The catalog news coming out of the Brookstone Q2 conference call today, July 25, 2008 is that the company will be reducing its second half, 2008 catalog circulation by roughly 5% compared to the second half, 2007 volume. My experience has been that if you increase circulation and sales don’t go up, that’s not the result you were looking for.
Besides reduced circulation, catalog cost reductions will take the form of a decrease in weight (trim and pages) and an increase in product density (pages). Looking backward, direct marketing revenue was down 3.8% on a circulation increase of 23% for the prior 13 weeks and up 9.7% on a circulation increase of 37% for the 26 week period, both ending June 28. This, along with a lower average catalog order value, similar to the decrease in retail store AOV, and The Sharper Image going-out-of-business events, especially in malls where the two stores competed, resulted in a Q2 loss of ($8.6 million) compared to Q2 2007 loss of ($6.4 million).
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Comment by Cari Horne — November 12, 2008 @ 11:16 pm |