Discovery Finds Shift From Prospects Boosts Order Size
"We cut out a lot of prospecting due to the macroeconomic climate in addition to the fact that we are transitioning our merchandise," said Tom Burke, senior vice president, marketing and e-commerce, at Discovery Consumer Products, Bethesda, MD. "We felt the best thing to do was to be conservative."
Discovery sent 1.4 million catalogs over three drops this year, down from 4.5 million over three drops last year. Prospects accounted for 60 percent of the 2000 holiday mailing but about 10 percent this year. The page count dipped to 36, from 84 last year.
An emphasis on more expensive items also contributed to the rise in order amount from $78 last year to $85 this year.
"With the reduced number of items, we focused on the high-priced items and eliminated some of the lower-priced items," Burke said. "The $85 average order is what we expected. Also, we were looking for a 2.5 percent response rate this year, and we're on track for that. The response rate was below 2 percent last year."
Catalogs reached homes from late October through November, a shorter period than last year when the first drop went in September.
"We tightened up the time frame this year because we wanted to maximize our sales and not stretch things out," Burke said. "We thought our customers wouldn't be buying early this year, and we wanted to concentrate our efforts on the peak period."
The first drop was Oct. 23 to 600,000 recipients, 90 percent of whom were prior catalog and e-commerce customers from the house file. The rest went to prospects identified as catalog and e-commerce shoppers.
A second drop of 600,000 went Nov. 10. Ninety percent were to Passport loyalty program members, many of whom are retail customers. The rest went to prospects, focusing on consumers living within five to 10 miles of Discovery Channel stores and showing a high incidence of catalog and Internet shopping.
The final drop of 200,000 was in homes the week of Nov. 26. It went to 0-month to 6-month multi-buyers from the company's e-commerce and catalog house file who spent more than $100 in recent purchases.
"The portion of the house file that received the [first two] books is a little broader," Burke said. "For [those] we included 0-[month] to 12-[month], or in some cases 18-month, buyers. We mailed to everyone in the 0- to 12-month portion of the house file, and beyond 12 months we mailed to those whose latest purchase was at least $75 or $100."
The transition of Discovery's products involves aligning them more closely with the Discovery Channel brand.
"This year we focused on just our core items and a new merchandise mix," Burke said. "The execution in this area wasn't as strong last year.
"This year our catalog is utilized more as a drive to retail and our online channel, and we felt the best way to accomplish that would be to mail the house file and do very little prospecting."
This year's biggest sellers include the Meade DS-2114ATS telescope ($399), the Egyptian Cat Throw ($59), Giraffe Print ($68), Flight Simulator ($30), B.I.O. Bugs ($40, or $149 for the set of four) as well as items from DiscoveryStore.com's e-gallery.
Burke said 70 percent of catalog buyers are female while purchasers' average household income is $75,000 or more, with the majority being college graduates with children in the household.