The Internet with growing electronic commerce is regarded as a new selling channel for retailers. Online catalog organization has become an important issue for e-tailing business development. While most online retailing web sites provide assistance for searchers who know exactly what they are seeking, little has been done to aid browsers who take a more open-minded and exploratory approach to navigation. Good design of online catalogs is essential for browsers to shop over the web. In this paper, we propose a two-phase approach to the design of online catalogs. In the first phase, the idea of category management that analyzes customers¡¦ purchasing behaviors is employed to construct a customer-centered online catalog. Cluster-based market segmentation helps determine the web hierarchy with clusters of products in higher levels indicating more interesting to customers. The second phase is to dynamically adjust the hierarchy when customers¡¦ preference indicated by browsing patterns is changed.'Relative access' that reflects the popularity of web pages is used as a basis to make online catalog adaptation. Finally, we apply this approach to real-world data collected at Galleze.com by Blue Martini Software. It shows that our approach can result in meaningful online catalog organization for customers to navigate. Our study therefore provides a good direction for researchers in designing online catalogs. Furthermore, e-tailing practitioners can apply our approach easily and gain benefits from such a design.