Doing More With Less: Catalog Industry Increases Efficiency

SAN FRANCISCO, June 1, 2003 – The catalog industry is growing more efficient and productive, according to a study released by the Direct Marketing Association (The DMA) at the 20th Annual Catalog Conference & Exhibition in San Francisco.

Catalog sales increased an average of 9.24 percent each year between 1998 and 2003, according to The DMA study, Economic Impact: U.S. Direct and Interactive Marketing Today. During the same five-year period, catalog ad spending grew 6.25 percent annually, and industry employment grew only 3.71 percent per year.

The DMA projects that catalog sales will reach $132.8 billion in 2003, a 5.6 percent increase over 2002 sales of $125.8 billion.

"Although the growth of catalog sales has slowed in this uncertain economy, catalog companies are doing more with less. Growing customer acceptance of the Internet and catalogers' expertise in delivering superior customer service online are helping to improve the productivity of the industry," said H. Robert Wientzen, president and CEO, The DMA.

U.S. Catalog Sales ($ in billions)*

	1998	2002	2003	2004	2008	CAGR 1998-2003**	CAGR 2003-2008
Total	85.4	125.8	132.8	141.9	176.7	9.24	5.88
Consumer	52.3	76.9	81.2	86.7	108.0	9.21	5.86
Business	33.0	48.9	51.6	55.2	68.8	9.30	5.92

* Numbers may not add up due to rounding. ** Compound Annual Growth Rate

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CATALOG INDUSTRY INCREASES EFFICIENCY/2

The DMA study also shows that ad spending is growing at similar rates in both the consumer and business-to-business markets.

U.S. Catalog Ad Spending ($ in billions)*

	1998	2002	2003	2004	2008	CAGR 1998-2003**	CAGR 2003-2008
Total	11.3	14.8	15.3	16.1	19.4	6.25	4.75
Consumer	7.4	9.7	10.0	10.5	12.7	6.22	4.76
Business	3.9	5.1	5.3	5.6	6.7	6.29	4.72

* Numbers may not add up due to rounding. ** Compound Annual Growth Rate

While catalog sales are expected to grow 5.88 percent annually through 2008, industry employment is expected to grow at a 1.94 percent annual rate. In fact, from 2002 to 2003, catalog employment is expected to drop slightly from 529,000 to 528,000, another reflection of the industry doing more with less.

U.S. Catalog Employment (in thousands)*

	1998	2002	2003	2004	2008	CAGR 1998-2003**	CAGR 2003-2008
Total	440	529	528	543	581	3.71	1.94
Consumer	268	321	320	330	354	3.62	1.99
Business	172	208	207	214	227	3.85	1.86

* Numbers may not add up due to rounding. ** Compound Annual Growth Rate

The DMA is the leading trade association for businesses interested in interactive and database marketing, with nearly 4,700 member companies from the United States and 53 other nations. Founded in 1917, its members include direct marketers from every business segment as well as the nonprofit and electronic marketing sectors. Included are catalogers, Internet retailers and service providers, financial services providers, book and magazine publishers, book and music clubs, retail stores, industrial manufacturers and a host of other vertical segments, including the service industries that support them. The DMA's Web site is www.the-dma.org, and its consumer Web site is www.shopthenet.org.

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