Catalina comes back

By Published on .

Most Popular
While several players in shopper marketing have struggled of late, Catalina Marketing appears to be making a rebound and has signed an early client for a new in-store advertising vehicle launched earlier this year.

Catalina saw sales in its core store-based marketing services, including the Checkout Coupon network and Health Resource Publishing, rise 15.1% to $95.4 million last quarter. Results for direct mail, market research and Japanese billboard services the company is in the process of divesting dragged sales growth down to 3%, but sales and earnings still beat analyst estimates.

It was welcome news for one of the biggest players in in-store marketing following a year that saw Catalina completely overhaul its senior management and twice replace its external auditors and restate financial results. And Catalina followed it by announcing earlier this month that Tyson Foods has signed up as one of the charter clients for its new Catalina Targeted Advertising service, in which its point-of-sale coupon machines print advertising messages rather than cents-off promotional offers.

Tyson's three-day national run on the Checkout Message service is part of the company's broader "Powered by Tyson" rebranding effort focusing on the protein content of its products.

"We basically own this little moment in time" at the checkout, Mr. Seckar said, "which is an advantage over the clutter in TV and other media. It's harder and harder to talk to consumers you want to, because there's so much fragmentation in media out there."

Tyson is one of about a dozen package-goods marketers that have signed up to use Catalina Targeted Advertising. And while its use is for a single message related to its broader ad campaign, Mr. Seckar sees the service being used mainly to deliver a series of messages targeted to consumers.

Some programs, he said, start by bashing a competitor's brand and continue by hitting hard on benefits likely to be relevant to the targeted consumers based on their purchase history. A test with a pet-food brand improved purchase intent scores by three percentage points among loyalists to a competitive brand, nine points among brand switchers and eight points among consumers already loyal to the sponsoring brand, Mr. Seckar said.

Other users of the new service are reluctant to come forward, he said, in part because it tends to operate under the radar and is difficult for competitors to track.

Catalina Category Marketing, another new program in which marketers use the system to encourage multiple product purchases and return visits to supermarkets rather than conventional cents-off discounts, has brought in about 40 marketers. Mr. Seckar said Catalina also has seen "strong renewals" by marketers for its regular Checkout Coupon offerings.

One advantage Catalina has over other players in shopper marketing is that it has little direct competition at cash registers for its Checkout Coupon system in 17,000 supermarkets, Mr. Seckar said. Another is that it's generally funded out of national consumer-promotion-budgets controlled by brand and promotion managers rather than trade-promotion dollars controlled by sales reps and retail buyers.

"Some of the co-marketing programs," he said, "are very specific to the retailer and are a redirection of funds a retailer might have been getting anyway. At the end of the day, that may not be all that positive for the retailer."

In this article: