Hand in hand

There have been mutterings for some time that the proliferation of electronic catalogues now offered by the various players in our industry – wholesalers, dealers, contract stationers and mail-order operators among them – are rendering the printed catalogue somewhat redundant.
OPI‘s research reveals, however, that generalising statements of the kind that "the printed catalogue will be dead within five years" are extremely unlikely to come true.
What is fact is that strong adoption of the internet, and with it online ordering, has given consumers more confidence in the entire distance-selling concept. As ordering systems have become sophisticated, secure and reliable, customers are increasingly prepared to put their faith in those very systems and the companies behind them.
And nowhere is this more apparent than in the distance-selling categories, which have historically relied on the printed catalogue – the retail and mail-order distribution channels. According to EMOTA, a European trade association representing eCommerce and mail-order companies, on average 27 percent of retailers in the European Union (EU) sell goods to consumers through mail-order, with Austria (47 percent), Slovenia (46 percent) and Germany (41 percent) being the front runners.
EMOTA further reveals that 45 percent of total distance sales are generated through online catalogues and 30 percent by telephone orders.
But while nobody doubts that electronic ordering is on the increase, the mainstay of orders is still received offline, as mail-order giant Manutan International can confirm. France-based Manutan operates in 19 European countries, organised in five geographical areas. With revenues of €430 million ($590 million), it works purely on a B2B basis, catering mainly for large corporations, which require office supplies and/or industrial goods such as warehousing equipment (the ratio of its offering depends on the country).
Print preference
Ghislaine Duymelings, business development manager at Manutan, explains the strong focus placed on its printed catalogues, while at the same time acknowledging the gradual shift to online ordering. "At group level, our internet sales currently stand at 18 percent, but that average becomes quite different when you look at it in geographical terms. In terms of eCommerce, the Netherlands and Belgium are by far the most important countries, with online shopping accounting for over 30 percent of sales. In France, it’s about 14 or 15 percent, while in Germany, it’s 12 percent. And in Germany, an amazing 70 percent of all orders still come in by fax."
"We do get business that is generated purely through search engine marketing," she adds, "but the majority of what we do is through our print publications."
Of course, customer feedback is the only sure way of finding out the real importance of print publications. They may look online, but then place the order by phone, or alternatively browse through the print catalogue to then compare prices and order at the online shop.
Or, as Lyreco’s CEO Eric Bigeard points out, it could be a very different scenario altogether, particularly in the B2B sector: "We receive about 50 percent of orders in an electronic format, but it’s hard to say where the customer looked for the product in the first place. Most of our orders are repeat orders, so customers don’t look on the web or in the catalogue. And when they do want ‘new’ products, it really depends on computer literacy and just personal preference."
While a growing percentage of orders may be placed via electronic catalogues, the business is often driven through the print version. That’s certainly the case at a selection of US wholesalers.
Jack Reagan, president of Advantage Marketing Wholesalers (AMW), a group of regional US wholesalers, and senior VP of marketing and merchandising at ActionEmco (one of the wholesalers in the group), says: "ActionEmco participates with AMW and puts out for its dealers a full-line catalogue and more than 17 other publications each year. We do not have an online product, but provide our catalogue electronically to all the third-party software providers and any customer that would like it. So we may get over 80 percent of orders from our dealers electronically, but we believe that the printed catalogues are still driving the large majority of sales, even though the orders are being placed via the web."
Sabine Zwinscher, VP of direct marketing at Office Depot Europe (formerly branded as Viking), believes the question should not be about the importance of print versus electronic media. Instead it’s the combination of both that should be addressed. And here, we are clearly at different stages of development, geographically speaking.
She says: "The biggest change in Office Depot’s direct business has been the development of the internet as a new way to offer, sell, activate, inform and interact with the customer. In Europe, the web is still a new touch point to the customer, but we are seeing a lot of interactive behaviour from the catalogue to the web and the other way around. The issue is not one or the other but the intelligent combination of both. The only defining variable is customer profitability and lifetime value – whichever way the customer chooses to buy."
Speedy response
Zwinscher’s counterpart across the Atlantic, Kristin Micalizio, agrees: "In the US, usage of the internet is widely adopted as the primary method of ordering versus placing an order via a call centre. The dynamics and the model behind the web are very similar to the catalogue offering – only quicker!
"You are able to immediately see the reaction of customers and prospects, and adjust accordingly. You can target your audience and personalise your offers. The backbone of all activities is intelligent, actionable database management, and some of the pure web shops still haven’t discovered that yet."
Independent dealers haven’t historically been as tech-savvy as their big-box counterparts, especially outside the US. But there are some dealer groups that are more than happy to go down the digital road. One of these is UK-based Superstat.
Whether this particular channel is ready just yet for a full-blown digital explosion, however, is doubtful. Karly Haley, Superstat’s marketing director, says: "As far as Superstat is concerned, our printed catalogue is no more important to us than the digital version. In fact, the only reason we still print it is because at this stage both dealers and consumers demand it. The figures speak for themselves – 98 percent of our members take the printed version.
"For now, dealers that use both catalogues are having great success, particularly when it comes to prospecting because the digital version has a real ‘wow’ factor with clients. We are also having success with telesales as the catalogue can be sent by email and opened at the right page in seconds, thereby allowing dealers to close a sale there and then."
Haley concedes that for now, there is still a need for printed and digital publications, but she is quick to point out the advantages of moving towards digital solutions.
• Production and distribution costs are slashed and catalogues can be sent to millions of people without incurring additional cost
• Prices can be updated more frequently
• New products launched can be added immediately rather than having to wait for the next print run
• Seasonal promotions can be added giving additional exposure
• Customer-specific pricing is feasible
• Technical information and/or product demos and videos can be added
• Customers simply click the code to order
• It’s more environmentally friendly.
Virtual catalogue
A step up from the electronic catalogue or web shop is the virtual catalogue, where customers can ‘flick through’ a publication and effectively ‘turn the pages’. Office Depot has launched such a product in the US and while Micalizio admits that the revenue derived from this new medium is still relatively small, she expects this to grow in the coming years.
"Our virtual catalogue has created a wonderful opportunity to cost-effectively share our publication with any existing or potentially new customers. And if they want to buy an item, they can just click on the catalogue image and place an order."
Duymelings, meanwhile, acknowledges the growing importance of online shopping for Manutan’s customers. The company’s internet sales have increased by 40 percent over the past year – but it remains adamant that for this particular set of customers, the print catalogue remains vital.
 That said, she adds that two years ago, Manutan launched a new, purely web-based company, called ipsopresto.com. This company focuses mostly on office products (70-75 percent) and generates customer traffic through search engine marketing alone. Its differentiating factor is price, a great leveller and the raison d’être of many a web-based company.
Duymelings elaborates: "ipsopresto has been a great success and we have had some strong growth in this area. And unlike the various Manutan divisions, the target audience of ipsopresto is small companies with between five and 20 employees. It’s very price-driven and about 20 percent cheaper than Viking, JPG or JM Bruneau. For now, the company only exists in France, but the intention is to expand all over Europe."
One of the issues often raised and never quite answered is the financial implication of print catalogue production. For many OP firms, producing a print catalogue is a revenue driver and it’s clearly not in their interest to stop producing them.
In some markets, B2B operators reportedly make a handsome profit from catalogue production. Some companies charge their suppliers per page rates for appearing in their print (and electronic) catalogues, while others opt for general marketing contributions that not only go towards catalogue production, but also towards salesforce training and promotional activities. Either way, monies received often outweigh printing costs.
Multi-pronged approach
For the foreseeable future it seems the dominant trend will be a multi-pronged marketing and selling approach – through a printed or electronic catalogue, an eShop or a bricks-and-mortar facility.
But this might change as the next generation of OP buyers moves into the workplace, as Superstat’s Haley hopes: "These people will have been brought up on internet shopping and for them choosing and purchasing online is second nature. And, with the environment becoming more important, perhaps printing a catalogue in ten years will be as socially unacceptable as lighting a cigarette in the office."

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