Calyx & Corolla Case

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Promotion and Marketing

More than 70% of the revenues of Calyx & Corolla were derived from directly from the catalogue while 20% were derived from promotional tie-ins and corporate customers. The remaining 10% came from telemarketing efforts to previous flower customers and recipients.

The marketing and promotional effort of Calyx & Corolla comprised of a three main components – (i) Catalogue which was the most important channel of communication with its customers. Besides dispensing information on the range of products and respective costs, the catalogue included information such as education trivia, arrangement suggestions, etc. While the response rate was higher was existing customers (5-10%), for customers approached from various mailing lists, it was considerable lower (1-2%), (ii) Tie-ups and partnerships for promotional programs with corporates that shared a common theme for an upcoming event or occasion – such as a joint program with Bloomindale to promote their vases on Mother’s Day, program, program Smithkline Beecham for a Mother’s Day promotion of caplets for allergy relief, (iii) Public Relations Initiatives which included coverage for Calyx & Corolla in publications such as The Wall Street Journal and International Herald Tribune. Such promotional coverage had led to acquisition of both catalogue and corporate customers. Some of the other initiative included space in catalogues of major retailers and affinity Group Promotions, offering discounts to members of various organizations, etc. On the other hand, the established players in the industry relied on traditional channels such as TV, newspapers, radio, etc. to reach out to consumers. For example, FTD spent 73% in TV, 14% in Newspaper, 8% in Network Radio, and 4% in other.

In the current age, the company will have to relook and revitalize its marketing strategy. The efforts will have to move from a promotion of product features to a branding exercise because, even though the products are evolving, the competition is much more intense and is catching up quickly. The multi-channel customer that wants a broader product with more features is able to relate on the brand side as a proxy for the promise of the benefit provided by those features.

While in the growth phase the focus is on product features, and while in the maturity stage it’s about how the brand ensures a repeatable experience. While in the growth stages, the company relied on word of mouth to a large extent as it challenged the more established players as a new entrant, now it is important to follow a multi-channel strategy. Moreover, in the present age, the marketing strategy for Calyx & Corolla cannot ignore the role that digital media plays in influencing customer behavior. The Company’s model is no longer unique and cannot expect any gain from newspaper coverage.

The Company will need to create its footprints across social media such as Facebook, Twitter, Tumblr, Pinterest, etc. These platforms can facilitate two-way communication between the company and its customers. Besides sharing information on products, schemes, and promotions, these channels can help the company share satisfactory experience of one customer can be used to influence sales of other customers. With respect to the content, while more updates would be required, the matter would remain the same. The company can share similar product information, arrangements suggestions and educational trivia, which was earlier included in the catalogues. Calyx & Corolla must allocate its resources in a variety of channels – digital, print, television and radio with an overall push seasonally. The company will also have to leverage their database of customers, which includes preferences and purchasing patterns. Using data analytics, the company will have to forecast the needs of its customers.

As the market has matured, price becomes the primary concern, as it does in a commoditized market, and we need to weigh the rest of the resources almost equally because we are fighting with competitors to retain our customers on every front, because the differentiation is less and less and the broadening customers are being marketed to through multiple channels and have a variety of uses. These changes are necessary because the first mover advantage can never be the only source of a competitive advantage as it will only last during the early stages. We need to constantly be evolving our marketing mix and resource allocation in order to maintain competitive advantages and retain our unique position in our segment as well as identify and create other new segments as the appeal of the product broadens.