Calyx flowers
Calyx Flowers: Managing Profitable Growth
This analysis focuses on Calyx Flowers, a subsidiary of Vermont Teddy Bear Company. It is a flower delivery service that ships fresh flowers direct from 18 growers in Florida and California. This permits Calyx & Corolla to provide fresher, longer-lasting flowers to consumers. This distribution channel gives them an edge over other conventional companies like 1-800-FLOWERS.COM and FTD. This also helps them to sell them at premium with 50% gross margin. In order to have a wider variety of flowers, some of them are flown in from farms in Ecuador, Columbia, and Holland to growers’ warehouses in US. Calyx also provides vases and other floral accessories in addition to flowers. They also have continuity programs wherein you can subscribe for a monthly delivery of flowers for a year. Calyx & Corolla appears to have a strong potential for a bright future, but the company also have some apparent weaknesses in their business.
Calyx Flowers promoted its offerings primarily through the ten million catalogs. Of the 10 million, 5 million goes to prior customers, 2 million goes to flower recipients and 3 million goes to potential customers. This is very inefficient considering the cost of $2.2 1million for sending out 3 million catalogs to acquire new customers. And this group yield was only 1% per mailing. Effective and cost-efficient segmenting can help Calyx to optimize their marketing expenditure. Value based segmenting helps Calyx to identify the customer groups based on their needs and benefits they seek from Calyx. Freshness, longevity of flowers and speed of delivery are the core competencies of Calyx. They will have to identify the customer group that values these qualities through strategic positioning. Through value-based segmenting 2and strategic targeting3, Calyx should expand size of potential customer base and Increase brand awareness. Calyx has positioned themselves as a slightly upscale provider of flowers vs. the
This analysis focuses on Calyx Flowers, a subsidiary of Vermont Teddy Bear Company. It is a flower delivery service that ships fresh flowers direct from 18 growers in Florida and California. This permits Calyx & Corolla to provide fresher, longer-lasting flowers to consumers. This distribution channel gives them an edge over other conventional companies like 1-800-FLOWERS.COM and FTD. This also helps them to sell them at premium with 50% gross margin. In order to have a wider variety of flowers, some of them are flown in from farms in Ecuador, Columbia, and Holland to growers’ warehouses in US. Calyx also provides vases and other floral accessories in addition to flowers. They also have continuity programs wherein you can subscribe for a monthly delivery of flowers for a year. Calyx & Corolla appears to have a strong potential for a bright future, but the company also have some apparent weaknesses in their business.
Calyx Flowers promoted its offerings primarily through the ten million catalogs. Of the 10 million, 5 million goes to prior customers, 2 million goes to flower recipients and 3 million goes to potential customers. This is very inefficient considering the cost of $2.2 1million for sending out 3 million catalogs to acquire new customers. And this group yield was only 1% per mailing. Effective and cost-efficient segmenting can help Calyx to optimize their marketing expenditure. Value based segmenting helps Calyx to identify the customer groups based on their needs and benefits they seek from Calyx. Freshness, longevity of flowers and speed of delivery are the core competencies of Calyx. They will have to identify the customer group that values these qualities through strategic positioning. Through value-based segmenting 2and strategic targeting3, Calyx should expand size of potential customer base and Increase brand awareness. Calyx has positioned themselves as a slightly upscale provider of flowers vs. the
References: 1. Calyx flowers: Managing Profitable Growth, Alexander Chernev 2. Strategic Marketing Management, Alexander Chernev