Page Count Does Make a Difference

There are two main ways to grow a catalog business: one is to increase circulation; the other is to increase page count.

If your catalog weighs less than 3.3 ounces, increasing page count won't increase your postage cost. If your catalog weights more than 3.3 ounces, the incremental increase in postage will be marginal if you add additional pages.

Page count does make a difference when it comes to maximizing response rate. Any increase in page count (up to a point) will increase response, and therefore sales. In fact, sales will increase by approximately one-half the percent increase in page count. For example, a 20 percent increase in pages will increase sales by approximately 10 percent. Of course, this is a rule of thumb.

There's a favorable relationship between the incremental costs of adding pages vs. the actual return. Pages generate a high return on investment. For example, increasing page count from 52 pages to 60 pages yields a 15.4 percent increase in the number of square inches of selling space. Yet, typically the cost is only 7.4 percent more for the eight extra pages (again, this is approximate depending on the quantity printed).

Adding pages means maintaining the proper page density. It doesn't mean that you should devote more space to the items being added. Nor does it mean that you should give more space to existing products simply as a way to fill more pages. For the economics to work, proper density must be maintained as page count is increased. If you typically put eight items on a page, maintain that same product density. Simply put, the bigger the store (i.e., the catalog), the greater the sales. Often when pages are added there's a tendency to want to promote "the brand" vs. selling merchandise. Keep in mind that every page in the catalog except for the front cover should generate measureable sales and profits. Think of a catalog as a piece of real estate, where every square inch of selling space generates a direct return.

Don't reduce page count as a way to save money, especially if you're a piece-rate catalog (weighing under 3.3 ounces). This will have the opposite effect on what you're hoping to accomplish. The loss of sales and the gross profit dollars on those sales will be greater than any reduction in costs.

Adding pages is a smart, cost-effective growth strategy. I've always encouraged our clients to add pages as a way to grow. This assumes, however, that there's merchandise available to support the extra pages.

By all means, use square-inch analysis to validate page count changes. Use square-inch analysis to identify what items you should retain, drop or add to the catalog. In a properly merchandised catalog, the one-third, one-third, one-third rule will apply. This means that approximately one-third of the items will always be winners, one-third of the products will sell close to your square-inch break-even criteria, and one-third of the items will be losers. These items will need to be replaced with new products.

This means that even aside from the decision to add pages, about 30 percent of the products in a typical hard goods (i.e., gifts) catalog will be replaced each print cycle. If less than 30 percent of the pages lose money, consideration should be given to adding more pages. Add eight pages, do your square-inch analysis and determine if you should add another eight pages next time. Also keep in mind that if more than 30 percent of the pages lose money, you might want to give consideration to reducing the page count by eight pages.

It's a matter of proper balance and being careful that you don't have too many underperforming items as a percentage of the total number of unique products in the catalog. Pay particular attention to products that are being carried over to appear in the next book. Knowing when to drop a particular item is critical. Products that are repeated in a catalog will tend to have a revenue drop-off of approximately 20 percent each time. If the decrease is more than this, consideration should be given to replacing the item.

The number of merchandise offers (as opposed to the number of SKUs) in a catalog is what drives revenue. An offer is defined as a product. A SKU could be a different color, size, etc. Again, look at offers, not items. I like to see a minimum of 250 (300 is even better) different offers in a catalog.

Catalog companies that can grow by increasing page count and circulation at the same time are in a win-win situation. Don't depend entirely on circulation increases to grow your brand. Consider increasing page count as another tool in your marketing toolbox.