Auntie's Beads Knits a Catalog

Ron Henderson came reluctantly to using a print catalog to generate additional sales from new customers after focusing at first on the Web as a sales channel.

The president of Auntie's Beads, Grapevine, TX, started with 2 1/2 years ago. The 20-employee company began making its 12-page catalog available to requesters only eight months ago, printing 10,000 copies, of which 4,000 have been mailed. The book has produced more than 600 online orders.

“Generating long-term customers who place multiple orders is the goal of the catalog,” Henderson said. “We want them to be able to buy from one place, and we want to be their primary source.”

He has seen no resistance to the $1 charge for the catalog, a price lowered from the original $3 about two months ago.

“We considered not charging for it, but it's kind of a screening mechanism to make sure someone is interested in the products,” he said. “It's a highly interested customer that will pay $3 for the catalog. Printing a catalog has definitely been worth it, and it's something we'll want to refresh at some point in order to have a more complete representation of what's on the Web.

“We lowered the cost because we wanted to make it easier for those people who might have an issue with spending $3. [We also had to consider] the inventory of catalogs becoming obsolete at some point.”

The $1 charge is added to the shopping cart at checkout, or requesters are charged the amount if they don't order products from the catalog.

“We initially didn't want to do one at all and wanted to be strictly Web based,” Henderson said, “but the customer demand was such that enough people wanted to have a catalog in their hands and carry it around with them. When it came out it had everything we offered, but now it's only a small subset of everything we have online. At some point we might do an updated version and maybe double the size of it.

“The strategy is to be highly targeted, and we're going to distribute to requesters only at this point. We target a very specialized market, a subset of the craft industry — people searching for jewelry-making supplies, with people making their own jewelry representing a growing consumer market. The print catalog contains components to make beads, necklaces or bracelets. These are real niche products.”

The bottom-right corner of the book provides an incentive for the jewelry-making enthusiasts: $10 off a first online order with a $40 minimum. The cover offer sought to produce “a higher conversion rate and make people realize how easy it is to order online,” Henderson said. “Most of them will make repeat orders, increasing the profitability of the catalog.”

Though Henderson typically sees an average order of $60 to $70, he's pleased with the $40 to $50 range produced by those ordering online through the catalog.

“It's what I would expect, and once they use that coupon, I expect them to come back and place a larger order,” he said. “Given the catalog's success, I wouldn't rule out at some point doing a mass mailing.”

Per-piece production of the catalog costs $1 to $2, Henderson said. A three-page sheet with price changes and corrections started going out with the catalogs about two months ago.

The customer base is 99 percent female. The Midwest is the strongest market, with Florida also accounting for a significant percentage of sales. Henderson said his retail store in Grapevine produces about 10 percent of his company's overall sales while “very little” is generated via its toll-free number. The majority is produced via the Web.

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