Greeting cards keep pace using varied prices, contemporary themes

Drug Store News, May 17, 1999 by Allene Symons

Consumer ad campaigns for American Greetings and Hallmark emphasized different approaches last year, when Hallmark emphasized its affordability and then followed up with its "Why not?" campaign this year. American Greetings, in the fourth quarter, launched its "American Greetings ...Says it Best" campaign, with cards tipped on full page ads in major magazines.

Apart from the consumer message, all manufacturers faced pressure by major drug chains to increase productivity last year.

Major chains tested new greeting card merchandising concepts in 1998, made easier by the fact that more drug chains now have split control or two vendors, largely due to acquisitions. Last year, for example, Rite Aid (which has both AG and Hallmark due to its acquisitions of Thrifty Pay-Less, Harco and K&B) started a pony race between test-store departments from American Greetings and Hallmark: The reward to the winner will be a greater presence in the chain.

In an effort to rev up its response to a changing market, American Greetings recently announced that it plans to get more relevant card designs into stores faster. To accomplish this, the company said it will reduce the time between designing new products and shipping them to retail.

In other social expressions segments--party goods and gift wrap--party goods didn't fly off the shelves, retailers said, noting that this segment is largely a convenience offering in drug chains due to lack of space. Gift wrap, on the other hand, continued its strong performance in 1998 for many chains.

What about greeting cards in cyberspace? E-greeting card revenue bypasses retailers, but that doesn't rule out synergy. In 1998, for example, CVS and American Greetings linked web sites so a CVS customer can choose to purchase a greeting card on the Internet. It may not sell a card in the store, but it reminds the web surfer that CVS is a greeting card destination--and retailers and manufacturers agree it's an important way to foster the greeting card exchange habit.

                          Greeting card sales [*]

Year             $ sales in billions
1998 (projected)        $7.5
1997                     7.3
1996                     6.8
1995                     6.3
1994                     5.9


(*.)All channels
Source: Greeting Card Association

                        Top 10 card seasons in 1998

                   Number of
Seasons           units sold
                  in millions
Christmas           2,600
Valentine's Day       900
Mother's Day          150
Easter                120
Father's Day           95
Graduation             60
Thanksgiving           30
Halloween              25
St. Patrick's Day      15
Jewish New Year        10


Source: Greeting Card Association