Is distributing to rural areas worth your catalogue spend?

A major retailer was undertaking a full catalogue optimisation initative, with a view to improving their turnover. Due to their remoteness and geographical spread, rural customers are a more expensive group to target from a catalogue cost per thousand distribution point of view. For this reason, the retailer wants to assess the whether their
distribution to rural areas might have been a little ‘undercooked’ in the past, as they sought to control costs.

The retailer recently printed and distributed an additional 18,000 copies of one of their catalogues to rural regions and it was Datamine’s job to assess the impact of this rural drop on sales, and market share in these areas.

Datamine looked at sales at this retailer prior to the promotion, as well as during the promotion period and compared these to the equivalent period last year, looking at number of transactions, their value and market share relative to their competitors.

Datamine were able to conclude that dropping the catalogue to rural households was hugely effective, despite the costs that can be a barrier. Against both
comparison periods, the rural households who received the catalogue spent more at this retailer. Some of this additional spend was taken from competitors, meaning our retailer saw gains in market share (of
10%), and some was money that wouldn’t otherwise have been spent in the sector.

The retailer was able to calculate ROI and see conclusively that dropping the extra catalogues to rural areas resulted in over $60,000 of incremental revenue, which more than offsets the costs involved in the initiative. The retailer now has the confidence to make changes to future catalogue distributions, based on actual evidence of its impact on customer behaviour. They are now another step
closer to a fully optimised catalogue strategy and Datamine will continue to monitor results moving forward too.