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E-Retail’s Secret Weapon: Print Catalogs

Wednesday, 20 Dec 2006 | 3:56 PM ET

Rumors of catalogs’ death have been greatly exaggerated.

CNBC’s Margaret Brennan reports that printed catalogs are sticky.

And Scott Silverman agrees, the executive director of e-commerce retailers' association Shop.org, told “Power Lunch” that brick retailers with a strong online presence are spending more on catalogs than ever before, as the new-and-old economy combination wins over consumers.

Retail Catalog Boom
The Internet was thought to have diminished the importance of retail catalogs, but catalogs were found to be the most successful tool for increasing revenue this year, according to a new survey. Margaret Brennan, CNBC Retail Reporter, and Sue Herera have the details.

Two prominent New York City retailers reinforced that view: Michael Gould, chairman and CEO of Federated Department Stores-owned Bloomingdale’s chain, said multi-channel shoppers – i.e., consumers browsing and buying via various media and outlets – are six times more likely to make purchases than single-channel shoppers. Brennan noted that Edward Schmults, the CEO of FAO Schwarz, told her that 40% of the posh toyshop’s sales are online – and he’s planning on issuing a paper catalog to support the privately-owned firm's Web presence.

That’s a cost-effective strategy that makes sense for real and virtual stores alike: Brennan pointed to a study by the Direct Marketing Association, which compared estimated 2006 catalog expenditures of $20 billion leading to a sales payoff of $144.2 billion, with TV ad expenditures of $21.7 billion reaping sales of $150.8 billion.

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