Iraq War Continues Slump for Catalogers

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The U.S.-Iraq war hurt catalog sales, according to Abacus' Spring 2003 Catalog Industry Trend Report, which also revealed an overall decline in catalog sales last year.

The war produced major fluctuations, as performance had stayed steady in late January and even improved the next month. However, when air strikes on Iraq began in March, performance plummeted 65 percent from the average experienced in preceding weeks -- possibly due to the public's attention being focused on the war or from consumer fears of the war's economic impact. When U.S. forces entered Baghdad and the war's end was in sight, performance essentially returned to pre-war levels, rising 61 percent.

Also reported was that catalog sales fell 1.5 percent last year, driven by a drop in the number of households making catalog purchases. Overall, 800,000 fewer households bought from a catalog last year compared with 2001, down 1.6 percent.

But some categories produced growth in purchases, including tools (12 percent); electronics (8 percent); the senior market (6 percent); home decor (4 percent); and gifts (3 percent). Categories experiencing declines in sales included apparel and accessories (3 percent); and children's products (3 percent).

Despite the falloff, apparel and accessories remained the largest overall category with $6 billion in sales last year, followed by home decor with $2.8 billion.

For marketers with catalog and online sales channels, online sales continued to increase, reaching 33 percent of total sales in the fourth quarter last year. Online sales rose from 24 percent of total direct sales in 2001 to 30 percent last year. The channel shift was particularly noticeable during the holidays. From Dec. 10-23, 39 percent of sales took place online, reaching 50 percent from Dec. 24-30.

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