Catalog sales will reach $120 billion this year, an 8.9% increase over 2000 sales of $110.2 billion. In comparison, overall retail sales are projected to grow from $3.2 trillion in 2000 to $3.3 trillion in 2001, a 3.1% increase, according to a study by the Direct Marketing Association.
Catalog sales over the next five years are expected to grow at about 6%. Consumer catalog spending will jump from $67 billion this year to a projected $78 billion by 2006. Business-to-business spending will hit $43 billion this year and increase to $50 billion in five years, the study found.
“Although some individual companies are experiencing difficulty, the catalog industry continues to grow at a healthy pace,” DMA president H. Robert Wientzen said in a statement. “This is consistent with the traditional performance of catalogs and other types of direct marketing, which, because of their efficiency, tend to do well even in times of economic uncertainty.”
During a press briefing on the study yesterday, Jules Silvert, executive vice president of Brylane, noted that despite the challenges presented by a recessionary environment, “There are tremendous opportunities out there” for catalogers looking to expand their product offerings and distribution channels. He cited the growth of his own company’s Brylane Home catalog as an example, as well as Black Box, J. Jill and Coldwater Creek. “They weren’t even on the radar a few years ago.”
George Ittner, CEO of Newport News said establishing a private label credit card has been great boon to his catalog, noting the value of Newport News credit card holding customers is much higher than other segments.
The study also found that while Internet sales are slowing from triple-digit growth, the World Wide Web remains the fastest growing direct marketing medium. Sales generated on the Internet are projected to reach $37.1 billion this year, an increase of 32% over 2000 sales of $28 billion.
A 37% growth rate is predicted for interactive sales over the next five years. Consumers are expected to spend $10 billion online this year compared to close to $23 billion in 2006. B-to-B online spending will reach $18 billion this year, and $39 billion in five years, the study found.
Total direct and interactive marketing sales in the U.S. exceeded $1.7 trillion in 2000.