Catalog Inserts Offset Rising Costs

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With the ongoing quest for new names and catalogers continuing to seek ways to offset rising costs to get in the mail, inserts are gaining in popularity. This "quiet media" has grown out of adolescence and reached adult status as a viable opportunity for the direct marketing community.

A history lesson. Inserts were used by a few direct marketers as early as the mid-1970s. Garden Way, manufacturer of the Troy-Bilt Tiller and other outdoor gardening equipment, placed bind-in cards in many mail-order gardening catalogs.

Having an obvious affinity with this segment of the marketplace, this media worked well for the high-dollar two-step marketer. It got even greater results when it "personalized" the copy into various catalogs. It used a star burst, "the tiller used by Wil Jung" in Jung Seed Companies spring catalog, producing an increase in upfront inquiry response and overall conversion rates.

Catalog inserts grew during the 1980s but still were not well-recognized as a viable vehicle and circulation was limited. Advertisers seeking specific demographic profiles often needed to approach potential catalogers directly or via a broker to obtain permission to insert into a specific catalog that prior to this time had no specific program.

Most advertisers testing this media segment had been successful in package inserts and were looking for greater circulation numbers. Magazines have used business reply cards for years, and several tested cards in catalogs for subscription offers with limited success. But then came the bank cards, collectibles and check companies. As more advertisers began testing this media, the pieces grew more complex. Many longtime package insert advertisers wanted to use the same creative piece as an insert in catalogs.

Two factors need to work in the overall equation: physical insertability by the cataloger's printer and the effect the piece has on the overall weight of the catalog. A typical BRC (3.5 by 5.5 inches) costs the cataloger slightly more than $2 per thousand if they mail in the pound rate. Larger and heavier inserts, while possible to insert at the bindery, may become prohibitive because ofincreased postage costs. When planning a campaign using catalog inserts, one must keep these factors in mind.

With more and more advertisers finding successful programs and with catalogers understanding the potential of a new revenue stream, programs began emerging in the 1980s and for years to follow.

The 1990s and into the new millennium. By this time, a much wider selection of catalog insert programs are on the market, with more advertisers participating. The book and record clubs have been involved, continuity offers like Gevalia Kaffe and solo products (Oreck) as well as insurance offers (Geico) have been regular advertisers.

There are a few managers who specialize in alternative media management and brokerage (including catalog inserts) as well as several other list managers that now have an alternative media division.

As of June, as many as 214 individual catalog insert programs are on the market providing nearly 2 billion annual circulation reaching many demographic facets of the DM industry.

What makes them so good?

· Advertisers can reach large circulation while the catalogers gain a revenue stream. Some catalogers gain more revenue from inserts than they do from list rental.

· Advertisers can reach demographically targeted audiences.

· Pricing is reasonable.

· Inserts have high visibility because catalogs open naturally to inserts, creating a "page break" similar to the effect of your order form.

· Quick response. Catalog inserts usually are sent in just one mailing that reaches all catalog customers in a short time, unlike a package insert that may take weeks or months to fulfill.

· Catalogers can use inserts to promote their own offer ... "Send a friend a catalog," "Special sale items," "Drive traffic to your retail locations."

A peek into the future. As demand continues to grow for more circulation and as catalogers continue to open their eyes to the potential revenue, program availability will keep growing. In addition to the traditional direct response advertisers that have continued using this media in recent years, several general advertisers are looking at these vehicles (with large distribution) as a way to expose their brands and drive consumers to test new products.

Many catalogers have been skeptical, concerned with what their customers might think of an outside advertiser taking up space in their book. Having worked with this media since the late 1970s, I have not known one cataloger (no matter how reluctant at first glance) that has turned back for this reason. However, being in an industry that is known for testing, I would suggest a simple A/B test to measure any feedback you may receive.


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