American distance selling players have a smile

American distance selling players have a smile. The new increase, next year of 7 of postal rates may weigh on the margins of these giants distributing millions of catalogs every year, but the boom of the Internet allows the sector to display since ten years growth in double digits. By combining sales through catalogues, electronic sites and TV channels, the turnover of the sector increased from 52 billion in 1995 to 161.5 billion ten years later. Even if it is going to slow, the growth rate could still reach the 15 next year, what do salivate many traditional distributors face a less dynamic business environment.

"All segments confused and taking into account the indirect effects, Editor's note, distance selling represents for the first time since last year more than 10 of U.S. gross domestic product", calculates Charles Prescott, the Direct Marketing Association. The medal has its setbacks. The growth of the sector is confirming, actors seek to develop a multi-channel strategy and develop in distance selling. Finally everyone at home: the véadistes launch on the Internet or in shops in hard, the traditional chains diversify on the Net or in catalogues and the rare "pure players" who were able to install, such as the Amazon GP or the "category killers" Zappos (shoes), Drugstore (drugstore), come play the spoiler. "Today 83 of our members are multichannel and are present both in the shop, on the Internet and in the catalogues", note the head of the DMA. The atomization of the US market is undoubtedly the main structural difference with the situation in France.

Thematic offers

The heavy weight and historical actors in the catalogue as JC Penney and Sears, who have since long also developed a physical presence, are now figure of exception. Groups such as Crate & Barrel (furniture), Williams & Sonoma (kitchen) born catalogues are now, and conversely, Victoria's Secret (lingerie) took advantage of the development of its presence on the Web to enrich its offer by proposing for example clothes that are not sold in the store. "There was no cannibalization but instead synergies between the different forms of distribution", notes Tobias Cacéres economic mission in New York which will publish early next year a study called "how to use distance selling in the United States."

The emergence of the Internet has accelerated a transformation which was already initiated in the early 90s. The rise of hypermarkets (Wal-Mart, Target...) and large specialty channels (Home Depot...) in fact pushed into first American pioneers of the VAD is questioning. To deal with the emergence of rivals terribly aggressive to the tariff level but also to specialists creating very sharp catalogues (watches, toys...), the Sears and other JC Penney have also focused on the purchases of products in countries with low-cost labour and abandoned their "big books" to develop a range of thematic catalogues (cashflow classes)(, gardening, pets...).

"Market soon 300 million inhabitants, niche brands can indeed prove to be viable," explains Eric Faintreny, Chairman of Redcats USA, a leader in distance selling of clothing with a strong presence on the Web. On paper media, the cost of unit shipment being lower than for a large catalog, send frequent catalogs allows bonus "relaunch" more often clients. "The different forms of distribution are complementary." "Experience shows even that consumers from buying on Web sites in a paper catalog having first consulted can spend up to 40 more", says Charles Prescott. The results are in all cases the appointment for the players passing their adaptation. JC Penney, which saw its turnover Ironing Board in 2002 and 2003 below its level of 2001, has since returned to the path of growth. Direct sales, which fell more than 20 at the beginning of the century, are distributed on the rise and the Group's Web site has generated last year more than 1 billion in sales.