Canada Post gets seriously into the catalogue business

If you've been thinking about ramping up your marketing efforts by getting into catalogues, but are afraid of the cost and risk, you may want to pay attention to the multi-merchant catalogue Canada Post will be testing this fall. It will be about 24 pages and feature double-page-spreads from 10-15 merchants, ranging from home and garden to apparel to travel. The only confirmed merchant as of today is Ottawa-based kitchen accessories retailer Ashton Green.

David Coulson, acting director, retail and catalogue marketing at Canada Post says that the concept is similar to the American in-flight catalogue SkyMall. He adds that the biggest draw for merchants is Canada Post's use of its own proprietary prospecting tool SnapShot, which will allow the catalogues to be highly targeted.

"We've invested quite heavily in SnapShot. It predicts a propensity to purchase," explains Coulson. It was developed for Canada Post using 13,000 different variables, and it's capable of clustering analysis and producing detailed profiles based on purchase behaviour.

About four years ago, Canada Post identified that there was a problem growing the direct mail industry in Canada, and decided to focus on how to improve that to help grow its own business. "Canada has been a lot behind. We see a phenomenal growth opportunity," says Coulson, adding that the direct mail markets in the U.S. and U.K. have been growing exponentially, and that Canada Post is focusing on stimulating similar results up here with tools like SnapShot and the multi-merchant catalogue.

The test catalogue is set to come out this fall and land in 500,000 households and 200,000 email inboxes. It offers three different pricing models for a double-page-spread: a flat fee of $59,000; a risk-share fee-per-buyer of $56 per buyer (so if you don't get a response, you don't pay anything); and a mixed model with a $29,000 flat fee plus $28 per buyer.

If the test is successful, Canada Post will make the multi-merchant catalogues a regular feature, with likely four or more issues per year at a beefier 100+ pages.