According to CATALOG AGE’s Benchmark Report on Operations, which will appear in the April issue, a mean 35.5% of catalogers’ orders come via the Web. So it stands to reason that Internet buyers account for a growing share of catalogers’ print circulation.
But Web buyers often have different demographics and other characteristics than traditional catalog buyers, says Jim Coogan, president of Sante Fe, NM-based consultancy Catalog Marketing Economics. Therefore, you can’t assume that the same circulation strategies and marketing tactics that are profitable when used among traditional buyers will yield the same results among Web buyers.
Managing Web buyers profitably requires understanding of their key metrics, Coogan says. Chief among them is measuring the incremental sales gained by mailing a print catalog to a Web buyer.
To figure that out, you need to segmenting buyers by order channel as well as by recency/frequency/monetary value (RFM). And when segmenting Web buyers, Coogan adds, be sure to divide them into two groups: those who have never received a print catalog and those who have.
Coogan also suggests segmenting Web buyers by source: natural search, paid said, e-mail, affiliates, URL, print catalogs. His other suggestions regarding testing and segmenting of online buyers include:
* Find which Web buying households are mail order responsive and which are not by using optimization programs available through cooperative databases.
* Test the contact strategy mix of catalogs, e-mails, other forms of direct marketing as well as promotions to Web buyers.
* Test different promotional offers and creative approaches.
* Segment holiday-season or gift-giving Web buyers.
* Segment Web buyers by unique merchandise segments (such as products found only on the Web and not in the catalog).
* Test different strategies to convert Web requesters vs. traditional catalog requesters.
* Measure the difference between traditional catalog order curves and Web buyer’s order curves.
“Web buyers respond profitably to catalogs,” Coogan says. “But often they respond very differently to catalogs than classic mail order buyers do, and a merchant needs to know the differences with this emerging class of buyers in order to tailor his circulation strategy for the maximum impact.”