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News
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Catalog sales safe
graphic October 24, 2001: 5:40 p.m. ET

Catalog, online retailers reassure consumers that packages are safe from anthrax.
By Staff Writer John Chartier
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NEW YORK (CNNmoney) - Consumers have little to fear from anthrax-laden parcels or tainted catalogs say the nation's mail order retailers and industry experts.

Expected packages from reputable companies such as Lands' End, ebay, Amazon.com, or Lillian Vernon pose little threat, especially since they are shipped via the United Parcel Service or Fedex and not the U.S. mail, the companies said.

"The issue for direct marketing companies is that we were already dealing with a recession and a war so now we have a third area of concern - anthrax," said David Hochberg, a spokesman for catalog marketer Lillian Vernon. "But the advantage Lillian Vernon has is we have a widely known brand name that's been around for 50 years, so when a consumer gets a package from us it's not like they're receiving a suspicious or unknown box."

Recent news of postal workers in New Jersey and Washington, D.C. becoming infected with the anthrax bacterium has sparked public concern, so retailers and industry observers are eager to reassure customers that their orders are safe.

"I think the anthrax situation we have today primarily involves the U.S. mail. Catalog retailers are using private carriers," said Derek Leckow, a retail analyst with Barrington Research Associates. "I'm not sure how they differ in terms of security measures, but just looking across the board, companies are investing in technology for security and I think all this information is getting to the consumer."

As the crucial retail holiday season approaches, mail order companies say they have not seen a falloff in orders or received many inquiries from customers about the possibility of tainted packages arriving in the mail.

Many said they are not altering plans for catalog or order shipments, though they have begun to more closely inspect packages throughout the ordering process, from the phone call or mouseclick to loading onto the truck.

"All plans are moving ahead as we planned them for the holidays," Lands' End spokeswoman Beverly Holmes said.

Holmes said the apparel retailer has always had a policy of physically inspecting every order even to the point of company employees loading them onto the trucks, but she encouraged customers to call immediately if their package is torn, or shows signs of tampering in any way.

A spokesman for online auctioneer ebay Inc., which reported better than expected third quarter results this week, said customers have a comfortable familiarity with the company and are typically expecting packages when they place an order.

"On ebay, the packages people are receiving are expected. They(consumers) have contacted a seller, have been bidding on the item and there's feedback, so usually you're expecting a package," spokesman Henry Gomez said. "You usually have some sense of what you're getting."

J.C. Penney Inc., the No. 5 U.S. retailer operates a $4 billion a year catalog business. Though that unit has struggled with lower sales in the last few years as the company went through a restructuring, J.C. Penney is not altering shipping plans for the holidays.

"We did not change any of those plans in terms of quantities of catalog pages for books or activation(mailing) dates following Sept. 11," spokeswoman Stephanie Brown said. "We already had a conservative sale plan for catalogs and we did go back and re-forecast that. We don't expect a significant impact to financial results."

Quantifying just whether any drop in sales is related to anthrax or terrorist fears, or is simply a result of less spending in an economy that has been slowing all year is virtually impossible, but industry reports have noted that retail sales, while down year-over-year, have bounced back to pre-attack levels.

Nevertheless, a few residents in the metropolitan New York postal region, which includes Trenton, N.J., where anthrax-laden letters were mailed to NBC anchor Tom Brokaw and Senate Majority Leader Tom Daschle, have stopped receiving mail, said Dan Quinn, a spokesman for the New York City Department of Public Affairs.

"There are a minimal, and I mean a minimal, number of customers in the New York area who are not taking mail," Quinn said.

The National Retail Federation is predicting a scant 2.5 percent increase in holiday sales this year compared with about a 5 percent increase the previous year, mainly because of decreased spending in the face of layoffs, volatile stock markets and uncertainty about a recession.

However, Shop.org, the NRF unit representing online and catalog retailers, is sticking with its April prediction of $65 million in e-commerce sales this year, significantly higher than a year earlier.

"We're anticipating a very strong online shopping season, and one of the reasons is that consumers are cocooning, nesting, staying closer to home," said Elaine Rubin, Shop.org's chairman. "This holiday season people are sending gifts to loved ones, or they're going to reach out and remember people that maybe they didn't send a gift to last year. We really think that gift giving is going to be big."

Many catalog merchants shipped their holiday books before the Sept. 11 terrorist attacks, which means the likelihood of catalogs picking up anthrax spores at the post office is extremely low.

"Retailers are going to use any method of delivery to get merchandise to customers. We continue to have faith in the system," NRF spokeswoman Sarah Scheuer said. graphic





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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.

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