After what senior director of catalog marketing Eric Bright calls “several tough years,” Salt Lake City, UT-based productivity tools merchant Franklin Covey is on an upswing. The company credits much of its comeback to Insightful Design, a spin-off title of women’s handbags and business cases it began mailing less than three years ago.
Franklin Covey mailed 850,000 copies of the first issue of Insightful Design in fall 2003, mostly to rented names of professional women and working mothers. The company would not reveal response rates, but results were strong enough that it increased circulation 61% in 2004 and added another edition; in 2005 it boosted circ 81% and increased the number of editions to three.
“Since Insightful Design is a spin-off title, its average response rates are still only about a quarter of those of our core catalog titles, but revenue is showing steady growth,” Bright says. Sales from Insightful Design increased 14% between 2004 and 2005. Franklin Covey has 15 titles in all.
Insightful Design was meant to leverage much of the company’s existing product line, although items were tweaked to make them more fashion-forward. “We hoped the new line would be a good fit with what we were already selling,” says Cherell Jordan, senior director of product management. “We already had a line of business and computer cases out there and hoped the fashion twist would sell the line.” The average price point for Insightful Design is $150, and at $120, its average order value is about 55% higher than that of Franklin Covey’s other titles.
Franklin Covey was formed in 1997, when time management company Franklin Quest merged with productivity guru Stephen Covey’s Covey Leadership Center. But Bright says the two cultures did not meld well, with a lot of infighting over what was best for the future of the new company.
“Both companies had hit peak as single entities and were on the downward side,” Bright admits. “Very heavy cost structure, declining revenues and margins in an ever-changing market, and 9/11 all were severe blows to our business. Given that much of our revenue comes through b-to-b, as overall [business] spending dropped our financial prospects declined.” A marked decline in sales of personal digital assistants, which had been the bedrock of Franklin Quest’s business sales, did not help matters. Bright says the company spent the next few years trying to find its way back.
Insightful Design has helped. This past September, the company expanded the line to include wallets and smaller bags, and also added travel items and more totes. Bright says that Franklin Covey may add a line of men’s business cases later this year.