SPIN-OFFS: Good Catalog going great guns

Since buying the $30 million-plus Good Catalog Co. last October, Reader’s Digest has been “very pleased” with results, says Jim Steffensen, vice president/general manager of catalog for the $2.6 billion magazine publisher/direct marketer. And Reader’s Digest is rewarding Good by helping it test six new titles.

Good’s first-quarter sales for 1999 were 50% higher than for ’98, according to Steffensen. And Barb Todd, president of Portland, OR-based Good, expects sales to grow 30% for the year, to nearly $40 million, with “great” profit increases.

The company no doubt expects its test books to contribute to the bottom line. Two of the spin-offs – a gifts books and a books and tapes catalog – use Reader’s Digest’s sweepstakes programs to build interest. The third title, Good for You, which sells health-related products, is being tested in an A-B split, with the Good Catalog title on half of them and Reader’s Digest on the other half. All three books mailed this spring to 250,000-500,000 prospects each, according to Bill Nicolai, Good’s vice president of marketing.

Good is also testing with Reader’s Digest a catalog in Canada. Called Home & Leisure, the 24-page gifts book was created and merchandised by Good. “Reader’s Digest has an existing Canadian operation from which we’ll provide lists,” Steffensen says. Reader’s Digest plans to truck all orders into Vancouver, B.C., placing them in the hands of Canada Post, the Canadian postal service.

Home & Leisure tested in mid-April with a mailing to 250,000 of Reader’s Digest’s Canadian customers. Like Good for You, it is testing in an A-B split of the Reader’s Digest and Good Catalog logos on the covers. And like the gifts and books spin-offs, Home & Leisure will include a sweepstakes. If the test pans out, “it could turn out to be a really sizable rollout,” Todd says, though she won’t specify a circulation figure. A second test mailing is scheduled for late August/early September.

And as if that’s not enough, Good will test two other gifts catalogs this fall, bringing its total number of titles to more than a dozen. Nicolai is particularly keen on the gifts book that will mail to several hundred thousand middle-income names from the Reader’s Digest database.

“It’s selling the same general merchandise, but we’re targeting it to a very different demographic from the upscale customers [with a household income of at least $70,000] that we typically target,” Nicolai says. “And it represents a much larger market. If successful, this book could do more than the rest of our company combined.”

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