San Francisco Music Box Co.’s New Parent

As a noncore division of athletic shoes cataloger/retailer Foot Locker (formerly the Venator Group), The San Francisco Music Box Co. (SFMB) was pretty much left alone. Now its new parent, New York-based Kier Group Holdings, not only plans to grow the business, but it also expects the cataloger/retailer of music boxes and other gifts to act as the basis of a stable of multichannel marketers.

Kier Group, a private investment firm, bought Walnut Creek, CA-based SFMB on Nov. 13. The sale was part of Foot Locker’s planned divestiture of its nonathletic businesses. Catalog sales make up about 15% of SFMB’s overall sales, but looking forward, “direct marketing may grow faster than retail,” says Joel Kier, SFMB’s new chairman. “Our investment is about growing the business and enhancing and improving” the catalog division, though Kier won’t reveal specific plans. In addition to the print and online catalogs, SFMB has a 162-store retail chain. Kier says that other than taking over the top spot, he doesn’t plan to make any management changes at SFMB.

SFMB is Kier Group’s first direct mail catalog acquisition. The holding company does own Britain’s Open Invitation from House of Lloyd, which uses sales agents to sell via its catalog — a model comparable to that of Avon and Tupperware in the U.S. Kier Group is looking to buy additional U.S. multichannel marketers. “We see a real opportunity to use catalogs in a way that enhances store and online traffic,” Kier says.

As for SFMB’s former parent, although it has exited the gifts business, it is still involved in cataloging. In addition to its 2,700-store Foot Locker chain, the company owns the Eastbay catalog of running gear. Selling off SFMB, Foot Locker president/CEO Mathew Serra said in a statement, “will allow our company to go forward with our resources totally focused on our athletic footwear and apparel formats.”

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