Calyx Flowers : Managing Profitable Growth Recommendation : Increase Internet advertising. There are several reasons to support it. 1. Less Cost‚ more tailored communication with customers In case of the catalog‚ the acquisition cost of new customer is too expensive. This makes new customers unprofitable. (see table 1) Instead of the catalog‚ the company can send email directly to their target customer with less expense. The company already have a web page‚ so the firm can use the system without
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freshness‚ and price. Our customers are 57% women between 30-55 years of age with high disposable income who want to send not only flowers‚ but love. Calyx offers our customers premium mail-order gifts. We differentiate ourselves from competitors (FTD‚ 1-800-Flowers.com) by delivering our product directly from growers to customers‚ ensuring we offer the freshest flowers with the most longevity. Problem Identification: The Awareness Gap While we have gross margins of 50%‚ and a premium product compared
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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.
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Calyx Flowers case analysis Calyx Flowers is relatively new company (under new management) in the fresh flowers market. They have pioneered the concept of selling fresh flowers by mail. During the years they established a strong relationship with Federal Express‚ their primary distributor. The main issue: How to increase the financial performance of Calyx Flowers through marketing and thus enlarging
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been in frequency of mailings rather than in customization of product offerings‚ pricing‚ or messaging in response to their varying values. There is no evidence in the case that demonstrates that they understand what attributes their customers’ value most. It appears that Calyx Flowers has positioned themselves as a premium flower retailer by establishing an average price of $80‚ not including delivery. Presumably this premium price is justified by providing superior freshness and longevity by cutting
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Decision Mr. Gilbert‚ CEO of the Vermont Teddy Bear Company is going to choose a strategy for Calyx Flowers‚ one of its subsidiaries‚ in order to reach the full financial performance. There are three possible options proposed by marketing team: ‘Increase the number of catalogs’‚ ‘Increase mass-media advertising’ and ‘Increase Internet advertising’ I strongly recommend that Calyx Flowers choose ‘Increase Internet advertising’ option. I believe this option could not only be compatible with the company’s
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Chernev. Professor Alexander Chernev (Kellogg School of Management‚ Northwestern University) prepared this case solely as the basis for class discussion. This case is not intended to serve as an endorsement‚ source of primary data‚ or an illustration of effective or ineffective management. The data presented in this case have been modified and should not be used beyond the scope of a case discussion. To request permission to reproduce materials‚ e-mail permissions@marketingcases.com. No part of
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Situation Overview: Calyx Flowers‚ a subsidiary of the Vermont Teddy Bear Company has struggled reaching its full potential despite gross margins of 50%. To improve financial performance of Calyx Flowers‚ the Marketing team has identified three action plans. 1. Increase the number of catalogs 2. Increase Mass Media Advertising 3. Increase Internet Advertising Action Overview: To solve the above problem the company should implement the strategy of “Increase in Mass Media Advertising”
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strength of the Calyx & Corolla formula is that they enhance the delivering speed so that customers get fresher flowers. Also‚ it lowers the cost of delivery from growers to C & C‚ from wholesellers to retailers‚ and from retailers to customers. But there are also problems in the formula. For example‚ it is hard to control the quality of the products. C & C has to monitor the growers and Fed‚ and spend extra money to maintain the high quality of the products. 2. Calyx & Corolla
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Calyx & Corolla Case Strength: Management Team Ruth Owades- HBS graduates‚ CML Group former director of marketing in retail and direct mail business; successful launched “Gardener’s Eden” under Williams-Sonoma‚ a direct mail business focused on garden implements and accessories. Through her great understanding of direct mail flower business‚ she maintained great relationships with both Growers and Federal Express‚ including growers training and negation on deliver method such as online-tracking
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