November 1, 2011 - Economic uncertainty and Chapter 11 stories have been prevalent within the multichannel marketing industry in 2011. Tully & Holland Managing Director, Chris Kampe summarizes the divestiture activity in 2011 and expectations for 2012.  “Larger companies divested non-core titles and bankruptcy sales ensued.  As postage costs continue to rise, making scale becomes more important for catalog businesses to enable the leveraging of creative, merchandising and fulfillment costs over sales volume,” according to Chris.

Chris forecasts a continued shift toward internet transactions and expects further divestiture of non-core catalog titles: “Faced with lower profitability levels, smaller catalogs will continue to gravitate toward an internet retail model and prompt some smaller catalog companies to sell.  Many of the larger catalog companies, once active buyers, are becoming increasingly interested in divesting non-core underperforming titles.  We expect many well-known catalogers to divest titles in 2012.”

“On the internet retail front, changes at Google have dramatically reduced organic search and forced internet retailers to increase their search advertising budgets, placing pressure on profitability,” Chris adds.