I want to point out the impact of promotions on response rates. Promotions such as free shipping, a dollar amount or percentage off the order, etc., have become commonplace because these offers increase response rates if structured properly. If your competition has an offer and you don't, it can hurt your response rate.
There continues to be a growing shift from ordering via an 800 number to buying online. Therefore, some of the declining response rate is actually a decline in order tracking. Even with a matchback process in place, you might miss tracking sales to the catalogs that are actually driving the orders. The response rate decline you're seeing might not be as severe as you think.
Be sure to do your homework before you decide to take action that could accelerate declining response rates. Adding pages, using promotions or finding a spot in your circulation plan to add an extra drop to your housefile are a few things to consider to reverse the trend.