Good Catalog/Gifts.com for sale

Less than four years after buying Good Catalog Co., Reader’s Digest is trying to sell the gifts cataloger as well as its Gifts.com business.

“We sent out some feelers to potential strategic investors and have had some interest,” confirms Gifts.com president Ralph Pinto. He would not elaborate, but at least one source says that Pleasantville, NY-based Reader’s Digest had started peddling the business to several parties last year.

Reader’s Digest bought Good Catalog in October 1998. The magazine and marketing conglomerate then brought Good Catalog under the same management as that of its Gifts.com catalog and online business. (Although Reader’s Digest is the majority owner of Gifts.com, Denver-based holding company Star Tech owns a 20% share.)

Sources say that, following a sales decline last year, earlier this year the Good Catalog staff was downsized to some 20 people. At its peak in the late 1990s, Good Catalog had nearly 90 employees.

The feeling at Reader’s Digest, according to several sources outside the company, was that the Good Catalog acquisition was a mistake. Good Catalog and its sister book, Good Finds, target affluent men with an average income of more than $80,000; the average order is more than $500, Pinto says. He describes Gifts.com as a “more traditional” gifts business, appealing to women and with an average order value of $100-$150.

Then again, sales at Good Catalog/Gifts.com have reportedly been strong this spring. “The numbers have actually gotten quite good,” says one source. Partnerships with American Express, Diner’s Club, and Discover, in which Good Catalog books were mailed to those company’s cardholders, have helped the division rebound.

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