The federal budget’s in the red, Layoffs are making me blue, But that won’t stop me From buying a Valentine’s Day gift or two
Consumers didn’t let a lack of encouraging economic news keep them from buying gifts for their loved ones this past Valentine’s Day. Indeed, every one of the more than a dozen mailers who spoke to Catalog Age reported a surge in Valentine’s Day sales compared with last year.
Granted, just as many catalogers refused to divulge their results — and generally speaking, companies that are doing well tend to be more eager to talk than those that aren’t. But February sales reports from publicly traded retailers support the solid increase in Valentine’s Day sales.
For instance, February revenue for the catalog division of Neiman Marcus Group (the upscale Horchow, Chef’s Catalog, and Neiman Marcus titles) rose 9%; for Limited Brands’ Victoria’s Secret Direct division, 13%. Multititle marketer 1-800-Flowers.com reported record demand from Jan. 27 to Feb. 14. Among its brands, which include toys catalogs HearthSong and Magic Cabin Dolls and food gifts title The Popcorn Factory, the Westbury, NY-based company fulfilled more than 1 million orders.
And according to Internet research firm ComScore Networks, online spending from Feb. 2 to Feb. 11 in Valentine’s Day-related categories such as flowers and gifts increased 49% over the comparable period of 2002.
“People are just starting to spend more money,” says Tony Cox, president of Catalog Solutions, a Richardson, TX-based consultancy that works with food catalogers. “Consumers are beginning to open up their pocketbooks.” The food mailers from whom he saw results reported an average Valentine’s Day revenue increase of 15%.
Margaret Hartnett, catalog/marketing manager for food gifts mailer Wolferman’s, believes that uncertainty about Iraq had put a damper on Valentine’s Day sales last year. The Shawnee Mission, KS-based cataloger estimates that its February sales were 54% higher than for February 2003, on a 30% increase in circulation, to 338,000 copies.
Geopolitics aren’t solely responsible for the improved sales, of course. Hartnett, for instance, also cites improvements to Wolferman’s creative. The cataloger had added an inch to the width of the catalog in the fall and updated the page layouts to include more full-page “hero” product shots.
As for the front cover of the February edition, it “was better than we ever had,” Hartnett says. Wolferman’s signature English muffins rested atop a glass pedestal, propped with a chocolate-covered strawberry — “very romanticized,” Hartnett says.
Another food mailer, Savannah Candy Kitchen, also credits a creative change for much of its sales growth. The Savannah, GA-based cataloger/retailer added a four-page outer wrap featuring Valentine’s Day-specific products to its 36-page catalog.
This was the first season that the company created merchandise specifically for the holiday, says president Stan Strickland. Top sellers included a Valentine’s Day basket featuring an assortment of candies and a 1.5-lb. chocolate heart that could be personalized. Although circulation was flat with last year, Strickland says direct sales rose 17%, while sales among the company’s three stores increased 10%.
In time for Valentine’s Day, the Website of cataloger/retailer J.C. Penney Co. promoted its “build a diamond engagement ring” feature. Soft-launched in the fall, the feature allows shoppers to mix and match stones and settings, offering 150,000 variations in all. The made-to-order ring is delivered within one week. While the Plano, TX-based general merchant won’t disclose how much revenue the rings generated, it did report an 8% rise in February catalog and Internet sales, to $188 million, exceeding expectations.
The Vermont Teddy Bear Co. also promoted a special Valentine’s Day product: the Playbear Playmate. Dressed in a satin suit, white cotton tail, and cuffs like the original Playboy Bunnies, the bear sold for $99.95.
Although it won’t release sales figures, the Shelburne, VT-based marketer says it shipped 27% more orders this Valentine’s season than last year’s. Its approximately 140,000 holiday orders included 12,500 orders from fresh-flower cataloger Calyx & Corolla, which Vermont Teddy Bear bought in August 2003.
Vermont Teddy Bear wasn’t the only marketer to use a teddy in a Valentine’s Day promotion. On the back cover of its February catalog, North Kansas City, MO-based Helzberg Diamonds offered a teddy bear with the company’s trademarked “I am loved” slogan free with any purchase. A portion of the proceeds went to the Elizabeth Glaser Pediatric AIDS Foundation, says John Goodman, senior vice president of marketing and customer service for Helzberg. The jeweler, which uses its catalogs largely to drive traffic to its 250 stores, had “very strong sales,” Goodman says. “It was a continuation of a strong December.”
Palm Beach Jewelry touted a free-shipping promotion on the front of its Valentine’s Day catalog. But Fred Neil, vice president/general manager/president of catalog for the Boca Raton, FL-based mailer, says that “better targeting” is the reason for much of its double-digit sales growth: “We had better productivity out of our prospecting segments. We developed some new response models.”
Bridgewater Chocolates, a Bridgewater, CT-based cataloger/retailer, credits much of its sales increase to its first-ever television commercial, which aired throughout its home state 8-10 days before Valentine’s Day. “Before the ad came out, we were 16%-18% higher than last year,” says co-owner Erik Landegren, “but as the ad came out, we jumped to over 30%.”
Bridgewater aired its spot locally only, says Landegren, because Valentine’s Day is the only holiday for which shopping is dominated by men. And since men are less likely to shop well ahead of time, he continues, they have no alternative but to turn to a local store or direct marketer that can deliver at the last minute.
Helzberg Diamonds also kept last-minute male shoppers in mind when creating its marketing plan. “Last-minute e-mail proved very effective,” notes Goodman. “The company sent the men on its e-mail house file one message a week before Valentine’s Day and another several days prior. “The e-mail reminded them of the gift opportunities and the site links so that they could go online to see the gift options,” he says.
“More aggressive” e-mail and online marketing contributed to the 17% rise in sales at Annalee Country Gift & Christmas Shop, says Ron Snyder, director of business services. The Meredith, NH-based company sent e-mail newsletters and promotional e-mail blasts to its house file. The home page of the Website spotlighted Valentine’s Day merchandise as well.
Personal Creations, a Burr Ridge, IL-based gifts cataloger, sent three e-mail messages prior to the holiday. The first message, sent four weeks before Valentine’s Day, “focused on our whole assortment of Valentine’s Day items,” says Geoffrey Smith, president of e-commerce and new business development. The second e-mailing, which offered a free upgrade to expedited shipping, was “targeted to everyone in the house file who had yet to purchase for Valentine’s Day.” The third e-mail was sent on the Monday before Valentine’s Day.
Personal Creations’ Valentine’s Day sales were up in the “single digits” from last year’s, Smith says, “mainly because of the growth of our online business. Valentine’s is a real last-minute gift-giving holiday, and the Internet is the perfect medium for that.”
A victim of success
Jeffrey Badler, president of Maurice Badler Fine Jewelry, does express some disappointment with his company’s Valentine’s Day business. It’s not that sales were down. “This was our best Valentine’s ever,” he says. “We were deluged with orders.”
But the the New York-based cataloger/ retailer’s fourth quarter had been so strong that its inventory was still depleted and “for some major products there wasn’t anything to be had” as far as getting product from vendors, Badler says. “So as well as we did this Valentine’s, if the vendors could have kept up, we’d have doubled what we did — we lost that much.” — Reporting by Mark Del Franco, Paul Miller, Regina Ryan, and Margery Weinstein