Internet-based catalogs

The time is right to jump online
Bob Landgren
For SBT
Spending significant time and money on the development and distribution of printed product catalogs?
Relying on a distribution network, a 24-hour-a-day 800-number contact center and your sales force out on the street to sell your products?
Need to rapidly increase the company’s profitability as a percentage of sales and improve your competitive position?
You’re not alone. Many companies are feeling the pressure to quickly create an additional sales channel via the Internet to meet and beat the competition.
Surf the Internet and you will find that the majority of Web sites today consist of “brochureware” – promotional material, financial information, distribution center locations and space for comments and queries. Only a few companies are successfully using their Web sites as additional sales channels to grow their businesses, strengthen customer relationships and become known as companies that are easy to do business with 24 hours a day, 7 days a week.
Those companies are feeling the benefits. The online catalog marketplace is booming. Internet-generated sales are expected to exceed $11 billion in revenue in 1999 – nearly doubled from $5.9 billion 1998 – and sales growth from 1999 to 2004 is projected at 50.2% each year. The necessity to conduct business over the Web is quickly escalating.
Statistics show that the emergence of Web shopping has resulted in 19% of consumers and 16% of business buyers purchasing less from print catalogs. The Internet is cannibalizing traditional sales channels. What is the reason for that? Online shoppers are siting convenience as the top benefit to shopping online versus traditional catalogs, followed by time savings, increased availability of product information and cost savings.
The Internet presents a huge opportunity for catalog companies. Everything from order-taking to customer service and consumer sales promotion can be made simpler, less expensive and more targeted by effectively using Web-based technology.
Online order taking: To have consumers place their catalog orders over the Internet translates into tremendous cost savings. In effect, by encouraging consumers to place orders online, the customer is doing the initial work for the company – essentially saving the cost of the telephone call and customer service representative.
Online customer service: The most immediate benefit to catalog companies, and most organizations with a clear customer service focus, is to provide customers and business partners with the option to service themselves via their corporate Web sites. Customer questions and problems can be instantly addressed through self-service. Online queries, Web call centers and chat rooms are all options that can be integrated into your Web site. Enable the consumer to merely enter his/her order number to check order status or input a product name/code and check for real-time stock availability – all without the intervention of a telephone representative. Customer self-service via the Web results in significant cost savings for your organization and it can actually improve customer service.
E-mail promotions and communications: The Internet enables you to improve the targeting and effectiveness of your customer communications and promotions. By compiling a customer e-mail database (along with advanced customer permission to send e-mails), you can send customized communications and promotional e-mails to your customers based on product preferences and interests. Such a targeted approach will improve the response rate, as well as provide customers with greater value and a personal touch. The cost is minimal compared to the cost of mailing a promotional piece.
A large majority of online catalog companies use e-mail to confirm online orders. That saves significant customer service phone time, while providing your customers with a reinforced acknowledgement that their order has been received and is being processed. You can also send periodic messages offering value-added tips or information.
The most profound impact of the Internet, for those companies that are prepared for it, will be attracting new customers to your business. In many cases, those will be consumers who have not been responsive to the catalog medium before. The impact on sales and profit can be phenomenal. As a matter of fact, in a recent study, nearly 25% of those companies with both online and paper catalogs report higher average orders online than from their print catalog. The study credits value-added Web site features such as “products of the month”, special discounts, premiums and unique interactive components with boosting electronic order size.
The key to successful online catalogs is to make sure that you are doing the same things, and more, on the Web that you are currently doing in your catalog. Have the right merchandise, at the right price, displayed in the most effective way. Provide a wide product assortment, keep the line fresh and have a good in-stock position. Survey your customers, listen to them and provide the same pleasant, satisfying and convenient shopping experience you’ve been providing in your catalogs. Pay special attention to the interactive components of your catalog Web site. Unlike your print catalog, you can capture and retain the attention of your customers by engaging them in interactive activities and creating personalized customer service. Develop and execute a well-defined marketing plan for your catalog Web site. Most important, make sure that your catalog Web site strategy is well-defined and is integrated into your goals and long-term vision for the company.
If you’re ready with a well-designed catalog Web site, there’s no better time to experience the huge sales and profit growth that the Internet is poised to provide. Bob Landgren is a partner in and branch manager of the Milwaukee branch of Whittman-Hart, Inc. Small Business Times readers can contact him via e-mail at bob.landgren@whittman-hart.com.