Catalog Analysis: Understanding Fixed Creative Costs

Creating and producing a catalog is similar to designing and constructing a building. In construction, the architect plays the key role in preparing a set of blueprints from which the contractor constructs the building. He creates physical elevations or sketches of the building and prepares detailed electrical, mechanical, plumbing, and materials plans from which each subcontractor will work. Together the architect and the general contractor prepare the budget and the schedule and hire specialists to prepare the site and build the structure. Building inspectors, the general contractor, the architect, and the client all monitor results, quality, timeliness, and budget.

In catalog creative, the design team plays the role of the architect in developing the master plan, the budget, and the schedule. The art director prepares cover designs and page layouts from which the photographer will shoot, the copywriter will write, and the production person will build catalog pages.

Understanding the role of each aspect of the catalog’s creative budget (fixed and variable) and how the pieces affect the profit-and-loss statement, the breakeven analysis, and the cost to get a customer, among other factors, is a vital part of understanding the finances and metrics of the business.

One of the most-asked questions at catalog workshops is “How much does it cost to produce a catalog?” Let’s define the elements that go into the various aspects of a catalog’s creative budget.

There are two types of creative costs: fixed and variable. Fixed costs are not affected by the quantity of catalogs mailed. They include creative concepting, catalog design, copywriting, photography, illustrations, computer page production, and color separations.

Fixed creative costs are an investment. When you take 200 photos for a new catalog, you hope that you’ll be able to reuse images in future books. Of course, if you produce a new catalog every issue, as in fashion apparel, you’ll have few savings from book to book.

Variable costs are typically measured by unit or by thousand, and they change as the mailing volume goes up or down. Examples of variable costs include catalog printing, order form printing, wrap-arounds, catalog binding, and postage.

This month we’re going to look at the fixed costs of creating a catalog.

Let’s begin with creative concepting. Every catalog goes through this stage at some point — building a creative model that can be emulated time after time. This element requires an understanding of your customers’ esthetic expectations. For a new catalog or a redesign, you may want to examine other books and select those whose covers, layouts, and other design elements are most in line with your customers’ expectations. Part of this element might be formulating and writing down your catalog’s creative platform and brand statement and discussing the target customer base.

Estimated time: one or two days

Estimated budget: $2,000-$20,000

Most catalogers have a formal creative kick-off or hand-off meeting to officially start the project. At such a meeting, which is sort of like a dog-and-pony show, the merchandise staffers review each product, enumerating its specifications and benefits and describing why it was selected for the catalog.

In addition to the product or merchandising team, the catalog art director and the copywriter usually attend the meeting. This meeting typically includes:

  • a review of the catalog specifications, such as the number of pages, the exact trim size, the number of colors, the type of order form, and any special bind-ins;
  • presentation of each item selected for the catalog (if you can’t have every product on hand, at least have a detailed specification sheet along with photos of the absent items);
  • discussion of pagination of the catalog;
  • a description of the target audience;
  • a review of the detailed schedule of what needs to be done by whom and by when;
  • discussion of mailing information including mail date, expected in-home date, mail quantity, and expected results; and
  • identification of the color separator, the catalog printer, and the order form printer for the project.

With each subsequent catalog, this process becomes somewhat easier. Repeated items need not be given the same attention as new items.

Estimated time: one to three days, depending on the number of items

Estimated budget: $3,000 and up

The first phase of the actual design of the catalog involves preparing cover and page concepts, often as black-and-white thumbnail sketches. Once all agree on the cover and page design, the art director will develop full-size cover and page concepts, usually in full color. Generally catalogers come up with two or three new cover ideas and three or four spreads.

At this time all involved should agree on key design elements, such as the logo and the positioning line; the type of photos, illustrations, and typography to be used; and the use of color and white space. You should also discuss what I call spread graphic treatments — alternative layouts, editorial sidebars, headlines, and captions.

Estimated time: one to two weeks

Estimated budget: $5,000 and up

The next stage involves completing detailed layouts of every page of the catalog, including the order form. The spreads show all the details that the photographer and the copywriter need to do their jobs. Several revisions of the layouts are not uncommon.

Estimated time: two to three weeks, depending on the number of pages

Estimated budget: $150-$250 a page

These layouts are then turned over to the photographer and the copywriter. Many details make up the photography budget. The catalog designer or the art director directs the shoot and controls the budget, which includes the following elements:

  • actual shots — charged by the photograph or by the photographer’s day rate. Generally, there are five types of shots: cover shots; difficult (read: costly) ambience shots on location or with models; complicated, heavily propped shots; simple (cheaper) table-top shots; and simple silhouetted shots;
  • film and processing, including Polaroid preshots;
  • stylist (especially with food or clothing);
  • photo art direction;
  • model fees;
  • props and set building;
  • handling and procurement of props and accessories; and
  • location rental.

The photographer’s bid should include a waiver that the catalog owns all photo rights and that there are no residual fees of any kind. This is common with catalog photography, not so common with other types of advertising photography.

Estimated time: 8-15 shots a day, depending on the complexity

Estimated budget: $100 a photo-$1,000 a photo, depending on the complexity and the styling required

Meanwhile, the copywriter prepares to draft copy to the exact specifications of the layouts. Proper layouts specify the number of lines and characters per line so that the writer knows exactly how long each copy block should be. The copywriter also creates headlines, captions, charts, editorial sidebars, and welcome letters.

The writer submits copy on disk as well as on paper for editing and easy correction. Product numbers and prices are entered into the copy, and every element is scrutinized. One set of copy revisions is standard. Beyond that, extra costs are incurred.

Estimated time: two to four weeks, depending on the number of items and pages

Estimated budget: $5,000-$15,000, depending on the number of items and pages

Page production is where all the elements of the catalog are put together into an electronic file that will be used for color separation and printing. Included in this budget:

  • computer page production of each page;
  • computer page production of the order form;
  • proofreading;
  • disks, CDs, and other production materials;
  • preparation of the file for the color separator;
  • delivery or messenger charges; and
  • art director supervision.

Most catalogers have at least two sets of revisions to the pages, which must be built into the budget. Revisions beyond two sets can run into significant additional costs.

Estimated time: two to three weeks (more for larger-paged catalogs)

Estimated budget: roughly $200 a page

Note: Changes to prices, products, and item numbers are considered alterations and will be charged accordingly, depending on the stage at which they takes place.

A great deal of planning, bidding, and accounting for all the costs is required in building a winning catalog. The sum of the fixed creative costs represents a major investment that needs to be controlled and proactively managed — either internally or by a third party specializing in catalog production.


Jack Schmid is president of J. Schmid & Associates, a Shawnee Mission, KS-based catalog consulting firm.

Blueprint for a Budget: Fixed Creative Costs

SPECS: 32-page, four-color catalog with four-page order form. Includes one cover change, 50% new products, and a rearrangement of existing items. Finished project includes electronic file with low-res automatic picture replacements (APRs).

I. CREATIVE CONCEPTING

Includes the creative concept development and initial kick-off meeting to discuss the creative platform, brand, pagination, merchandise hand-off, and review of past results. Also includes development of offers and discussion of ongoing catalog strategy.

II. DESIGN

Development of two or three spread layouts and cover concepts for approval (typically includes two rounds of rough layouts). Once these layouts are approved, the rest of the catalog is laid out.

  • Layout and design

    • Page concepts and cover layouts
    • Page layout
    • Order form design and layout
  • Conference, travel time, and project management — includes time spent with the copywriter, artist and others defining the project and target audience

    III. PAGE PRODUCTION

  • Production

    • Computer page production (includes two rounds of changes)
    • Disks, CDs, and other production materials
    • Order form production
    • Proofs: two sets of black-and-white and two sets of color
    • Preparation of proofs and files for color separator
    • Additional art elements, icons, and Photoshop manipulation
  • Copy — review and editing of existing copy and writing of copy for new products (cost depends on pick-up vs. new product)

  • Expedited couriers, messenger service, faxes, etc.

  • Project supervision

    IV. PHOTOGRAPHY

    • Includes film and processing
    • Cover shot (cost depends on complexity)
    • Location/model shots
    • Propped/complicated product shots
    • Simple tabletop shots
    • Apparel stylist/food stylist/assistant stylist
    • Photo art direction
    • Models
    • Product handling
    • All props and set building (quoted upon completion of layouts)
  • All client alterations are additional.

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