...optimal target segment and (2) develop a marketing mix that effectively and efficiently reaches this segment. To reach this segment, Calyx should advertise through print media outlets whose readership values Calyx’s unique offering, namely flower longevity and freshness, and continue to pursue in-store promotion opportunities with select home décor retailers and upscale department stores. Problem Analysis Segmenting the market by looking solely at the demographic and geographic characteristics of its existing customers has led Calyx to believe that it can expand its customer base by simply sending catalogs to individuals who share similar demographic profiles. However, the large discrepancy in yields between current customers and those who were obtained from rented mailing lists (Exhibit 2), highlights the fact that Calyx is not effectively reaching the customer segment that most values its services and is unprofitable due to excessive catalog spend. In order to guide the process of identifying Calyx’s target segment and proposing alternative methods to reach this segment, we have constructed the following positioning statement: To those who value flowers for decorative purposes, Calyx is the distributor of flowers and plants that are fresh and long lasting, because of our direct relationships with flower growers and Federal Express. Calyx should focus its segmentation efforts on targeting customers who value what is unique about its service. Based on the value proposition...
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...A Case Analysis of Calyx and Corolla This analysis focuses on the case study of Calyx & Corolla, a mail order flower company. Calyx & Corolla is a relatively new company that utilizes a different distribution channel than conventional companies for fresh flowers. Calyx & Corolla mails flowers direct from the growers to the customers via Federal Express and eliminates the middleman (Appendix A). This permits Calyx & Corolla to provide fresher, longer-lasting flowers to consumers. The management of Calyx & Corolla is contemplating a change in their long-term business strategy as they examine their ability to compete with more traditional outlets such as retail flower shops and wire services like FTD. Ruth Owades, the founder of Calyx & Corolla, has hired Marketing Consultants (MarCo) to assess the strengths and weaknesses of her business and make recommendations on how her company can fully develop their mail order concept. Background: Calyx & Corolla is a small mail order flower company that was founded in 1988 by Ruth Owades. Ms. Owades secured $2 million in capital from approximately 18 different investors in order to launch the company. By 1991, Calyx & Corolla exceeded $10 million in annual sales and Owades and her associates were reassessing the firm's long-term growth strategy (Wylie and Salmon, 1991). Up to this point, Calyx & Corolla was primarily a mail order company, but management is now considering expanding their market and is...
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...terms of the various benefits provided and then bundling the individual components with other complementary products. (ii) So as to increase the awareness of the different TiVo products and the brand, we propose to segment the market in terms of the specific customer profile whose needs are aligned to the particular benefit provided by the product. Accordingly, we arrive at a communication plan for the different TiVo products that target different customer segments through a mix of advertising, promotion, distribution and branding strategies. In the following section, we analyze the situation that Tivo is faced with and follow it up with the logical sequence that helped us arrive at the above recommendations. Company Analysis Calyx and Corolla is a new company in the fresh flowers market. They have pioneered the concept of selling fresh flowers by mail. In its short lifetime, C&C has established strong relationships with many large growers, who cut flowers when ordered, thereby increasing the life of the buds tremendously over typical florist shops whose buds may already be a week old when purchased. They have also developed a strong relationship with Federal Express, who is their primary distributor. Federal Express has a well-established brand name, known for speedy, on-time, and reliable delivery, giving C&C’s promise fro freshly delivered flowers credibility among customer who are unfamiliar with...
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...Calyx & Corolla 1. Gap in market structure 2. Strengths/Weaknesses 3. Strengths and weaknesses of Calyx and Corolla versus a conventional retailer? 4. Markets/Benefits (recall class discussion) 5. What are they missing out on? Are they under-marketing? 6. Is Database Marketing the same as Direct Mail? How is database marketing different from conventional mass marketing? 7. What should Calyx & Corolla (C&C) do? Market Structure 1. Why does the gap in the market for C&C arise? 2. Long distribution channel Grower $5 ( Distributor (50% markup) ← $7.5 Wholesaler (100% markup) ← $15 Florists (150% 59 200% markup) $37.50 to $45.00 3. - Perishability/Freshness a critical business dimension - Stock at store seven days old on average - “Fresh” flowers have a premium Strengths • Freshness: • Longevity: (longer house life) • Information: Catalog provides information about flowers not available with an FTD florist • Information on arrangement/care • Suggestions on vases/display accessories • Variety: 30 geographically dispersed growers • Personalization: Hand-written card • Database: • Focus on lifetime value • Acquisition then retention • Dialogue with consumer Weaknesses - Flowers arrive in a bland FedEx package - May not be in full bloom on receipt - Unable to provide Sunday delivery - Vulnerable to bad weather - Have no consultation...
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...Calyx and Corolla Case Report Introduction Calyx & Corolla was a new entrant into the $8 billion flower industry in the United States in 1991. Through the use of overnight air freight (Fed Ex), information technology, an 800 number, and a catalog, Calyx & Corolla was able to bypass three layers of distribution and provide fresh flowers directly from growers to consumers. As a result of their efficient distribution system, Calyx and Corolla changed the way flowers were distributed to consumers. Strengths and Weaknesses I. Strengths A. Good niche and mission. Calyx and Corolla filled a consumer need. Consumers wanted very fresh and long lasting flowers and the company delivered it. Efficient distribution was the key to flower industry and the company was able to shorten delivery to customers by bypassing the middle distribution layers, and provide much faster deliveries than traditional FTD deliveries. For example, Calyx and Corolla delivered roses from growers to consumers within 1-2 days of purchase order compared with one to two weeks for other FTD retailers and florists. B. Sales growing at a faster rate than cost of goods sold. Projected FY4 and FY5 also had projected sales growing faster than cost of goods sold. See graph for details (Derived from Exhibit 1). Growth rate 1988-1989 to 1989-1990 Growth rate 1989-1990 to 1990-1991 Growth rate FY3 to FY4 Growth rate FY4 to FY5 Sales 4.31 1.55 .49 .61 Cost of goods sold 4.14 1.52 .42 .58 C. Good creative...
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...Calyx & Corolla Calyx & Corolla, a brainchild of Ruth Owades, was a phenomenal success owing to an innovative concept involving a direct delivery of plants and flowers from growers to consumers, eliminating all middlemen such as florists, shopping malls and other distributors. While Ruth Owades’ model has worked beautifully, it is imperative to adopt new approaches to building and leading organizations to be in-sync with changing times and stay competitive. Calyx & Corolla’s year-long test advertising campaign should ideally spread out advertisements throughout the year; during non-holiday seasons as well as the peak holiday seasons. It is recommended that the campaign kicks-off with an approaching holiday because this is the time when people look for promotional offers, discounts etc. This is the time they start evaluating different deals on offer, and making comparisons. Just before a holiday is a good time for Calyx & Corolla to focus aggressively on advertising. These are the times when sales volumes are high and consequently, the chance of delivering a low quality product is high from less care in mass production. If Calyx & Corolla manages to deliver high quality during holidays, it would gain a lot of credibility among customers and recipients alike. People would always remember how fresh and beautiful the flowers from Calyx & Corolla were. It would have a longer lasting impact on their minds. The following are other recommendations for Calyx...
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...Calyx and Corolla: Case Study Write-up Prepared by: Group 3 Brendon Jordan Krystal Juren Matt Leslie Andreas Rudin University of Florida Gainesville Executive Summary Tivo’s new consumer electronics product has the potential to revolutionalize media consumption habits and the structure of the television industry. The key challenges include: i) how to improve the value of the product in terms of the benefit to cost ratio and ii) how to increase awareness of the brand as well as the many different product attributes. We recommend that i) TiVo improve the value of the product by unbundling it in terms of the various benefits provided and then bundling the individual components with other complementary products. ii) So as to increase the awareness of the different TiVo products and the brand, we propose to segment the market in terms of the specific customer profile whose needs are aligned to the particular benefit provided by the product. Accordingly, we arrive at a communication plan for the different TiVo products that target different customer segments through a mix of advertising, promotion, distribution and branding strategies. In the following section, we analyze the situation that Tivo is faced with and follow it up with the logical sequence that helped us arrive at the above recommendations. Company Analysis Calyx and Corolla is a new company in the fresh flowers market. They have pioneered the concept...
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...15.566 Information Technology Calyx and Corolla Case Questions Leslie Prince Rudolph 2/25/98 15.561A and 15.566 Example Case Writeup for Calyx and Corolla #1 – Value Added Chain The value-added chain for typical florists can be depicted as follows: Customers call in order growers distributors wholesalers florists consumers The distributors are typically located in the growing regions. The wholesalers are geographically dispersed. Most flowers are ordered directly from the florist and delivered to the recipient (consumer). Small family-operated companies dominate the entire chain. In many cases, industry participants have some role across the organizations (i.e. some wholesalers also grow some flowers). Mark-ups are substantial from one organization to the next, causing a resultant mark-up of almost 800% from the growers to the consumer. In contrast, the value-added chain using Calyx & Corolla’s approach can be depicted as follows: Calyx & Corolla send order info to growers Customers call in order growers Fed Ex consumers With the Calyx and Corolla approach, information travels from the customers to Calyx & Corolla, directly to the growers. The growers then package the flower orders in their final consumer packages. The flowers are transported by Fed Ex to the consumer. The Calyx & Corolla approach allows consumers to receive fresher flowers by as many as 710 days over the traditional approach. #2 – Strengths and Weaknesses ...
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...How? Advantages to Firm Advantages to Customer Value Creation C&C launched a unique flower delivery system by buying flowers directly from growers, convincing them to retail, and shipping directly to customers via Fedex. C&C’s top management nurtured one to one relationships with 30 geographically dispersed growers with onsite account support for administrative tasks (e.g. stringent packaging, top-notch handwriting) Top management team comprised of veterans in flower industry (Owades), customer service (Wilson), and catalog marketing (Hayes). Cost Focus: By incorporating value chain directly into its business process, C&C had a competitive cost advantage with COGS at 25% compared to FTD’s COGS at 60%. Minimize market fluctuations: Two-way information flow on demand and excess capacity between growers and C&C increased sales and offset seasonality for both. Barriers to entry & imitation: C&C’s exclusive contracts with growers prohibited growers from supplying to any other mail order retailer. Customer Focus: C&C delivered flowers fresher by 1-2 weeks (than conventional florists) to customers at a very competitive price. Customer Experience: C&C provided high aesthetics and stringent quality packaging besides customer awareness to amplify shelf life or décor. Positive press in leading magazines maintained and attracted customers. Value Preserv-ation C&C established a critical relationship with Fedex, a natural process “fit”, because customer perceived time...
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...Calyx & Corolla: Case Analysis Calyx & Corolla is a newly founded venture in the fresh flowers selling business. With two and a half years’ experiences and practices, it has consummated over 150,000 transactions, yielding revenues in excess of $10 million and successfully pioneered the concept of selling fresh flowers by mail. However, the managers of the company, Fran Wilson and Ann Lee, are reassessing the firm’s long-term growth strategy. Although the business achieved a huge success in such a short time, it is hard for the business to grow and generate more revenues when facing with growing challenges. Hence, the management is thinking of a more aggressive growth strategy to stimulate the business and increase the sales. In order to conclude a better strategy, an analysis of the industry would be necessary to help understand the company’s current situation. In 1990, retail flower and plant sales were almost a $9 billion business in the United States. Most of these flowers are planted domestically while several types of flowers, including carnations, roses and a variety of other flowers, are imported from other parts of the world. Although there are some large sellers in the industry, major sellers are still small, family-operated companies. Usually, growers sell their flowers to distributors. And then distributors sent flowers to different wholesalers and wholesalers then sent flowers to florists. This whole process will add a 500% to 700% markup to the final selling...
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...My suggestion: In order to attract more customers and improve their financial performance, Calyx Flowers (“Calyx”) should increase internet advertising. Argument in support: • The internet advertising requires less capital than other options do • Internet advertising allows a more targeted market segmenting and higher target reach. • Online advertising avoids expensive long-term contracts, can be placed in a short amount of time, and can be launched on demand. i.e. Calyx can run a mass of online ads in a short period of time such as before busy holidays like Valentine’s Day and Christmas even on a relatively tight budget. • Calyx could differentiate their brand and products from other major competitors who have been advertising extensively through mass-media. • Since Calyx has already received orders via their website, online advertising could make customers have a seamless shopping experience. And it could prevent customer secession and customer complaints. • Calyx could track and receive more accurate feedback through internet advertising. With the information they received, they would be able to determine whether the current marketing and advertising strategies are succeeding or not. • Calyx can collect the history of online purchases and adopt ono-to-one marketing strategies by analyzing the consumers’ behavior. So, they could pitch more personalized and effective advertisement to customers. Pros and Cons of the other options: • Increase the number of catalogs...
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...INTRODUCTION Calyx & Corolla (C&C) is a mail-order flower company that entered the U.S. flower industry in 1989 and had consummated 150,000 transactions with revenues exceeding $10 million in 1991. It differentiates from the rest of the industry in a way where a unique distribution approach was adopted. By partnering with express shipping company FedEx, C&C was able to deliver its flowers to the customers directly from growers, bypassing distributors, wholesalers and retailers in the typical channel of distribution of this industry. This special business model is not only cost-effective but also consumer-friendly as it significantly cuts production distribution time that allows customers to receive much fresher flowers. To promote sales, C&C have been using various marketing strategies such as catalog distribution, corporate gifts, joint marketing approaches with specific consumer brands, and most importantly public relations initiatives led by C&C’s founder, Ms. Owades. Through press releases on well-known magazines and journals, Ms. Owades managed to not only expand brand awareness, but also educate consumers why flowers are needed and how important they can be. Though harvested a successful start, C&C, as a newborn in the flower business was faced with an unknown future. Moreover, as it stepped into the growth stage of the business life cycle, more competitors were likely to be attracted with the same business idea. At this critical stage, a strategic marketing plan...
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...Debería internacionalizarse? Cuando el 30 de junio de 2006 (el día en que se publican los resultados financieros de 2005), Elisabeth B. Robert, consejera delegada de Vermont Teddy Bear Company (www.vtbear.com), se despertó, echó la vista atrás hacia uno de los años más significativos de la historia de la empresa: Servicio de Comida Contrate Para Su Empresa Ingrese aquí! www.chefgourmet.com.arEnlaces patrocinados El 16 de mayo de 2005, Vermont Teddy Bear anunció la firma del acuerdo definitivo por el cual la empresa pasaría a pertenecer a un grupo de inversión liderado por The Mustang Group, una empresa privada de inversiones con sede en Boston. La razón principal de este paso había sido explicada por Elisabeth B. Robert: «Como empresa privada, Vermont Teddy Bear ya no tendrá que superar los retos de una pequeña empresa que tiene que cumplir con los requisitos, cada vez más complejos y costosos, de empresas cotizadas en bolsa, disponiendo de más tiempo y recursos para dedicarlos al crecimiento de nuestro negocio». Las principales cifras financieras de 2005 fueron: Ingresos netos: 39,0 millones de dólares Beneficio neto: 2,5 millones de dólares A finales de 2005 la empresa disponía de una plantilla de 352 empleados, pero Elisabeth tenía más ambiciones para la compañía: «Mi visión a largo plazo para la empresa es aprovechar nuestras fortalezas operativas y de marketing, con una sólida estrategia de marca, para hacer crecer la empresa con ositos de peluche...
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...develop better immune systems to prevent allergies later on in life. Flowers also give off oxygen which people need to live. In addition, mothers will appreciate the flowers that Calyx and Corolla has to offer because the flowers will make them feel special and bring them longer lasting joy. B. Implementation Advertise on home and garden television shows and magazines and children's television programs. Mom's watching home and garden shows, reading magazines, or parenting children while the children are watching TV will be intrigued by Calyx and Corolla and encourage orders from mothers. The advertisements will also help make the company's name known to more potential buyers. Positioning the product as a need to mothers will also generate consistent orders and provide steady income stream for Calyx and Corolla long-term. III. Target group who patronize florists or other retailers and/or unaccustomed to purchasing products via mail order. A. Description People who purchase from florists are usually last minute shoppers wanting to buy something special for their loved ones. Shipping flowers to them would not fill their needs in time. However, exceptions are people planning a wedding, prom, or other engagements that require advance notice. These are the most likely potential buyers that Calyx and Corolla should target. These buyers would also provide another source of short term surge of income. B. Implementation To target potential buyers planning a wedding, form...
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...Name: Grade: _______________ Date: 09/29/2015 Case #: 3 Case Name: Vermont Teddy Bear 1) How would you describe VTB's business model (the products and services it sells, target market's to whom it sells them, the value proposition it offers, and its financial model)? VTB relies on gift sales across its three separately managed brands- Teddy Bears, PajamaGrams, and Calyx Flowers. A customer can purchase a stock teddy bear or custom design one by selecting the color and outfit from the menu of options. PajamaGrams competes in both the general gift category and global apparel industry. Calyx Flowers offers high-end flower arrangements for discerning customers who appreciates the long ‘vase life’ that was achieved because the company dealt directly with a small number of flower growers worldwide. Therefore, VTB’s business is highly seasonal. The company makes the most money during Christmas, Valentine’s Day and Mother’s day. Although VTB targets both adults and children, most of its revenue comes from adults buying gifts for other adults. Back in the 90’s, the company relied on radio advertisements and toll-free number orders but with the technological advancement, the company is facing challenges to reinvent itself. 2) How strong are VTB's operational capabilities, given their chosen business model? What challenges do they face during so-called "peak experiences"? 3) How strong are VTB's information systems, given their strategic...
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