Catalog 1: New type of shopping channel


Direct mail is about to become even more direct.

Eight catalog retailers are bypassing the post office and beaming their merchandise right into homes. Catalog 1, the new cable shopping channel developed by Time Warner and Spiegel that hits the airwaves in four test markets on March 28, features the wares of eight well-known retailers with sophisticated direct-mail operations.

The channel debuts at a time when consumer complaints about cluttered mailboxes are growing louder and angrier and electronic retailing threatens to make catalogs obsolete.

But Catalog 1 is more than an if-you-can't-beat-'em-join-'em effort. From the way its business is structured to the goods it will try to sell and the pitch it will use to sell them, Catalog 1 is breaking the television shopping mold set by Home Shopping Network Inc. and QVC Network Inc.

Highbrow production techniques and scripts that read more like afternoon talk shows than sales spiels are aimed at enticing upscale shoppers who have thus far eschewed electronic retailing.

Catalog 1 will feature merchandise from Spiegel and its Eddie Bauer outerwear subsidiary, as well as from Williams-Sonoma, Sharper Image, Neiman Marcus, the Nature Company, Crate and Barrel and the Bombay Company.

And unlike QVC and the Home Shopping Network, whose fees and other requirements make it almost impossible for a retailer to make a profit selling on their networks, the direct-mail companies participating in Catalog 1 are paying the channel about what it would cost them to produce and mail a catalog.

"We're not trying to create just another shopping channel," said Rod Parker, the former Spiegel executive who is the manager of Catalog 1. "We're trying to create an entirely new channel of distribution for people who already have distribution through other channels, like retail stores and catalogs."

But Catalog 1 and several other shopping channels debuting this year must also prove that high-end electronic retailing is cost-effective.

Although the company will not discuss its finances, retail consultants believe Catalog 1's cost to produce a single program for its participants is probably between $300,000 and $500,000, about as much as for the highest quality "infomercials" -- lengthy television advertisements that appear to be programming.

"Because of the technology, it's going to be a lot more expensive than the average retail test, and companies are going to have to be in it for the long haul," said Wendy Liebmann, president of WSL Marketing, a consulting firm in New York. "That's the real question for me."

Being on the set of Catalog 1 incites the same sense of incredulity that Clara must have felt when she crept downstairs nTC on Christmas Eve and found the Nutcracker dancing about her living room.

"It's a cross between '20/20,' the evening news, a talk show and the very best infomercials," said Richard Thalheimer, chairman and chief executive of Sharper Image. "It gives the merchandise a context that you can't provide in a catalog."

Suddenly the candlesticks, plates, carpets and other tchotchkes that are so one-dimensional on the pages of Neiman Marcus' Horchow Collection catalog of home furnishings come to life, seeming to have a place in the real world that they lack in the suspended fantasy of glossy photographs and grand descriptions.

Carol Helms, creative director of Metropolitan Home magazine, demonstrates how to mix and match chargers, plates and napkins from the Horchow Collection, chatting all the while about entertaining in the '90s.

A segment on a snore control device sold by Sharper Image takes place at a sleep research laboratory, where a doctor who specializes in sleep disorders explains why people snore.

On Catalog 1, the line between selling and telling is much fuzzier than on QVC or the Home Shopping Network, where program hosts shamelessly hawk products, and where horns and whistles are used to keep viewers attentive.

The risk in such low-key selling is that the potential shopper will have trouble distinguishing between entertainment and marketing.

But Mr. Parker cited a survey from Yankelovich Partners that found that women are more interested in information about the ** products they might buy than in a sales pitch.

The appearance of an "800" number and a description of the merchandise will also help remind Catalog 1 viewers that they are listening to a sales pitch.

Catalog 1's first test will reach about 400,000 homes in Nashua, N.H.; Columbus, Ohio; Rochester, N.Y., and suburban Milwaukee.

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