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Libey Incorporated
Economic Outlook
Secrets of the Catalog Master
Vol. MMV No. 3 May 2005
(Continued--page 2)
The Second Quarter 2005 Regional Economic Outlook
While the majority of business-to-business direct marketers and most consumer direct marketers report the year continues to look positive, there is a bit of softness entering the picture in late April. There have been weather distractions and almost a month of concentration on the changes at the Vatican, but there is also some softening in the leading economic indicators, such as housing starts, employment growth, retail sales, and manufacturing production. Additionally, higher interest rates and the record energy costs have caused some slowing and the market response to inflationary fears is palpable.
We continue to believe that marketers should pursue prospecting and customer contacts reasonably aggressively, even in the coming summer months. We remain positive for the second quarter 2005 outcome and neutral on July and August 2005 until further energy price activity emerges. All regions continue to benefit, albeit at a slightly reduced rate of growth than we saw in the first quarter of 2005.
Region
One (CT, ME, MA, NH, RI, VT)
Region Two (NY, NJ, CT, PR, VI)
Region Three (PA, NJ, DE)
Region Four (OH, KY, PA, WV)
Region Five (KY, MD, TN, VA, NC, SC)
Region Six (GA, AL, FL, LA, MS, TN)
Region Seven (IL, IN, MI, WI, IA)
Region Eight (MO, IL, IN, KY, TN, LA, AR)
Region Nine (MN, WI, ND, SD, MT, MI)
Region Ten (KS, CO, MO, NE, NM, OK, WY)
Region Eleven (TX, LA, NM)
Region Twelve (CA, UT, AZ, NM, OR, WA)
Mixed to Slower
None
The Second Quarter 2005 Circulation Outlook and
Recommendations
Synopsis
The short-term economic outlook for the catalog industry continues to be reasonably positive through the first half of 2005. There are some signs of slowing emerging, especially in leading indicators, which may be signaling moderation in the late summer and third quarter. The intermediate-term outlook is positive for the balance of 2005, and the long-term outlook through 2007 remains positive.
Keep Prospecting
Once again, perspective is essential. If you will think back over the years and recognize how many companies have regretted their short-term decisions to pull back in either economic downturns or periods of threat, you will once again conclude that reducing prospecting and house mailings at any time is always a strategy for slowing the growth and profitability of the business longer-term. The savings of a few thousand dollars in times of pressure can result in the loss of many more thousands of dollars in future profits and business valuations. Multi-channel marketers are having good results. This is because we are so far advanced over other forms of commerce. You have invested in advanced online marketing and you have wisely continued to support, grow and invest in your catalog businesses because you know that those catalogs are driving substantial number of online orders. If the media and the politicians create doubt, it’s about power. Our jobs are about focus and consistency. Those are the qualities that deliver increased corporate valuation. The point: Prospecting isn’t an optional strategy; it is a constant strategy that produces profits.
Nation At A Glance
The detailed economic conditions for each state have been integrated into the following recommendations. Changes to circulation recommendations through the Second Quarter 2005 are highlighted in bold italics. A number changes are recommended for the second quarter, all shifts from Normal to Increased mailing.
| State |
Mailings |
|
|
| Alabama |
Normal |
| Alaska |
Normal |
| Arizona |
Increase |
| Arkansas |
Normal |
| California |
Increase |
| Colorado |
Increase |
| Connecticut |
Normal |
| Connecticut-Fairfield |
Increase |
| Delaware |
Increase |
| District
of Columbia |
Increase |
| Florida |
Increase |
| Georgia |
Increase |
| Hawaii |
Normal |
| Idaho |
Normal |
| Illinois—North |
Normal |
| Illinois—South |
Normal |
| Indiana—North |
Normal |
| Indiana—South |
Normal |
| Iowa |
Increase |
| Kansas |
Increase |
| Kentucky—East |
Normal |
| Kentucky—West |
Normal |
| Louisiana—North |
Normal |
| Louisiana—South |
Normal |
| Maine |
Normal |
| Maryland |
Increase |
| Massachusetts |
Normal |
| Michigan |
Normal |
| Michigan—Up.
Pen. |
Normal |
| Minnesota |
Increase |
| Mississippi—North |
Normal |
| Mississippi--South |
Normal |
| Missouri—North |
Normal |
| Missouri—South |
Normal |
| Montana |
Normal |
| Nebraska |
Normal |
| Nevada |
Normal |
| New
Hampshire |
Normal |
| New
Jersey—North |
Increase |
| New
Jersey-South |
Increase |
| New
Mexico—East |
Normal |
| New
Mexico—West |
Normal |
| New
York |
Increase |
| North
Carolina |
Normal |
| North
Dakota |
Increase |
| Ohio |
Increase |
| Oklahoma |
Normal |
| Oregon |
Increase |
| Pennsylvania—East |
Increase |
| Pennsylvania—West |
Increase |
| Puerto
Rico |
Normal |
| Rhode
Island |
Normal |
| South
Carolina |
Normal |
| South
Dakota |
Increase |
| Tennessee—East |
Normal |
| Tennessee—West |
Normal |
| Texas |
Increase |
| Utah |
Normal |
| Vermont |
Normal |
| Virgin
Islands |
Normal |
| Virginia |
Increase |
| Washington |
Increase |
| West
Virginia-East |
Normal |
| West
Virginia-West |
Normal |
| Wisconsin—North |
Increase |
| Wisconsin—South |
Increase |
| Wyoming |
Increase |
New Services
Libey Incorporated, our advisory practice, has begun three new services for multi-channel direct marketing CEOs and companies. They are: BoardroomAdvisor; ResearchAdvisor; and WebsiteAdvisor. Descriptions can be found on our website www.libey.com.
BoardroomAdvisor is a unique service providing CEOs with access to strategic evaluation and advisory services on a flexible and very affordable subscription basis. It gives CEOs access to Don Libey for extensive strategic consultation without the expense of travel.
ResearchAdvisor is a custom direct marketing research service also on a flexible, affordable, subscription basis. It fills the need for practical ‘hands-on-find-answers’ research for direct marketers by direct marketers.
WebsiteAdvisor is a one-of-a-kind service. WebsiteAdvisor uses a proprietary protocol to evaluate your direct marketing website on a low-cost basis. It delivers practical, useful and common sense information that you can immediately use to improve your customers’ perceptions about your online business. WebsiteAdvisor is a qualitative review focused on your website’s credibility and aesthetics.
For many direct marketers, business-to-business or consumer, the last thing you need are more usability studies or quantitative analyses of the website technical elements; these can be obtained by many web analytic vendors. WebsiteAdvisor looks at the really important credibility and aesthetic elements of your website. Our researchers have reviewed thousands of websites and have found over 50 unique credibility elements that must be included for you to generate buyer trust. WebsiteAdvisor also examines practical elements of your website, from the ‘mildly irritating’ to the outright ‘turn offs’ of the structure, format and aesthetics of the presentation.
WebsiteAdvisor is not ‘click analysis’ or unique visitor analysis; it is a comprehensive and candid evaluation of what is good, what is bad, what is ugly, what is missing, and what there is too much or too little of to be effective. WebsiteAdvisor is unlike any other review available to the multi-channel direct marketing company relying on their website for a significant portion of sales.
As an introductory offer, the thorough review covering the all-important credibility and practical elements of your website is only $500, paid in advance, until September 1, 2005 (possibly the best and least amount of money you will ever spend on your website). Consider the benefits of the WebsiteAdvisor review. Visit our website and contact Andrea Stewart to assist you with a valuable review of your website today. Her email is: stewart@libey.com. Of course, MeritDirect and Amtower & Co. clients receive courtesy fee reductions on these and other advisory services of Libey Incorporated.
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