. They mail early presumably to encourage customers to spread the cost over the next four months.  Whether “cash-with-order” catalogues will follow suit with early mailings remains to be seen; as we all know, Christmas is getting later every year…--MT

Paying a premium

First there was Amazon Prime, then came Asos Premier, now M and M Direct has launched its Premier service, offering customers free express delivery, free returns, priority mailings and exclusive offers.
Amazon Prime, Asos Premier and M and M Direct Premier are membership programmes that charge customers an annual fee for added-value services. Amazon’s service costs £49 a year; Asos currently charges £14.95 and M and M Direct charges £14.99 as an introductory price. But do they represent good deals for the merchant and the consumer?

I looked at joining Amazon Prime, but could not see any immediate benefits as a consumer. Sure, I could get “free one-day delivery on millions of eligible items sold by Amazon.co.uk”, but what about the items sold by third-parties on the site; not all of those are eligible. Not to mention that most items are eligible for Amazon’s free super-saver delivery anyway. I may have to wait up to five days to receive my purchase, but if I wanted it sooner I’d pay the one-off delivery charge. For most items I am happy to wait a few days. Although my family buys a lot on Amazon, I don’t think our shipping costs rack up to £49 a year. Thanks, but no thanks. This offer clearly works out better for Amazon and if people are willing to pay £49 when they could get a very similar service for free, Amazon is definitely the smartest marketer out there.

The Premier offer from apparel etailer Asos is instantly more enticing for consumers. It offers free next-day delivery as well as a returns collection service. I can see the immediate attraction of not having to trudge to the post office to return a parcel. Another benefit, at least for a catalogue nut like me, is that Asos will mail its customer magazine to Premier customers each month. I have bought from Asos a couple of times over the past year or so, but they’ve not sent me a magazine for several months. I was told by a customer services rep that “we send out the magazine every month to a random selection of people who have ordered from us in the last six months. This means that if you keep ordering from us you will receive the Asos magazine,” she directed me to the online version, but it’s just not the same. For £19.95, or even the full price of £24.95, the Asos Premier deal is much better than Amazon’s. As Asos already offers free delivery with no minimum order value, albeit not next-day, I guess the Premier service is a way to reclaim revenue from deliveries. It’s also a great way for Asos to communicate directly with its very best customers. Plenty of online retailers can segment their databases to find out who among their customers buys the most often. But using a service like Premier, Asos knows exactly who its most engaged customers are. To use a much-bandied term, the people who subscribe to a service like Premier are likely “brand advocates”, willing to pay extra for a service from their favourite retailer. Impress these people and they will tell their friends, who may then also join the service, who will tell their friends, and so on.

M and M Direct’s offer is very similar to Asos. It includes free express shipping, free returns, “priority mailings” and exclusive offers. Already, M and M says 50,000 people have signed up to the programme since March. Again, like Asos, M and M calls out receiving regular catalogues as a key benefit. Its non-offer price is £19.99, cheaper than Asos’s full price. The real added benefit here is that M and M Direct normally charges £6.99 for express delivery and £3.99 for standard delivery compared with Asos and Amazon where customers can opt for free delivery on most items. That means that the service essentially pays for itself after just two orders. For regular shoppers, that’s a very tempting deal.

If I genuinely shopped that often with a retailer, paying for a premium service would definitely appeal. It’s a concept that would work for anything purchased regularly--pet supplies, vitamins and supplements, home-office supplies, childrenswear and baby products, and so much more. If margins permit, we may see many more of this premium services crop up. After all, there’s nothing customers love more than being treated like VIPs.--MT

You'd better smile

Readers of a certain age would remember a song called Smile by the Supernaturals. The word smile is repeated 15 times during the chorus. I was reminded of that tune when I saw this spread from a recent Bravissimo catalogue. Now, we’re told smiles sell, but I think Bravissimo could tone it down a little…--MT

July Catalogue Log

In July 2009 we received 149 catalogues. In July 2010 we received 91 catalogues. Last month we tallied just 64 catalogues—a decline of 30 percent on last year and 57 percent down on two years ago.
Up until now, catalogue volume had been mostly in line with 2010, but July’s crop took a nosedive. A quick look at the data shows we’ve slipped off a number of lists including apparel retailers MandM Direct, Cashmere Centre and Peter Hahn. On the other hand, this year we’ve received mailings from clothing catalogue Peruvian Connection, childrenswear boutique Marie Chantal, and personalised apparel specialist Spreadshirt—so plenty of new names to top up our catalogue stocks.

 

So what’s the reason for the decline? It could be that, as we’ve suspected before, we’re dropping off more lists than we are added to. No-one wants to waste money regularly mailing a prospect that hasn’t bought in longer than 24 months. Another reason, mentioned by our publisher Jane Revell-Higgins recently, was that there seem to be fewer inserts in national media. We noted only a minor difference of five catalogues, but it is nonetheless, a decline.

Another potential reason is that we are at the height of the summer sale season. Perhaps a tighter control on margins means fewer markdowns and less stock to shift in the sales? You tell me.

But back to the stats. Of the 64 catalogues we logged, just 20, or 31.3 percent, made no mention of a special offer on the cover. That makes July our most promotional month to date, beating February’s record of 32.7 percent. The most popular promotion was a sale or discount, touted on 54.7 percent of all the covers we looked at. Fashion brand Fat Face, apparel and home retailer Laura Ashley and homewares catalogue Peacock Blue all sought to tempt us with money off our order.

Free delivery was the second most popular promotion, offered by 21.9 percent of the catalogues we tracked. Again, this was one of the highest percentages we tracked—significantly higher than June 2011’s 12.3 percent, and just a whisper away from February’s 22.1 percent. Many catalogues elected to set a threshold for a free delivery offer, including charity mailer RNLI, which required customers to spend £25 before qualifying, and educational toys cataloguer the Happy Puzzle Company, which made free shipping available to those who spend £40 or more.

Also more popular, albeit marginally, was a free gift with purchase. It was promoted on 10.9 percent of catalogue covers in July, compared with 9.8 percent in June. My favourite was an offer from Laithwaites Wines, which teamed with Pong Cheese to offer buyers of its Italian wines a selection of free Italian cheeses.  I was also quite taken with apparel cataloguer Long Tall Sally, which mailed me a £20 gift voucher to put towards whatever I liked—no minimum spend, no strings attached. That was definitely an offer too good to miss for the consumer, but it makes me wonder how Long Tall Sally can afford to give every name on its database £20 for free.--MT

Cover story

What would you say are the most important messages to convey on a catalogue’s front cover? Essential, in my opinion, are brief how-to-order details such as a telephone number and website URL.

Most catalogues then opt for including some sort of special offer or benefit, for example “100 new products!” or “Free delivery when you spend more than £50”.

Furniture retailer Furniture Village does all that—a prominent web address and a flash in the top-right corner informing customers they can save up to 50 percent in the Furniture Village sale. But here’s something I’ve not seen on a catalogue cover before: “all stores fully air-conditioned”.

Is this an important selling point? Does it imply that other furniture stores are uncomfortably stuffy? Would the lure of climate control sway a catalogue recipient who perhaps ultimately orders online?

It has been a while since I needed to buy a sofa, but I don’t recall air-conditioning helping me make a buying decision. It seems an odd choice for a cover line, but maybe Furniture Villages knows something we don’t and we’ll finally get the barbecue summer we’ve been promised.--MT