The country’s biggest printer PMP has pinned its future business on catalogues, during a break-down of business functions at its Annual General Meeting (AGM).
In his address to investors, PMP chairman Matthew Bickford-Smith described catalogues as the core of PMP’s future business, and quelled assumptions that the sector was a declining marketing form.
“The core of our future business will still be in catalogues, which the Board is confident will remain a robust channel for our customers. Retailers have tried cutting down on catalogues, but consumers like them. More people read catalogues than national newspapers, when you cut catalogues you cut sales,” says Bickford-Smith.
“Catalogues to the letterbox remain an important element of what marketers call the omni-channel mix and we expect catalogues to be a key marketing platform, particularly for groceries, liquor and other sectors.”
PMP’s profits this year were buffeted by the Dick Smith collapse and the termination of an old-bond, resulting in a skeletal margin of only $185,000.
The printer however managed to keep its sales figure high with a 3.3 per cent jump, thanks to powerful spending patterns in its catalogue and newspaper delivery division Distribution Australia.
Bickford-Smith says PMP’s pending merger with fellow printer IPMG will only bolster its formidable presence in the catalogue printing market.
“In joining forces with the Hannan family through the proposed merger, PMP will be a leading force in the catalogue printing and distribution market. The merged company will be able to optimise its print fleet and invest in the latest digital technology to meet the ongoing demand for integrated, end-to-end print and distribution solutions,” he added.
[Related: Industry shock as PMP to merge with IPMG]
CEO Peter George also praised catalogues as one of the few print forms enjoying stable growth in PMP, but says the retail industry’s print spend was affected by declining consumer spending habits.
“The retail industry continued to struggle with low consumer confidence. Pricing levels remained depressed but stable, resulting in some churn in sales contracts as competitors tried to lock in contracts to cover their fixed overheads,” says George.
“Catalogue demand however remained relatively stable, with slightly higher deliveries in Australia and New Zealand.”
Australasian Catalogue Association CEO Kellie Northwood attests to the power of letterbox marketing, and says the printed catalogue is stronger than ever particularly in the festive season.
“Catalogues are a significant sales driver throughout the festive season and retailers are preparing their strong sales positioning and brand engagement development,” says Northwood.
ACA found the latest Audience Reach stats show catalogues access 21.8 million Australians every week, and rank the second highest most useful media on a customer's purchasing journey.
Commenting on PMP’s forecasts for the 2017 financial year, George says market conditions will continue to be challenging.
“Management has identified further cost saving measures to be implemented in the second half of FY17, should PMP continue to stand alone in this difficult trading environment, which will bring results in line with expectations for the full year,” he adds.
PMP’s share price has dipped slightly since skyrocketing 37 per cent to 87c following merger news, it is currently trading at 79c.
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