Colony Brands’ Baumann guides venerable catalog retailer into the digital age

There was a time in America when corner groceries dotted the urban landscape, quarterbacks called their own plays, and family breadwinners worked at the same company for their entire careers.

That hardly happens anymore. Indeed, in an age when the average employee can be expected to work 10 or more jobs in his or her lifetime, John Baumann is an outlier among the outliers.

“From my standpoint, the paper catalog will always be an important part of our business.” — John Baumann, CEO, Colony Brands

The Colony Brands CEO has worked at precisely one company, thank you, and he doesn’t seem to be entertaining any plans to move on. In fact, his tenure at Colony Brands goes all the way back to 1984, when he was a summer intern for the then-Swiss Colony.

“Anytime during my career I’ve had a notion of leaving, that was quickly extinguished because there has been a lot of opportunity here,” said Baumann, who will speak on June 25 at the Madison Concourse Hotel as part of IB’s Icons in Business series. “A lot of good things have happened, and if I look at why I’ve stayed here as long as I have, it’s because I’ve been surrounded by great people and it’s been a very, very supporting culture.”

But while he no doubt has a lot of fond memories to look back on, Baumann can hardly afford to live in the past. His industry is threatened more than most by disruptive technology, and despite the quaint, Old World allure of a brand like The Swiss Colony (which still operates under Colony Brands’ umbrella), the modern world is constantly providing a reality check.

Big online retailers like Amazon.com would no doubt love to carve up old-school catalog retailers like a Christmas fruitcake, but the Monroe-based Colony Brands, which pioneered the food catalog business back in 1926, remains relevant, even as it adjusts to the shifting sands beneath its feet.

And having stability at the top spot (Baumann has been president and CEO of the company since 1996) surely hasn’t hurt. In his IB Icons presentation, Baumann will talk about the history of The Swiss Colony and Colony Brands, the company’s culture, and how that culture has helped the company weather business disruption over the years.

One of the biggest upheavals in the past few years was a rebranding effort in 2010 in which the company changed its name from The Swiss Colony to Colony Brands, Inc. For Baumann, that move was largely geared toward recruiting young talent and staying relevant in the eyes of millennials.

“We’d diversified quite a bit, and we came to the realization that by working under the umbrella name of The Swiss Colony people didn’t really have an understanding of all that we did here,” said Baumann. “In today’s fast-moving, competitive environment, we need to be able to recruit some very talented young people, and those talented young people did not understand what The Swiss Colony was.

“Under our umbrella here, we have 15 different catalogs and Internet retail businesses. We’ve got a manufacturing arm, we’ve got a wholesale arm, we’ve got a consulting arm, and we’ve got an aviation business, so there’s a lot going on here, and putting the name Colony Brands out there just helps us to open up that dialogue a little bit.”

Battling giants

Of course, in an age when online retailers like Amazon are top-of-mind for consumers who crave instant gratification, competing in the Internet and mail-order retail space requires a fair degree of savvy.

“No question about it, Amazon is a giant competitor and they’re very formidable,” said Baumann. “They have a great selection of product, they’re very quick with their shipping, and from a database perspective they really do a bang-up job. … But from a customer service perspective, we’re in pretty good position to give that personal touch to our customers, and we’re very, very easy to access by the phone or Internet. Our employees who work in our call centers have a very good command of our catalog business and the products that we sell, and there’s a certain personal element that we can put into a transaction with a customer that Amazon can’t, and we really have to hang our hat on that to a large degree.”

Baumann says that Colony Brands also sets itself apart from online retailers through the breadth of its offerings. Today, its signature mail-order food brand, The Swiss Colony, makes up only about 10% of its total business.

“That breadth comes in the different catalog brands that we have, which is also another form of differentiation from an Amazon,” said Baumann. “Amazon is basically one gigantic site. We’ve got 15 different catalog retail businesses, all with different brands, all with a little different feel, a little different selling proposition, and that gives us a little separation as well.”

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As consumers transition more and more to online shopping — including through Colony Brands’ sites — it may look like the catalog business is destined to go the way of the five and dime, but Baumann believes the paper catalog will remain an integral part of Colony Brands’ success for the foreseeable future.

“From my standpoint, the paper catalog will always be an important part of our business,” said Baumann. “If you look at the most cost-effective means of communicating with and/or recruiting a new customer, the paper catalog is still the most efficient way to do that. Now, the catalog industry as a whole is, I’m going to say, suffering from the advent of the Internet. You find a lot of old-line cataloguers just can’t compete anymore. One, because younger consumers are just not prone to shop from paper catalogs, and you’ve also got the postage costs that continue to rise faster than inflation, and that makes it really difficult for a lot of smaller paper catalog-based businesses to advance.

“In our particular case, we are trying very hard to stay viable by constantly updating our website and reviewing how we communicate with our customers. And certainly we’re trying very hard to gain a strong foothold in the mobile market, and that’s going to be very important for us going down the line.”

But unlike some of the fly-by-night operations that littered the landscape following the 2000 dot-com bust, Colony Brands is a privately held company with a strong company culture (and a longtime CEO) that’s survived a Great Depression, a Great Recession, and numerous other downturns. As such, it’s largely allergic to the kinds of decisions that are made for short-term gain at the expense of long-term stability.

“In some respects, because we are a business that emerged in the 1920s that’s still controlled by the same family, it may look like we’re some sort of throwback,” said Baumann, “but I think what’s really helped give us that staying power is that we do have a very strong value-based culture here. From a business perspective, we are mindfully opportunistic. We are always looking for ways that we can grow, but we don’t jump too quickly.

“We really study the opportunities that are in front of us. Especially in the direct marketing business, we have a lot of data that we can use to test a lot of different things. And we test a lot; we measure a lot. We test, test, test, measure, measure, measure, and that has served us very well, because most of our growth has come organically.”

If you would like to see Baumann speak at the June 25 Icons in Business event, click here for information on registration and event details.

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