Merchandising and the life cycle of books sold by mail

Space allocation is a major decision for the catalog business. It depends on the demand function and management constraints. Sales elasticities with respect to price and catalog space allocated to books sold by mail order are measured at different stages of the product's life cycle. Econometric analysis of a sample of more than 700 observations for books sold by a French catalog club confirms that price elasticity is higher for repeats than for new books. Surprisingly, space elasticity is stable for the two groups. The study also concludes that some results obtained in advertising research on the effect of so-called mechanical variables of catalog display (frame, left/right page, etc.) are also valid for catalogs.