The Power of Licensing #6: Amazon Looks Back To The Future With A Retail Catalog

July 31, 2018 | By: Michael Stone, Co-founder and Chairman, Beanstalk

William Faulkner famously wrote, “The past is never dead. It’s not even past.” I frequently think about that line (it’s from Requiem for a Nun) from a marketing and communications perspective (I doubt that was Faulkner’s intention). As I have noted many times, when considering brand messaging and engagement, history matters. As I observe the many fronts of the “shopping battlefield” and the continuous blending of online and brick-and-mortar (offline) retail, I am struck by how history repeats itself. We think that we are living in a unique age of retail change and, surely, we are witnessing great and accelerating change in how, where and when we buy goods. Retailers of all stripes are working hard at adapting to this new landscape, trying to figure out the most effective ways to reach their consumers with their brand message and their products. We have winners, and we have losers. But sometimes, a strategy that we thought was old and tired, actually becomes new again. This is a theme to which I find myself continuing to return. Let me provide a recent example that was in the news.

As Toys ‘R' Us completely disappears, former competitors are aggressively looking for ways to grab some of those sales and some of that market share the giant retailer has now abandoned -- $6.5 billion in sales last year, almost 20% market share. Target and Walmart are making more room on their shelves for toys. KB Toys, once the nation’s second toy retailer with 1,300 stores at its height, went out of business in 2009. The owner of the IP has announced 1,000 pop-ups for holiday 2018. And what is the great retail disruptor -- Amazon -- doing to capture some of that share? Of course, there will be more toys offered on its site. That’s been happening for years (including a now-defunct association with TRU). But Amazon is going a step further. The e-commerce juggernaut is launching a holiday catalog, according to a recent report in Bloomberg(July 4, 2018). Yes, an ink-on-paper, fully bound catalog that you will either get in the mail (as in delivered by the U.S. Post Office to your home mailbox) or stuffed in your bag at your local Whole Foods store (conveniently owned by Amazon). Amazon is following in the footsteps of the failed TRU -- remember the TRU “Big Book,” a 100-page catalog filled with toys mailed every October and, in many ways, launching the holiday toy selling season each year? Amazon is using a marketing and selling tool of yesteryear.

Catalogs have actually never died as a selling tool or a way of reaching and engaging consumers. Although the number of printed catalogs in the United States today is less than half of what it was at its peak in 2007 (then almost 20 billion catalogs), many retailers still see catalogs as a way to get attention, tell a story, inspire consumers, fill a gap with a unique selling proposition, as well as a way to cut through digital fatigue. Certainly many of today’s catalogs are more sophisticated and creative than those of the past. Sometimes, for example, there is more “story” than there are products for sale. Consumers often want something to touch, a physical object to peruse at their leisure. According to research conducted by the U.S. Postal Service, consumers are paying more attention to catalogs today than in the recent past. Oftentimes, the catalog drives online sales.

While retailers continue to improve and upgrade their online presence, they are also going in other, more traditional, directions as well. Consider catalogs coming from Neiman Marcus, Anthropologie, Brookstone, Wayfair, IKEA, Patagonia, RH, Crate & Barrel and, my all-time favorite, L.L.Bean, among others. Of course, catalogs hit a nostalgic chord in all of us. They remind of bygone days that we recall as simpler times. However, if it was just tapping into nostalgia it would be quaint. But it’s much more than that. It’s smart marketing, all part of an omnichannel strategy to reach consumers where, when and how they shop, to retain existing consumers and to recruit new ones. I think that we can all agree that Amazon is not about being quaint.

Catalogs are a nod to the past (back to Faulkner). Mail-order catalogs revolutionized shopping behavior in the 19th century. The expansion of the railway system and the growing postal system in the mid-1800s led to the mail-order catalog with more choices and convenience than most American consumers had ever experienced (sounds a bit like e-commerce, doesn’t it?). Instead of traveling to the only general store in town (by wagon) and choosing mostly necessities from a limited offering, consumers could now flip through pages of numerous products, mail in an order and wait for the delivery. The first “catalog” in the United States was Tiffany’s Blue Book in 1845. Hammacher Schlemmer introduced its catalog in 1848. Montgomery Ward published its first catalog in 1872, which grew from a single sheet of paper to over 540 pages featuring 20,000 items. And in 1888, the Sears catalog was launched and grew to 532 pages in seven years, offering sewing machines to, eventually, automobiles. The mail-order catalog changed retail forever, changed consumer shopping behavior, and compelled brick-and-mortar retailers to adapt. And, in our time, Amazon (essentially a Web-based mail-order catalog) upended retail in a similar fashion, disrupting how consumers shop and forcing retailers to adapt.

Now, Amazon returns to its true roots -- the mail-order catalog. It’s time to go back to the future with an Amazon toy catalog coming to your mailboxes this coming holiday season. History matters.