J.C. Penney brings back catalog strategy to drive online sales
Five years after discontinuing its “Big Book” catalog, J.C. Penney plans to return to a modified print catalog strategy, finding through analysis that online sales were partly driven by what the shoppers first saw in print.
The traditional "Big Book" catalogs, launched in 1963, were delivered three per year with some reaching 1,000 pages. Much of the catalog focused of fashion. In 2009, Penney discontinued the "Big Book" and phased out its distribution of 70 smaller catalogs targeting niche areas such as school uniforms, kitchen products and window coverings a year later.
Eliminating the expense to produce and distribute a print catalog as well as the complaints heard from customers about catalogs piling up unread in mailboxes, Penney also initially thought catalog shoppers would simply shift to buying online. But the company found a large amount of online shoppers had a catalog with them when making an online purchase. Penney CEO Mike Ullman told the Wall Street Journal, "We lost a lot of customers."
The 120-page revived catalog, to be mailed in March 2015, will focus on home department goods and target select customers, or what Mr. Ullman described as "lapsed customers." Home goods have historically been among the top-selling items in Penney’s catalogs and the category accounts for 40 percent of online sales. Pottery Barn, Crate and Barrel and West Elm also use a strong catalog component to support their business.
Penney’s reverse comes as The Direct Marketing Association reported that the number of catalogs mailed in 2013 increased for the first time since 2006. J. Crew Group, Williams-Sonoma, Bloomingdale’s, and Saks are also among the retailers that still invest heavily in print.
Speaking to NPR, Trish Hagood, who runs MediaFinder.com, the online database of catalogs in the U.S. and Canada, said good catalogs continue to help shoppers navigate through the clutter. She said, "The Internet has gotten so big that you can’t find anything on it."
Discussion Questions
How would you characterize the relationship between print catalogs and e-commerce purchases? What do you think of J.C. Penney’s decision to bring back its catalog?
It’s generational. In another 20 years shoppers will be looking up the word catalog (online, of course) when they run across it in an article on ancient marketing techniques.
Seriously, some catalogs will survive, especially those serving upscale or niche markets, but the decision to bring the “Big Book” back is just too little and definitely too late.
JCP needs something, but this isn’t it.
There still must be a following for catalogs. I have not personally used one in the last 15 years and can’t recall a single reference to a catalog by anyone I know. Sears still has them and I can’t recall a single reference to them. In the B2B world, catalogs seem to work better.
My spurious reaction to this was “another nostalgic swing and a miss” for JCP. Then I thought about how I shop. How many times did the immediacy of a print piece in hand when I was sorting the mail compel me to glance through? And if the items targeted were relevant to me (and they are more often now thanks to CRM systems) —how many times did that prompt me to jump online to buy? I was surprised at my conclusion.
I still think targeted online advertising (opt-in via email alerts primarily) is more immediate and compelling in terms of purchasing, but print still has its place.
This makes sense for JCP as a way to focus more attention on its home store, and as part of an integrated omni-channel strategy. There is no reason why a well-focused catalog shouldn’t drive both online and brick-and-mortar sales. And JCP is counting on the revival of its home store to help drive its sales recovery plan during the next few years. So I’d give this a thumbs-up as a relatively low-risk tactic.
I think bringing back the catalog in a targeted way—as the article mentioned, focusing on lapsed customers—is a great decision and an excellent use of shopper data.
This idea reminds me of yesterday’s discussion about experiential e-commerce. The same editorial ideas can be used in catalogs for less tech-savvy shoppers to draw shoppers into stores or online catalogs. It’s more about sparking an impulse to shop than it is about listing what items are for sale.
Omni-channel means “many” sources. Many of today’s consumers still respond to print, especially for aspirational items.
Cabela’s launched their business via snail mail and catalogs. Today they are one of the largest sporting goods retailers on the web. Yet, they still send out catalogs—a lot of them. Their key is integration of online with the web.
J.C. Penney’s needs to drive as much traffic back to their brand as possible! If expenses can be managed on a targeted mail basis, then it’s a good option to test. Even better if they could innovate to make the print catalog tie in with an electronic version via a mobile app.
Are we now throwing stuff against the wall to see what sticks? If the catalogs had not been printed in over five years how many customers could/would be carrying them in the stores when they made a purchase? Did they seriously think the product at a 2009 price was still available?
There has to be a better, less expensive way to draw their customer base back. I am not the one to tell them what it is. But I can tell you when/if the catalog arrives at my house it will be looked at and discarded.
There is nothing more akin to today’s online business than catalogs. The original catalogs were for those who did not or could not go to the stores. Today online is essentially that catalog business.
But I as a customer am out of the catalog loop. Between my mailbox and my apartment is the recycle bin. The catalogs never get to the apartment. Why would they? Everything I need is online.
J.C. Penney used to have numerous catalogs, from uniforms to big-and-tall. When it comes to customer outreach, one size doesn’t fit all. Resurrecting this catalog may be a great idea.
A lot of things have changed since J.C. Penney discontinued its catalog five years ago.
When I think about the most successful catalogs, they are the ones targeted to a certain lifestyle and offer a very curated and editorial feel. J.C. Penney’s catalog was never like that and I doubt any attempt to mimic those efforts would appeal to the lapsed customer they are trying to woo back.
Additionally, many consumers use social media sites to drive inspiration or even go directly to the best online retailers that have perfected the blending of commerce and content. J.C. Penney is clearly not one of these.
J.C. Penney needs to determine how they will leverage this proposal. Nordstrom, Saks and Bloomingdale’s send small catalogs (I would call them booklets) to loyal customers throughout the year. Macy’s sends those annoying flyers every single week (which is overkill in my book but works for the majority of Macy’s customers). Penney’s needs to define their audience and determine how they prefer their communications—an old school catalog, streamlined lookbooks like Nordstrom, weekly mailers, or the inserts in the newspaper.
As I write this, of course, all of the retailers I’ve cited do an amazing job of communicating online, particularly Nordstrom and Macy’s who have amazing apps. I’m just wondering who J.C. Penney surveyed (if anyone) to determine the catalog idea. It’s not forward-thinking at all and wasteful from an environmental perspective. Here’s hoping they print that big thing on recycled paper.
It may be generational, but the catalog lets me browse at leisure through merchandise that I might be interested in. Many times I may not be thinking about purchasing products from the retailer but because I had the catalog in hand, it reminded me of something that I want to purchase.
There are many retailers that do much of their business online but use a catalog as the basis for keeping top-of-mind with their consumers. While the old “Big Book” may not be the right form, a catalog of some sort should work well.
E does not stand for everything.
The relationship is the print catalog provides ideas and inspiration that then leads to online and there is a lot of evidence that they work and are experiencing a revival.
Good move? For J.C. Penney, it depends on the content, the audience, the design, the experience—I bet it will work. Modern large-scale color printing (with great design) is a fantastic experience and this a worthy experiment but Mike needs to deliver more than a “C” performance.
Boy, I don’t know, the first thing I did with the Restoration Hardware encyclopedia they sent out was recycle it. Is this an indication of how old the J.C. Penney customers are? Not getting it and I’m a Boomer.
When searching through many choices or browsing, the “Big Book” can be useful. Determining how many are needed, who should receive them and how many sales are influenced by the “Big Book” will be essential to determine whether it is worth the cost. However, appealing to past loyal consumers, current loyal consumers and the potential consumers with one catalog will be tricky. Maybe that is why they need the book to be big.
A print catalog with emphasis on a strong web presence is the way to exploit the J.C. Penney brand nationally. That and expanding the product mix a bit. Think Harbor Freight. And Amazon can use the competition!
The success and or performance that catalogs bring to the retailer are largely predicated on a current mailing list that is largely comprised of participating membership. J.C. Penney is long departed from this venue and the likelihood of owning a customer list that will ensure success is very low. As for the consumer involvement in this era of e-commerce, my only interest is on what pages we will find the latest designs for beepers and buggy whips.
Bring it back for some niches, sure, because it works. But don’t replicate the “big book” of 50 years ago. (Although I fondly recall seeing a donkey for sale for $99 in the Sears catalog of about 1957 and begging my father to buy one for me, to no avail.) I don’t see print going away totally. I was told that 20 years or more ago, with “conventional wisdom” saying print magazines were not long for this world. I still edit and publish one, and it’s still very healthy.
“…some reaching 1,000 pages… (t)he 120-page revived catalog,”
There seems to be something missing from this effort…namely 900 or so pages; which is to say this seems more like a Sunday supplement than an actual catalog. But whether or not this represents a good compromise between back strain and having nothing, I’m assuming they’re hi-lighting the most popular items—I’m not sure.
Although it was a bit of a happy accident, Penney’s catalog infrastructure gave it a leg up in e-commerce many years ago, and it went on to become the first traditional retailer to hit one billion dollars in digital sales. Penney’s subsequent move to ditch its print catalogs marked an unfortunately literal take on the state of print media. Penney’s is wise to revisit the opportunity as catalogs take on new roles (facilitating digital sales and potentially building bridges to e-commerce purchases for traditional customers. Despite doomsday predictions to the contrary, catalogs and other print media are not dead, just different, and quite relevant in the digital age.
I think it’s worth a try. If home goods make up a large part of the catalog, it could help consumers consider J.C. Penney when planning big ticket purchases.
JCP is bringing back catalogs—why not? I am sure they will have a following, especially among seniors. Vinyl LPs are making a comeback, too.
H&M has a print catalog and outperforming their competitors who are going out of business. IKEA also has a print catalog and is a category leader. L.L.Bean is still in business because they have a print catalog. Victoria Secret and Avon anybody?
Print catalogs are relevant if presented in a upscale manner to customers and promote a lifestyle (L.L.Bean) around the product and service.