Holsted Tests a Return to Catalogs

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Holsted Marketing Inc., a marketer of jewelry and gifts to women ages 35-60 via solo direct mail and statement inserts, tests its first catalog in nine years this month.

The book, Holsted Jewelers, mails March 10. If all goes well, the company will have another mailing in the fall with a probable circulation increase of 25 percent to 50 percent. The company expects to have three mailings next year.

"Over the last four or five years, our capability in sourcing product and the economic cost structure [have] improved dramatically where creating a catalog is viable," said Victor N. Benson, president/CEO of Holsted Marketing, New York. "Four or five years ago, most of our product was manufactured domestically. Now it's manufactured in Thailand, Hong Kong and China. [This] allows us to do a catalog and allows the margins in the catalog to be significantly improved."

The company currently uses space ads for jewelry promotions and is creating a Holsted Jewelers Web site that will run along with the catalog. The site is in test mode with plans to roll it out in the next two months.

"We think it will complement the existing business since it's a completely different media," Benson said. "Once we have it up and running, we expect to work with and talk to our clients, a number of whom have expressed an interest in having it test-mailed to their customers."

This month's mailing has 170,000 recipients. About 40,000 of the 50,000 names in the house file will receive it with the rest going to prospects. Prospects were obtained from roughly a dozen lists. Recipients include direct mail buyers of jewelry, general merchandise and gifts.

"[The] focus [is] on Middle America, 35- [to] 60-year-old female buyers [with average annual household] income between $30,000 and $75,000," Benson said.

The 64-page book is a 5.5-by-8.5-inch, digest-size publication. It has 560 SKUs with price points from under $20 to over $200. The average price of items is about $35.

"We needed at least 500 SKUs in order to get enough of a breadth of offering to see what the customer is really interested in," he said.

Items were described as low-end, fashion merchandise and fine gold. The anticipated average order is $60 to $65. Benson expects a response rate of 1 percent to 1.5 percent for prospects, with the house file generating 30 percent to 40 percent better response.

Initial sales channels include phone, fax and mailed-in order forms with the Web site added later.

Two covers were tested: One with a model that went to three-quarters of recipients, and the other featuring a tulip that will reach one-quarter of the audience.

"[We did that] to determine which would have more appeal in the marketplace," Benson said.


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