Lesson #2 from 3 Key Lessons to Maximize your Gift Catalog

Although I’ve worked with many different nonprofit organizations to grow their fundraising, one of the most fulfilling parts of my career was providing support to grow the World Vision gift catalog’s revenue by over 300% in a five-year period.

Like undertaking any large project, mistakes happened along the way. I’m here to share them with you, so that you can learn from a tried-and-tested method.

Lesson #2: Conducting a detailed product analysis is essential

Evaluating the effectiveness of a gift catalog program can be a little trickier than a traditional direct mail appeal. Instead of one offer, you have dozens (and sometimes hundreds) of products all taking up valuable real estate.

More often than not, valuable space is taken up by a product favorite of the marketing team (even though it underperforms) or by an editorial section that MUST be included.

SQUINCH that Gift Catalog!

To evaluate a catalog, you use what’s called a “SQUINCH Analysis” which is short for “square inch analysis.” While it primarily refers to your print catalog (which is a major driver to your online traffic) the same findings often carry over to online. If a product is performing well in print, you can bet it’s probably doing well on your website!

To perform a SQUINCH, you need the following data points:

• The total costs of your print catalog (print, postage, mailing services)
• The total number of square inches in your catalog
• Product revenue, ideally by channel (print, online, and “other”)

You can then take these costs to determine your total cost per square inch:

Next, you’ll measure out the number of square inches that a product takes up on a page. For example, let’s say your catalog page is five inches wide by 10 inches tall, which is 50 square inches. If your product takes up half a page, that’s 25 square inches of catalog space.

If that product generates $10,000 in revenue, that’s $400 per square inch of space. Let’s say that your catalog costs $100 per square inch to print and mail. That’s a 3-to-1 ROI. While that’s not bad, you’ll want to benchmark that product against the others and ask the following questions:

• Should I make this product smaller on the page?
• Should I move its position in the catalog? (e.g. does it deserve to be on the inside cover?)
• Should I revise the product photo or description to make it more appealing?

As you can see, these decisions are not always cut and dry. But if you apply a solid methodology to your evaluation you can make educated decisions that are not driven by creative (or department) biases.

To read the last Gift Catalog lesson, stay tuned for our next blog post. You can sign up to receive our updates here.

To read more about my experience growing the gift catalog program at World Vision, and to view Lesson #1: Treating the gift catalog like a direct mail appeal, read our last post here.