MERCHANDISING: Web as launching pad

Nov 01, 1999 10:30 PM  By

‘Net joins print as a means of testing and introducing product

As a whole, business-to-business catalogers are still far from transferring all their marketing efforts from their print books to the Web. But some business catalogers are relying on their Websites to test and launch new products.

“The ‘Net gives us the best idea of how a product will sell, because we can get random samplings of interest among customers across the country more easily,” says Kent Frutiger, president of Portland, OR-based A-Ball Plumbing Supply, which sells bathroom and kitchen fixtures.

To keep competitive and stand out from the crowd, “we try to introduce a lot of products that are really `out there’ and unique,” Frutiger says. “The ‘Net is the best way for us to see if they’re going to sell or not in our main catalog.” Nearly two years ago, the $4 million-plus A-Ball used its Website to test a 400-lb. granite kitchen sink that sold for $1,000 – nearly double the price of A-Ball’s typical kitchen sinks. “The ‘Net gave us an idea of how much interest the sink would create. We got a lot of questions and were able to tell that it was a compelling product.” Last year, after receiving numerous inquiries and selling several units of the sink online, A-Ball placed the item in its annual print catalog.

Segmented Web tests

Meanwhile, $3 million Art Source, which sells mass-produced artwork to hospitals, hotels, and other facilities, has found its Website to be a good way to test artwork among specific segments of customers. The New Berlin, WI-based company places new items in the “personal galleries” section of its Website. Customers set up their own galleries by entering information in an online form about their business category and facility, says president/ owner Maggie Smith. Then they can click on the section, enter a password, and see new selections of pictures best suited for their kinds of facilities, rather than sift through hundreds of pictures that might not be appropriate.

Moreover, “our customers don’t often make the buying decision on their own,” Smith says. “They consult with designers. So they can all look at their personal gallery online and make buying decisions jointly, even if they’re not together.”

By channeling specific artwork into customers’ personal galleries, Art Source gets a preliminary idea of how well new items will sell to other customers and prospects. “I also want to eventually use the site to do a focus group study,” Smith says, “in which we would tell customers on the site that these are pieces we’re thinking of publishing,” and letting them send their reactions to Art Source’s buyers. If an item doesn’t get favorable ratings, Art Source may then choose not to publish it in the print catalog.

For Smith, the savings involved in testing and introducing products online is more a matter of time than money. “We don’t print a supplement every month the way a consumer cataloger would. We used to print a 24- or 30-page supplemental catalog twice a year, and it would cost us $7,000-$8,000 to produce,” she says. “So the expense to produce our print books isn’t huge, relatively speaking. But the Web allows us to scan new items in quickly and delete art that goes out of print right away.”

Print lives

Of course, plenty of catalogers are still using the printed page to unveil new merchandise. “Everybody’s thinking the Internet these days, but it really depends on how frequently catalogers mail their print books,” says consultant Katie Muldoon, president of Sugarloaf Key, FL-based Muldoon & Baer. “Some businesss-to-business catalogers mail as frequently as consumer catalogers, and part of their strategy is still to introduce or test new products in those catalogs.”

Such is the case with Hartford, CT-based Executive Greetings, which sells greeting cards, professional diaries, and advertising specialties. The $110 million-plus cataloger, whose titles include Baldwin Cooke, Brookhollow Collection, and Drawing Board, uses fliers, product samples, outbound faxes, and telephone upselling to introduce new products. But over the years it has found that the best way to test items has been to “just put the products in the catalogs and see what happens,” says vice president of marketing Joe Pieri.

“Catalogs get new products to the most people. Most other methods we’ve only dabbled with – including our Website,” Pieri says.

And Executive Greetings has all but stopped using solo mailers to unveil a single product at a time. “The postage and paper involved in mailing solo offers make them too expensive now unless we can get vendor support,” Pieri says. “If we get vendor co-op money, the vendor will pay for part of the marketing cost. In fact, we recently did a program with 22 new products, and got the cost covered by the vendor. That worked out just fine for us.”

As an alternative, consultant Muldoon says some of her business-to-business catalog clients have had success placing new-product insert sheets inside their books. “Inserts placed either between pages 2 and 3 or in the middle of the catalog give customers that sense of urgency,” she says. “They can also look like late, hot-flash-type additions.”