Cataloging Your Success

With a headline like this, I'm sure there are those of youout there thinking, "I own an auto repair shop (or a caféor a consulting company). How is having a catalog going to benefitme?"

Before I explain just why catalogs should be part of almostevery business--no matter whether you sell a product orservice--let me give you some shocking figures on why acatalog-based company is one of my favorite business models.

I'm sure you get at least one catalog in your mailbox everyweek. We all do. And for decades, catalog businesses were the"apple of the eye" when it came to entrepreneurs,old-time retail businesses and investors. Catalog businesses wereoften started at a kitchen table, and many achieved sales in themillions, if not tens of millions, of dollars.

But then the internet came along. Entrepreneurs quit looking atcatalogs as a solid business model, and instead of ink on paper,they chose to put digital pictures on a screen. Print catalogsquickly fell to the bottom of many business owners' popularitycharts.

Don't make that same mistake! I've spent several yearsworking with and for catalog companies, and the numbers I'mabout to share with you are completely true. You may have heard theold rule of thumb that it's five times easier reselling an oldcustomer than it is selling a new customer. The other way of sayingthis is that it's five times more expensive to market to a newcustomer than to an old one. I'm willing to bet the number ofbusinesses that violate that rule outnumber those who don'tabout 99 to 1. Everyone violates it...internet businesses,restaurants, beauty salons, flower shops, plumbers--everyone.

The only businesses that don't violate it are the catalogcompanies. They know better. They know that a profitable businessis best achieved by both attracting prospects into becoming newcustomers and by enticing old customers to buy your products or useyour services over and over again. But you know what? I think the"rule of five" is all wrong! And here's why.

The first catalog company I worked for put out a monthlycatalog. They sold products to businesses, and the average ordersize was more than $200. Each month, we'd send outapproximately 30,000 catalogs to our "house file" or thebusinesses that had purchased from us before. And we'd send outapproximately 70,000 catalogs to company names from lists we wouldrent. These businesses had never purchased from us previously.(Hope you're following the math because this is where it startsto get good!)

From those 70,000 catalogs sent to people who had never dealtwith us before, we'd earn about $70,000 in sales or just about$1 per catalog. Considering that it cost about a $1 just toproduce, print and mail each catalog, you'd be right to betthis wasn't the best way of becoming independently wealthy! Butyou know that business after business out there--all up and downMain Street, in home offices and on the internet--are doing theexact same thing. They keep using up their marketing budgets tryingto attract new prospects--while forgetting all about their oldcustomers.

Now let me tell you what happened to the catalogs sent to thecustomers who'd ordered from us before. Those 30,000 catalogswould generate, on average, $450,000 in sales. If you're payingattention--and you should be now--that's $15 in sales for everycatalog we sent out. I bet you could stand a cool $15 return forevery dollar you spent on marketing, couldn't you? The fact is,catalogs are one of the few marketing vehicles I know that, whenunleashed on a list of your past customers, can return a bushelbasket full of money. The question now becomes, why are catalogs soeffective?

Catalogs have the inherent advantage of just "beingthere." You have to move them and store them; even throwingthem out requires energy. And for many people, catalogs are a primesource of reading material. It's still easier to read ink onpaper than it is to read dots on a computer screen. And pleasedon't give me the lame, "I don't see why catalogmarketing would make me money because I throw out every catalogthat comes through the door without even cracking open thecover." Let me remind you that the difference between amoneymaking promotion and a money loser is quite often less thanone person per hundred, so don't be so quick to dismiss theidea of a catalog, OK?

And what if you're not selling a product but providing aservice? Can a catalog benefit you?

What I suggest to any service provider I work with is to createa small catalog featuring your service. Talk about your expertise.Talk about some of the assignments or jobs you've completed.Talk about the solutions you've provided to help customers orclients out.

Now be aware that what I'm talking about isn't abrochure--brochures just beg to be thrown away because their sizeand general lack of detailed information don't lend themselvesto being kept. On the other hand, an 8" x 10", 12-pagecatalog inherently has the space for more detailed information andis much more likely to be held on to.

A catalog for a restaurant, for example, could be a combinationmenu with the history of and stories about the business. A catalogfor a florist could show a variety of their standard and customdesigns. Say you run a beauty salon. You could take finished photosof your clientele and, with their permission, put together acatalog of hairstyles.

And these catalogs wouldn't have to be the glossy,four-color, 72-page kind you often get in the mail, either.I've come to realize that "cheesy" homemade-lookingcatalogs are often more profitable than those "fancy"catalogs you get in the mail--mostly because everyone gets sick ofthe fancy-looking catalogs and something a little different tendsto stand out.

Then once you have a catalog, I'd use it like a businesscard and give it to anyone and everyone I met, but I'dspecifically try to get it into the hands of people who hadpreviously done business with me.

A great many smart e-commerce business owners have come torealize that offline marketing like a print catalog is often thebest marketing investment they could make. Rising pay-per-clickcosts, spam filters and too many affiliate programs are makingonline businesses both more expensive and less effective thanthey've ever been.

But the number of internet-related businesses that don'thave a print catalog quite frankly astonishes me. Don't allthese website owners know they're losing money hand over fist?Remember, once a website is out of site--off screen--it's outof mind for the person sitting in front of the screen. But having acatalog around the house to pick up and look through triggerscustomers to think about ordering again.

Remember this: Just because a particular marketing tool is alittle long in the tooth doesn't mean it can't put a fewextra "Ben Franklins" in your wallet.

Michael Winicki, the owner of Big Noise Marketing, has workedwith more than 2,000 small businesses over the past 20 yearshelping them become more profitable. Visit his website tofind out how to get a free ad critique or a free over-the-phonebusiness evaluation.