Catalog Printing: Creative Response to USPS Rate Increase

Necessity is the mother of invention, and sometimes a challenge breeds creativity.

Tonight on IndependentRetailer.Com I read a 10/30/13 article by Gloria Mellinger about the upcoming proposed postal rate increase and its effect on catalog printing services and direct marketers.

The article quotes Rep. Darrell Issa (R-Calif.) as saying, “The rate increase poses a direct threat to the 8 million private-sector jobs that are part of the mailing industry as businesses shift from paper-based to electronic communication and mailers are priced out of business.”

The Implications of the Postal Rate Hike

First of all, for Standard Flats (the class used to mail full-sized catalogs), the postage could rise as much as 10 to 12 percent on January 26, 2014. For me, this brings up a number of thoughts:

1. First of all, almost all of the articles I have read on contemporary marketing suggest that a coordinated effort involving both print and electronic media will draw far more customers than either print or electronic media alone, and these customers will spend more (based on market research).
2. I have read that print catalogs in particular drive potential customers to a retailer’s website and increase the overall amount spent.
3. The financial distress of the US Postal Service and the resulting rate increases will drive a lot of retailers away from print media, resulting in the loss of, or at least a reduction in, a lucrative marketing channel. Mailers may either reduce the frequency of print catalog mailings or cut them out altogether.
4. Not having a printed component of a marketing plan will exclude as potential clients anyone who cannot easily find a company’s website, does not know what the current vendor sales include, has an aggressive spam filter, is not computer savvy, or does not have a computer. Also, a print catalog will arrive in a prospect’s mailbox, encouraging her/him to page through the book, but a prospect must actively go to a website. (This reflects the active vs. passive nature of electronic vs. print marketing. It also shows how powerful the combination of the two can be.)

The Creative Response: The Mini Print Catalog

On a positive note, one interesting development in response to postage rate hikes has been the rise of the mini catalog format. These mail at the cost of a standard automated letter, cut production costs (when compared to a full-size print catalog), and yet allow mailers to keep the same mailing frequency and circulation numbers.

I did some research to determine the specifications of these mini catalogs and came up with the following:

1. One online printer notes that mini catalogs can be 6, 8, or 10 pages. (The 10-page limit is also borne out by the IndependentRetailer.Com article.) Although this is far less than a full-size catalog, it can keep a company in the awareness of a potential client by showcasing 50 to 70 products (according to B&W Press). In addition, a marketing manager may send a few complete catalogs to prospects or clients each year while also sending a number of mini catalogs to the same people at other times of year. It doesn’t have to be all or nothing, and a mailer will still save a lot of money, even within a climate of increasing postage costs.
2. The aforementioned offset printer offers a 10.5” x 5.875” option and a 11.5” x 5.875” option for a mini catalog. (This is a little like the “slim jim” format.)
3. This printer offers (and the US Postal Service has approved) fugitive glue adhesive to keep the mini catalogs closed during automated mail processing. This is a particular advantage since market research has shown that catalog readers hate wafer seals, which often tear the catalog pages when being removed. The fugitive glue will solve this problem.
4. Due to its having fewer pages than a full-size catalog, the mini catalog is ideal for driving clients to a retailer’s website for current pricing information, more product information, and/or to buy a product. Due to the lower postage costs, the mini catalog encourages the marriage of print channels (such as postcards) and electronic channels.
5. MultiChannelMerchant.Com (“Mini Catalogs Catching On As Economy and Culture Change,” 7/24/13, Del Williams) notes that a mailer “can cut mailing and production costs by a third” and “lower cost without lowering response rates.” The same article notes that “while mailing a full-sized catalog can cost 57 cents apiece at a million mailed, mailing these new mini catalogs can cost as little as 28 cents apiece at a similar volume.”
6. All of this means a direct mail marketer can maintain constant contact with prospects (using larger catalogs, mini catalogs, and electronic media), controlling costs while increasing reach and retention.