A little oatmeal was all she wanted. So really, any place downtown would do. But the Oak Terrace at the Drake Hotel was noisy and the table the maitre d` offered was a tad plebeian. At the Mayfair Regent, the first floor buffet looked tempting. But there appeared to be neither waitresses nor bowls of oatmeal around.
And so, Lillian Katz, queen of the mail-order catalogues, America`s high priestess of direct marketing, found herself without reservations at Ciel Bleu on the top floor of the Mayfair.
”A table for two,” she commanded in a low, friendly voice as she stalked regally into the sunlit restaurant. ”And bring lots of caw-fee. What the heck, it`s Saturday.”
She eyed the crisp white table linen and heavy flatware approvingly. Lake Michigan was an indigo carpet at her feet, cocoons of clouds hung outside the wrap-around windows, and the oatmeal, steaming hot, was served in sparkling white china bowls.
GOOD TASTE COUNTS
”Isn`t this nice? Now, isn`t this just nice?” she said, her voice slightly raspy. For Katz, 61, founder and chief executive officer of the Lillian Vernon Corp., there`s absolutely no reason why anything, even eating oatmeal, should not be done with style.
Good taste counts, she says often. Good taste sells. ”There is good taste in my catalogues,” she said, tapping an enameled fingernail lightly on the table. ”There isn`t a single thing in my catalogue that I wouldn`t give to someone or buy for myself.” Indeed, when she bought her current home in Greenwich, Conn., in 1978, she spent $1,500 buying dishes, flatware, wastebaskets, and pots and pans from her own catalogue. And what she couldn`t find, she put in her catalogue the following year.
It is that offer-others-what-I`d-buy philosophy that has helped boost Katz`s mail-order business from $16,000 in sales when she started 37 years ago to $126 million in revenues this year.
She has been successfully marketing her sense of style to millions of Americans ever since that fateful day in 1951 when, as a 24-year-old pregnant housewife, she placed an ad in Seventeen magazine and began selling monogrammed belts and purses from her kitchen table.
Now, every few months, her chatty catalogues-pushing everything from $2.66 satin shoe stuffers and $8.98 graters to $35 dollhouses and $37 monogrammed terry robes-arrive at the doorsteps of 9 million customers.
Among them are Frank Sinatra, Betty White, Steven Spielberg and Loretta Lynn. Even Ronald Reagan wore one of her shamrock ties last St. Patrick`s Day. In Illinois, 243,058 people-including 46,855 Chicagoans-have ordered from her catalogues in the last two years.
SINGING HER PRAISES
”Hey, there`s no question about it, her stuff is excellent quality,”
says Roger G. Hill Jr., president of the Gettys Group Inc., a Chicago consulting and development firm. ”Her catalogue is well laid out and it makes shopping at home fun. I`ve bought towels, dish racks, kitchen accessories, a briefcase, glassware . . . and, I have to admit, I`ve also had my name monogrammed on the towels.”
Hill, who has met Katz several times, equates her sales know-how with that of ”L.L. Bean, the granddaddy of them all” in direct marketing. Adds Hill, ”Her own personal style is incredible-timely, timeless and tasteful.” Chicago direct-marketing consulting guru Maxwell Sroge Sr. describes Katz as a brilliant merchant with an outstanding reputation, a merchant watched carefully by others in the roughly $50 billion U.S. direct marketing business. ”She sources outstanding material that people are happy to buy, and her prices are about what most people can afford,” he says. ”Her catalogues are among the best in the business. She just runs a top-notch business, and she runs that business in a category-specialty sales-in which several companies, such as Sunset House, are not doing well.”
THAT `GOLDEN GUT`
How has an energetic housewife from Mt. Vernon, N.Y., kept up sales year after year so that when her company went public in 1987 it became the largest company founded by a woman to be listed on the American Stock Exchange? Katz says it`s her ”golden gut” that`s done it.
She has, she says simply, an unfailing instinct for knowing what will sell, for knowing what the majority of her customers-women around age 38 with an annual household income of $44,000 or more-want to buy. ”I come up with my ideas because I run a home. I ran a home for 39 years,” she said between several quick swallows of coffee at Ciel Bleu. ”I entertain. I travel. You know. I think that`s one of the ways you learn what people need. And, I dress up. I know what fashions are. I know what customers want. I have a real feel for merchandise. I think I have innate qualities that are just there.”
That golden gut. The old gal still has it-and it shows. At 61, she looks 10 to 15 years younger and rushes around as energetically as a woman half her age. She follows trends, and these days favors slim skirts that skim her knees. At breakfast, she sported a black skirt, a black and orange georgette blouse and a black shawl draped front-to-back across her shoulders. Either the shawl or the blouse could have come from her catalogue.
MEETING THE PUBLIC
Suddenly, she unclasped her hand over her bowl of oatmeal. From her fingers dangled a string of rare, gray-white South Sea pearls, each the size of a small olive. ”This is my going public present to myself,” she murmured, wrapping the pearls around her throat. ”I`d always wanted to go public (with the company). It was a career goal. We did it just before the stock market crash. My timing couldn`t have been better.”
Katz`s pearls, and her collection of art and Queen Anne silver, cropped up often in chit-chat the night before at a party thrown by Chicago gallery owner Roberta Lieberman at her arty Delaware Place apartment.
Katz spent most of that evening-from the wines to the curried chicken and coffee-in deep conversation with Bruce Guenther, acting director and chief curator of Chicago`s Museum of Contemporary Art. ”I wish I had had someone like him to guide me when I was buying my art,” she lamented later.
Guenther, however, thinks she has done just fine. ”She travels a lot and is very knowledgeable about antiques and silver and things like that,” he said. ”She is an impressive woman because she has such a clear vision of what she wants to do with her life. In her catalogues, she offers the middle-class practical things, and elegance, a little indulgence, that doesn`t cost an arm and a leg.”
WOMAN IN CHARGE
Katz is not shy about using her sense of graphic art. She often suggests the size of photos in her catalogues and tells staffers where to run them and how to display items.
Despite having six buyers and 1,000 employees during peak seasons, Katz remains the company`s chief buyer. Together with her buyers, she logs about 100,000 miles a year in 16 weeks on buying trips to cities such as London, Paris, Canton and Milan.
Katz is the arbiter of the Lillian Vernon catalogue. And she never wants her customers to forget she is their friend. So her catalogues carry warm, chatty letters crowned with her picture, touches originally suggested by a friend and now copied by others in the industry. ”I hope you`re happy with your purchase, and that you`ll enjoy these extra 83 first-quality products priced for big savings . . . Thank you, dear friends, for making a dream a reality,” gushes one letter simply signed ”Lillian.”
SOUNDLY SCOLDED
She also is quick to respond to customer complaints and suggestions. One of her most popular items has been a series of brass Christmas ornaments (now $3.50 each) with the year engraved on them. Katz has sold more than 74 million brass ornaments in 250 designs since she began selling them 20 years ago. ”I have a little factory in Providence, R.I., where we make these,” she said, reaching across the table for her 1988 Christmas catalogue. ”In 1967, I just decided that people would like to hang something on their tree with the year on it. Last year, we eliminated the year, and we got thousands and thousands of letters from people who were very, very angry we did that. So I put them back on.”
Katz doesn`t bother with market research; her golden guts have rarely led her astray. Like a homing pigeon, she has zoomed in on trends just as they are taking off. Traveling around the country one year, she noticed several pregnant women. ”My gosh, the whole world is pregnant,” she thought, and promptly put in a kids` line. She scored. Children`s toys and linens now make up 20 percent of her business.
”I read an article recently that people are spending much more money on their homes,” she confided. ”That`ll probably be reflected in our catalogue soon. I`ll offer more things for the house.”
Her golden gut has launched such other winners as shamrock-patterned pantyhose (50,000 pairs sold a year), 15-cent personalized pencils, satin lingerie cases and I-Love-Grandma (or Grandpa) picture frames.
THE LOSERS
But Katz also has bombed with ”Garbo,” a spray perfume for garbage cans, and a combination kids` knapsack and sleeping bag that turned out to be too complicated to work.
”Last spring we made another mistake,” she recalled. ”We had tried to buy Childcraft, a children`s catalogue. We could not. `All right,` I said,
`we`ll do it ourselves.` We didn`t do a good job; we increased our children`s business without being profitable.”
While only 20 percent of the company`s sales come from kids` lines, the firm devoted 33 percent of its catalogue offerings to that segment. Things just did not move fast enough. ”What did we do? We cried. We got through the spring and we said, `Never again.` You don`t really learn unless you learn from your mistakes.”
IN THE BEGINNING
It was at 24, pregnant and married to storeowner Sam Hochberg, that Katz went into business. Hochberg was just starting out with two retail shops and the couple needed extra cash to make ends meet. But she did not want to leave home and a new baby.
She used $2,000 in wedding gift money to get a supply of leather belts and purses of her own design from her father, placed a $495 ad in Seventeen magazine, and settled down at her kitchen table to begin selling them through the mail.
Even so early in the game, her golden gut showed. She liked to see her name on things. Reasoning if she did, others did too, she offered free monograms on each matching belt and purse. Free monogramming continues to be a Lillian Vernon tradition. ”People who aren`t into the Guccis and muccis like to have their own initials on things,” she explained.
Three years later, as chief of Vernon Specialties (so named because she then lived in Mt. Vernon), Katz mailed a 16-page black-and-white brochure to 125,000 customers. That first, crude catalogue also offered combs, cuff links and collar pins.
Her husband joked that if her business netted more than $40,000 a year, he would close his retail store and help her. In 1956, he did. Eight years later, Katz incorporated and changed the name of the firm to Lillian Vernon Corp. Today, she oversees the company from Mt. Vernon with the help of her sons, Fred Hochberg, executive vice president and chief operating officer, and David Hochberg, vice president of public affairs.
Business couldn`t be better. The firm expects a 10 percent growth in sales this year despite disruptions caused by the move of warehouse and distribution operations to a new, highly automated building in Virginia Beach, Va.
AT THE FOREFRONT
Katz summed it all up as she hurried out of the restaurant and toward the elevators: ”I`m a collector. I entertain a great deal. I love movies. I read a lot. I travel. I love clothes. I love jewelry. I LOVE JEWELRY. I buy a lot of that. I cherish my girlfriends . . . I think it`s exciting to be the forerunner of a trend. I love restaurant food . . . And I would like to be a life enhancer. I`d like to feel that I`ve benefited someone.”
In the lower lobby of the Drake Hotel, her eye caught a toy cat in a shop window. She dashed into a nearby flower shop to ask about the cat. Then, spying something more interesting past the gladioli and the roses, she paced quickly to a tub of wooden puppets.
”I`m going to get one of these. For ideas,” she said, picking out a $6.50 puppet and examining it with a practiced eye. ”But she`s ugly. We`ll do a prettier one . . . ”Maybe we will. Maybe we won`t,” she said, and, clutching the puppet, dashed up the stairs toward the sunlit doors. –
