A half-decade after killing off its hefty catalog to focus on the Web, J.C. Penney Co. is bringing it back, armed with data showing that many of its online sales came from shoppers inspired by what they saw in print.
The new, 120-page book will feature items from Penney’s home department and will be sent to select customers in March, the first time the struggling department store chain has sent out a catalog since 2010.
The move highlights an oddity of the digital age. While shoppers are increasingly buying everything from shoes to sofas to cars over the Internet, they still like browsing through the decidedly low-tech artifacts of page and ink.
Catalog mailings are down considerably from 2007, when they peaked at 19.6 billion, according to the Direct Marketing Association. But in a sign the decline may have bottomed out, mailings grew in 2013 for the first time in six years to 11.9 billion.
The call to bring back the catalog was made by Chief Executive Myron “Mike” Ullman, who is trying to return the retailer to health after a disastrous overhaul under former Apple Inc. executive Ron Johnson.
It also was Mr. Ullman who decided during his first turn as Penney’s chief to stop publishing it. In an interview, he said he thought at the time that catalog shoppers would migrate online. But the company eventually learned that a lot of what they thought were online sales were actually catalog shoppers using the website to place their orders.
“We lost a lot of customers,” Mr. Ullman said.
Penney launched its catalog in 1963 and enthusiastically embraced the medium. The company published three “Big Books” each year, some topping 1,000 pages, and supplemented them with dozens of smaller catalogs dedicated to niche areas such as school uniforms, kitchen products and window coverings. After Sears stopped publishing its main catalog in 1993, Penney was left as one of the largest catalog retailers in the country.
The Internet then took its toll, as did the recession. Catalogs can be expensive to produce and distribute, making them a target for cost cutters. They can also be annoying. Some 44% of consumers say they want to get fewer of them in the mail, according to retail consultancy Kurt Salmon. Penney stopped mailing the Big Book in 2009 and phased out distribution of 70 smaller catalogs a year later.
Now, retailers are rediscovering the books as a branding tool that can drive sales. According to Kurt Salmon, 31% of shoppers have a catalog with them when they make an online purchase.
J. Crew Group Inc., Williams-Sonoma Inc., Bloomingdale’s, and Saks Fifth Avenue are ardent mailers. Even retailers grounded in the digital world are taking part. Bonobos, a men’s retailer with roots in the Web, mailed its first catalog in March 2013.
“At the time, everyone said digital was the future and catalogs were old time,” said Craig Elbert, Bonobos’s vice president of marketing. “We found that the catalog allowed us to tell a fuller narrative about the brand and our products in a way that we were struggling to do online.”
The catalog delivered another benefit: It ferreted out its best customers.
“Our catalog customers tend to spend more,” Mr. Elbert said. “And our catalog customers who make purchases at our brick-and-mortar stores are our best customers overall.”
Bonobos plans to mail 10 catalogs in 2015, up from eight last year.
The catalog format has changed from the old-style yearbook of products into lifestyle magazines that allow retailers to showcase their wares and build their brands. A case in point: The books that Restoration Hardware Holdings Inc. mailed to customers this spring featuring glossy interiors and profiles of designers and craftsman.
The mailing was also a reminder that retailers can go too far. Restoration Hardware’s direct-mail onslaught included 13 different catalogs–as thick as a phone book in total and spanning a cumulative 3,300 pages–overwhelming shoppers’ mailboxes and spawning a Facebook page devoted to stopping the mailings.
Restoration Hardware declined to comment.
Penney hasn’t yet reported fourth-quarter results, but earlier this month it said a better-than-expected holiday meant sales growth should come in at the high end of a forecast range of 2% to 4% from a year ago. The company continues to claw its way back from the devastating sales decline that followed Mr. Johnson’s experiments in marketing and merchandising. Sales in Penny’s last full year, ended Feb.1, 2014, totaled $11.86 billion. By comparison, they totaled $17.76 billion for the fiscal year ended Jan. 29, 2011.
Home goods have historically been among the top selling items in Penney’s catalogs–one reason Penney is dedicating its new catalog to that area. Another reason is that the home category accounts for 40% of online sales.
Rather than blanketing America with the new books, Penney plans a targeted mailing of its former home shoppers.
“We are trying to get back those lapsed customers,” Mr. Ullman said.
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