Rather than get stuck in a price war, use branding and service to set your company apart
If your catalog specializes in unique or hard-to-find merchandise, building a market is simply a matter of convincing customers that they need the item and can buy it from you. But when you sell a commodity item that many competitors also sell, how do you make yourself stand out from the competition? It’s all too easy to get embroiled in a price war. Instead, catalogers can use branding and value-added services to set themselves apart.
The benefits of one-stop shopping
Data Comm Warehouse, which has fallen victim to price wars in the past, has learned to compete on factors other than price. The catalog, part of Norwalk, CT-based Micro Warehouse, sells a wide selection of computer networking products, such as routers, cables, and modems.
“We have actually had competitors go through our catalog and offer all the same products for a dollar less than we do,” says Tony Calabro, vice president of publishing for Micro Warehouse. The $2.2 billion Micro Warehouse mails about 1.5 million Data Comm catalogs each month.
This experience taught the company the value of emphasizing not only price and selection but also service and brand. “There was a time when we just put more and more deals on the front cover,” Calabro says. “The whole book was nothing but deals. But we have found that we really have to start selling the company, not just the products. Now we’re using a lot of branding headlines in the book that explain our leasing and software licensing programs and our tech support, and that emphasize our wide selection of approximately 30,000 products.”
Dyersville, IA-based TekSupply, which sells equipment to the agricultural, building, and retail industries, also plays up its broad product line. In its marketing materials, the $50 million cataloger, which mails nearly 10 million catalogs a year, explains to customers and prospects that buying as much inventory as possible from one vendor — using one purchase order — cuts processing costs and manhours in the long run.
“Multiple purchase orders are an expensive proposition for our customers, although they’re not always recognized as a key cost,” says executive vice president Tim Bidwell. “If a customer purchases 50 products from 50 vendors, it is significantly more expensive than if he buys all 50 products from one vendor, all on one purchase order — even if the product might be at a slightly higher price.”
TekSupply promotes its wealth of product knowledge as well. The cataloger assigns an account manager to each customer. This account manager then gets to know the customer’s business intimately and can provide knowledgeable advice — in effect becoming a partner to or resource for the customer.
Digi-Key Corp., which distributes electronic components, competes against more than 800 mostly regional players, says Steve Tsukishi, vice president of marketing. So the $373 million cataloger strives to show customers and prospects that it’s the little things — small efforts that Digi-Key can make — that count.
For instance, unlike many of its competitors, the Thief River Falls, MN-based cataloger does not have minimum-order requirements. This addresses a major need of a significant part of Digi-Key’s market: engineers who are designing prototypes that their companies will, hopefully, soon manufacture in mass.
“Essentially we work to get our parts designed into the final products,” Tsukishi explains. “So we provide an avenue for these engineers to buy small quantities — prototype design quantities much smaller than what would typically be manufactured for sale. Because we have strong operations internally, we can pick small orders profitably.”
Associated Bag Co., a Milwaukee-based cataloger of packaging and shipping supplies, promotes its overall speedy service, particularly within the region. “In [catalogs mailed to] the local area, we advertise that we can get our products to customers more quickly,” says marketing production manager Kathy Stack. Outside the area, it sticks with a more general message of delivering the best service at the lowest price.
Standing Out from the Crowd
They may sell similar merchandise to similar audiences, but these catalogers demonstrate how easy it can be to distinguish your company from the competition.
From its cover (bottom left), it’s clear that Tempe, AZ-based Direct Safety Co., which sells industrial safety supplies, promotes value above all. A callout highlighted by a yellow oval declares “Free delivery on all orders over $275.” And in bold yellow type the cover line reads “Save Over 25% On Select Products.”
The cover of Madison, WI-based Conney Safety’s catalog (below) makes no mention of prices, savings, or special deals. Instead, it positions itself as, in the words of its prominent cover line, “Your Safety Problem Solver.” The tagline, “Complete Head-to-Toe Protection,” emphasizes the point, as does the cover listing of more than a dozen product categories and their corresponding page numbers in the catalog.
Excellent service and an exhaustive product selection are the features Postal Products Unlimited, based in Milwaukee, highlights in the opening spread of its catalog (top right). The inside front cover explains the mailroom supplier’s expedited shipping programs, free layout planning service, and ability to custom-design mail center gear. Opposite is a full-page index bursting with photos, to let mailroom professionals know that whatever they need, Postal Products has it.
The opening spread of the Charnstrom catalog (bottom right) is devoted to promoting the company’s own brand of sorters: “Strong steel sorters designed to handle your toughest jobs!” according to the headline. “Charnstrom Sorters are based on an innovative modular design. This makes it easy for you to get a Sorter System that suits your particular needs and change it or add to it as your company grows….” the copy continues. And the lifetime guarantee is prominently displayed with an icon that is repeated throughout the book. In all, Skakopee, MN-based Charnstrom plays up the quality and versatility of its brand.