Is the Store Becoming Obsolete?

Yes, say new champions of an old idea: mail order

Shopping is not as much fun as it used to be. During peak buying seasons like the monthlong countdown to Christmas that begins every year after Thanksgiving, it can be downright agony for some people. Parking is a pain, stores are crowded, and sales clerks are often inexperienced or hard to find. One result has been a burst of new activity in an old idea: mail order. Not since Chicago Merchant Aaron Montgomery Ward put out his first "catalogue"--a one-page number flogging bed ticking, hoop skirts and $8 ladies' watches--almost a century ago has there been such high interest in ways of shopping without stores.

This year Americans will buy a record $22 billion worth of goods through catalogues, brochures and other kinds of mail-order offerings. Such purchases have become the fastest growing area of U.S. retailing, and they now account for fully 18% of all the general merchandise sold. Some experts believe that that percentage will grow much more. Maxwell Sroge, a Chicago-based mail-order consultant, goes so far as to assert that catalogue sales may prove to be the biggest revolution in shopping ever. Says he: "If you have insomnia, you can shop at four in the morning. It's a store that never closes."

The biggest factor behind that phenomenon has been the rise of two-income families, in which neither spouse has much time to spend prowling through stores. Other converts to catalogues are affluent singles and childless couples whose active working and social lives similarly leave little room for shopping. To reach these busy big spenders, retailers are increasingly resorting to the mails, and the result has been an explosion not only in the number of catalogues but also in the variety of goods that can be bought through them.

This season the holiday exotica that can be ordered by mail are more extravagant than ever. Neiman-Marcus, the tony Texas chain, has sent the 350,000 customers on its nationwide mailing list a batch of Christmas gift suggestions that range from monogrammed "passports" for pet dogs or cats ($18) to an edible Monopoly set made of several kinds of chocolate ($600), and a Wooton desk that once belonged to Queen Victoria ($150,000). In Manhattan, trendy Bloomingdale's is countering with the perfect gift for the aspiring Truman Capote for $100,000 the store will arrange a holiday party for 500 at New York City's Lincoln Center culture temple that includes cocktails, dinner and a ballet performance.

The mail-order surge is by no means confined to holiday hedonism. While mail order has long been a mainstay for publishers of magazines and books, other firms are being lured into the field, partly because of its attractive economics. Fancy catalogues can be expensive to prepare and distribute, but it costs even more to maintain stores and sales staffs; and mailorder firms generally enjoy a profit of 6% on sales, whereas that of conventional retailers is 3.5%.

As a result, all sorts of retailers are stepping up their mail-order activity. Bloomingdale's used to put out catalogues just to draw customers into its stores; now mail and phone orders account for a substantial part of its business. At Montgomery Ward, where mail-order business slumped sharply in the 1950s and early 1960s, catalogue sales are back at record levels.

The urban buyers who have replaced farm families as the company's chief catalogue customers are going for many items that never before sold well by mail. Among them: women's dresses, including disco outfits, a particularly hot item. As a consequence, the firm will soon open a new catalogue sales outlet in Cincinnati, the first it has opened in 50 years.

American Express has been plying its 7 million credit-card holders with regular mailings of slick, colorful brochures and catalogues offering a variety of goods, including such extravagances as coin banks in the shape of Peanuts characters for $20 and up, and a $12,500 home disco sound system. Sales of such items have doubled in the past four years. With the traveling show of the treasures from Tutankhamun's tomb due to begin a long stay at Manhattan's Metropolitan Museum in December, American Express is offering several items of pricey Tutiana, including a 6-in. china bust of the Egyptian boy-king costing a princely $200.

Several individual entrepreneurs have made the profitable discovery that, as Maxwell Sroge puts it, "you can find a market through mail order in expensive items even if you operate out of Muleshoe, Texas." Roger Horchow, 50, a former mail-order executive at Neiman-Marcus, set up his own catalogue business seven years ago; his Dallas-based Horchow Collection will pull in $38 million this year, all generated by the 30 million catalogues that Horchow sends around the country. One example of mail order's pulling power: in September, Horchow began marketing a perfume called L'Envoi at $75 an ounce; though customers had no way of trying the fragrance as they could in a store, Horchow has already received orders for more than 1,000 bottles.

Competition is increasing--according to Horchow, 40 new enterprises have entered the so-called luxury-catalogue field this year--but mail-order men believe that their industry has plenty of room for growth as long as they keep finding new ways of making stay-at-home shopping easier. For instance, the hassle of filling out and mailing coupons is being eliminated, because orders are increasingly made by toll-free telephone and charged to a credit card. In Columbus, Warner Communications has established a catalogue sales convenience geared to the video generation: a cable TV hookup that, among other things, lets shoppers examine items for sale on their home sets. By means of a special attachment on his set, a viewer can order a product or ask for more information. Warner is so pleased with results from the 25,000 hookups in Columbus that the company plans similar operations in Akron, Fort Wayne and Pittsburgh.

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