Sales & Marketing Management - Calling All Catalogs - December 1990

The Paperless Catalog - By Bristol Voss, Associate Editor

As an offshoot of the hi-tech revolution, many catalog producers have lately begun experimenting with things like on-line computer ordering, catalogs on diskette, and videotaped "brochures" that either replace or support existing printed materials.

On-line ordering, for example, is a function of the current trend toward "stockless inventories" and "just-in-time" delivery, with medical centers and hospitals being some of the earliest converts. By keeping just a 24-hour reserve on hand, for instance, the Vanderbilt Univ. Medical Center in Nashville, Tenn., which has a variety of vendors on-line, has slashed its inventories by about $2.8 million and cut operating costs by $270,000 annually (including the elimination of 27 supply related jobs). One immediate advantage: The facility transformed an 18,000-sq ft. warehouse, formerly used to house supplies, into a neurological center.

Computer diskettes are also gaining favor as an alternative to printed catalogs. In his former position as a salesman for Shaw Industries, Vic Cherubini, currently president of E.P.I.C. Software in The Woodlands, Texas, noticed more and more computers popping up on the desks of the corrosion engineers who were then his customers. Sensing a potential niche, he decided to create a floppy disk catalog of his 19 coating products. Rather than simply describing the products, however, Cherubini created a disk "catalog" that asked engineers a series of questions and formulated answers in the form of "pictures" of the product of the product along with technical data sheets. The result: E.P.I.C. now produces diskette catalogs for other industrial companies, growing from a gleam in the eye of a former salesman to an enterprise that chalked up $125,000 in sales during its first six months.

Aside from E.P.I.C., there are currently a number of companies that will transfer your catalog to a diskette, firms like TMI in Des Plaines, ILL.; CompuDoc in Edison N.J., Conerstones-Wright in Portland, Maine, and Show & Tell in Newton, Mass. Basically, here's what's involved: At a cost of roughly $5 per disk, the company will put together a "catalog," create master files, make copies and changes, and send them to remote locations (like Argentina, for example) via modem. For an additional charge, the computer can also be used to turn the static printed catalog into an interactive demonstration using animation and sound.

And while data on the success of on-line, or diskette catalogs isn't yet available, there are some statistics on the use of video catalogs. According to a study by the Wharton School of Business in Philadelphia, video brochures increase retention by approximately 50% over print advertising and help prospective buyers reach a decision 72% of the time.

With numbers like these, video catalogs are naturally getting some high marks from manufacturers. For example, Polymer Plastics Corp., a Mountain View, Cal.-based company that sells circuit-board products, has been sending out videos accompanying paper catalogs for the past two years. Why did Polymer pick video? Says CEO Larry Stock: "I figured customers were going to have to look at [the video]. I felt the curiosity alone was going to kill them."

According to Polymer Research, video catalogs generate 20 times the response of paper catalogs alone. What's more, sales have tripled since the new format was introduced.

Aside from the obvious visual advantages, videos also offer some unique uses compared with print catalogs: They tend to show off high-end items better and are also m ore well-suited to demonstrating very technical products. In addition, they can serve as a training tool for the sales force and a visual promotion for the distributor.

As far as costs are concerned, a five-to-seven minute video can be produced for anywhere from $5,000 - $35,000, with longer versions coming in at $100,000 and up. Once the original investment has been made, however, additional copies can be generated for as little as $5 apiece.

With this kind of technology innovation writing new chapters in the long and illustrious history of catalogs, their integral role in the selling process seems likely to continue, despite the potential pitfalls created by postal rate increases, corporate mailing policies and overzealous mail room clerks. Or, as Ed Burnett puts it: "Catalogs are proliferating. I don't see the numbers doing anything but going up."

If Burnett is right - and all indications are that he is - catalogs will be around for at least another 100 years, even though formats, functions, and delivery systems will evolve and expand just as they have ever since Mr. Sears and Mr. Roebuck began purveying their products via pen and paper back in 1886.