Not-so-jolly Christmas for corporate sales

You probably received far fewer gift baskets and paperweights from clients and vendors this holiday season than in years past. And while you may have been disappointed, catalogers that rely on corporate sales for a significant portion of their business were downright dismayed.

“The corporate sales sector took a hit again this year,” says Richardson, TX-based catalog consultant Tony Cox. “Since sales have been slow for businesses themselves, companies have raised the bar on whom they give gifts.”

Medford, OR-based Bear Creek Corp., which mails the Harry and David food catalog and the Jackson & Perkins horticultural title, felt the pinch, admits spokesperson Bill Ihle. Business-to-business sales represent 10% of the $400 million-plus cataloger’s business. And like consumers in general, businesses were very cautious this year. All told, Bear Creek’s combined holiday sales were ‘below expectations,” Ihle says.

Todd Simon, senior vice president of Omaha Steaks, tells a similar tale. “We’ve struggled” with our corporate gifts business, he says. “Our same loyal customers come back year after year, but they’re not placing as large orders as they used to. Their financials can’t handle the expense this year.” Fortunately, the food cataloger’s consumer business enabled it to meet its plan, which called for low-single-digit growth.

Despite the unwelcoming economic environment, Carson, CA-based food gifts marketer Mrs. Beasley’s launched a 28-page business-to-business spin-off catalog in the fall—a decision that CEO Ken Harris doesn’t regret.

“It was clear business-to-business was driving my sales and profitability,” Harris says. With the help of database services provider Abacus, the $22 million Mrs, Beasley’s realized that 70% of its catalog buyers were business customers, as were 90% of its online customers. Mrs Beasley’s had assumed that b-to-b sales made up 50% of its business.

In addition to mailing a targeted b-to-b book, Mrs. Beasley’s expanded its product line to include wine, cheese, and gourmet snacks as well as its core baked goods and increased the page count of its consumer catalog from 28 pages to 36. All of the changes contributed to the company’s 16% increase in catalog sales.