Strategy and Positioning at Calyx and Corolla Kung Ciao Ken Otani Seema Sangari Donald Smith James Sun
Project Goals • Understand and interpret Calyx & Corolla’s marketing plan, in order to provide strong recommendations.
Industry $9B annual sales 7.7% sales growth Fragmented, with multi-tier markup Traditional model: Growers Distributors Wholesalers Florists Consumers C&C $10.3M annual sales 255% sales growth Unified purchasing New model: Growers Consumers Bypass distribution layers, combining FedEx and catalogue sales 1990 Vital Statistics
Choosing the Value • “We FedEx the freshest and finest cut flowers directly from growers to customers on any specific day.” • Competition • Retail florists • Wire services (FTD) • Grocery store floral department • Perception Map • Target segments: • Corporate buyers • Existing retail florists customers • Longevity care prospects
Choosing the Value • “We FedEx the freshest and finest cut flowers directly from growers to customer on any specific day.” • Meaningful • Provides value that competitors lack. • Different • Convenient, fresh-cut flowers, overnight delivery. • Deliverable • Flower loving employees, FedEx service, and the best growers. • Convincing • Detailed Satisfaction Guarantee
Providing the Value • Risk free transaction • -Exact day delivery service • -Personalized handwritten card • -Care card • -800 plant doctor line • Streamlined Channel distribution • Growersdistributorswholesalersretail floristsconsumers • Growersconsumers • -See value?
Communicating the Value • Direct Mail catalogues • Promotions and incentives • Corporate Gifts • Press Releases • Telemarketing • Joint marketing product tie-ins
Issues Existing C&C marketing plan has limitations. • Low response rate • Response rate 1-2% for rental list • Response rate 5-10% for prior customers • High catalog and rental mailing list costs • 12,000,000 catalogs x $.40 ea
Recommended Action Items • Develop corporate tie-ins • Must be mutually beneficial and profitable • Invent unique selling strategy (e.g. Bloomingdale’s vase + Flower Gifts) • Develop mailing list exchange program • Increase sales force and customer services • Friendly and knowledgeable services • Build and maintain long-term relationship (repeat orders) • Maximize media attention instead of TV advertising • Maintain niche position in industry • Focus on brand image as “fresh flowers”