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    Retailing greetings in a digital age

    Photo: iStock

    “God could not be everywhere, and therefore he made mothers,” – this famous line of Rudyard Kipling’s was printed in a Mothering Sunday card recently displayed for sale in a convenience store in East London.

    It shows how occasions are still important and impactful and how greetings cards perfectly cater to them – the proof being that annual sales are clocking up about £1.7 billion.

    There are many other special days celebrated throughout the year including Valentine’s Day, International Women’s Day, Easter, Father’s Day, International Yoda Day, International Friendship Day, World Teacher’s Day, Christmas, and New Year – not to mention endless birthdays throughout the calendar.

    It has been a custom for people to send greeting cards on special occasion such as Christmas and Easter, and other cultural events such as Diwali and Eid (and even Halloween), or to celebrate passing a driving test or a marriage. The most interesting facet of the business of greeting cards retailing is that it is typically a 365-day, lively business affair.

    “Spring is a busy time for card sales with Mother’s Day and Easter following hot on the heels of Valentine’s Day,” says Andrew Glen, managing director, Riverside Greetings. “The seasonal opportunities can generate significant incremental sales and profits if retailers offer the right proposition of quality design and value, well located and merchandised into a gifting solution with other categories such as confectionery, wine and flowers.”

    Retailing greetings in a digital age
    Photo: iStock

    With a total global share of about 35 per cent, the US is the largest market for greeting cards. The UK and Japan are in the second and third positions with a combined sales traction of approximately 35 per cent.

    The US-based Hallmark Cards, Inc. and American Greetings are the two largest greeting card manufacturers in the world, while Card Factory, Simon Elvin, Moo, Herbert Walkers Ltd and the like lead the UK pack. The UK’s Greeting Card Association [GCA] has over 500 small-to-medium and large greeting card manufacturers as its members.

    One billion Christmas greetings

    The UK sends almost a billion Christmas card every year, which is more per person than any other nation. The British splurged a whopping £1.7 billion on greetings cards in 2019, providing healthy income for many of the country’s artists, publishers, printers as well as the retail communities. The sales trend is only growing.

    Most notably, “more than 90 per cent of cards are bought in a bricks-and-mortar store in the UK,” adds Amanda Fergusson, CEO, Greeting Card Association [GCA]. “From the small independently owned card shop in your local community to Card Factory, our largest specialist which employs up to 15,000 people, these are all retailers who are helping to spread joy, provide comfort and reinforce relationships by their selection of cards.

    The UK’s GCA platform represents the interests of the entire greeting card industry – from the retailers who sell the cards and the greeting card publishers who create them, to the printers and trade suppliers who manufacture them. The country boasts some of innovative designs and novel ideas, and ships greeting cards to all over the world.

    According to the figures published by the GCA in its UK Greeting Card Market Report 2021, a total of 708 million individual greeting cards were bought in 2020. “The amount spent on single greeting cards in the UK came in at USD 1.49 billion, while the number of UK adults purchasing greeting cards reached 73 per cent in 2021 compared to 71 per cent in 2020,” the GCA revealed.

    “Social media messages are sent all the time,” Fergusson continued. “Greeting cards are a good tangible way to keep in touch and mean much more than a social media expression. Now we find 18-34-year-olds are sending more cards than a generation ago. The tradition of dispatching greeting cards is not only well established but also very profitable.”

    “Whether it is celebrating a birthday, welcoming a new baby into the world or attending a wedding, giving away greeting cards is a traditional sentiment,” adds the spokesperson for UK Greetings. “Greetings cards have a special place in our hearts, being at the forefront of many wonderful occasions. And the sentiment is here to stay.”

    Opportunity galore

    Greeting cards offer a great opportunity for convenience retailers to generate significant incremental sales and margin. Retail space for greeting cards category is generally limited in convenience shelves, which makes it more important for the retailers to manage the allotted space effectively, ensuring the collections are displayed in tune with the customer demand.

    “Regular innovation is one of the keys to success and new designs should be introduced on a monthly basis,” opined Glen of Riverside Greetings. “In convenience displays are relatively small and will require frequent additions of new lines so that they don’t go stale and continue to engage shoppers. The shoppers are very discerning, and no one wants to send a poorly designed card. Displaying old-fashion cards will deliver little for independents in the way of sales and margins. The keys to competing and beating the multiples on greetings cards are innovation and value.”

    Retailing greetings in a digital age

    Greeting cards are often an impulse purchasing item, so the offerings must be visible to shoppers. The display should easily be readable by shoppers and logically segmented with caption adjacencies which make sense to shoppers, i.e. Daughter near Mum cards.

    Although the majority of sales come from general birthday cards, prominence must be given as to how specific age, relation and live events captions are portrayed in the card. In addition to greeting cards, gift wraps and gift and bottle bags create opportunities for additional sales. Such retail add-ons form part of gifting category which will eventually push the purchasing pattern of average shoppers.

    As with every display there are hot spots which generate significant sales, and they should have premium products sited in them. “Don’t forget the role of point of sale whether that be category headers and footers, free-standing display units or wobblers,” Glen noted. “Retailers must make sure it’s in an engaging colour which shows the category in a positive light and not something dark or dingy or even as I do see on occasion black.”

    Giving-back stories make a big difference in shoppers’ mindset. Independents must create a space to offer products with a purpose, while sharing stories with your customers. The customers will be happy to know that the money they spend will not only make their special someone happy but also help others who are in need.

    “Progressive retailers are working with specialist suppliers like Riverside Greetings and seeing excellent growth from this high-margin opportunity,” added Glen of Riverside Greetings. “In fact, hundreds of new convenience retailers have started to stock the Riverside Cards brand in the last twelve months. In addition to taking advantage of the increased proportion of shopper’s spend which is going into convenience, there is research from the USA showing that younger shoppers are now sending more cards in a response to the phenomenon of digital messaging. People want to give and receive a tangible token of their affections. The greeting card market is seen by many as a traditional category which is in overall decline. Nothing could be further from the truth in the convenience sector.”

    A recent research report revealed that women purchase an estimated 80 per cent of all greeting cards and spend more time choosing a card than men, and are more likely to buy several cards at once.

    Trendsetters

    During the 2021 UK census, 262,000 people identified as a different gender than the one they were assigned at birth, with 30,000 specifying non-binary and 118,000 not specifying. From a clothing manufacturer to a greeting card supplier, the companies must be able to represent this portion of the UK populace. To cater to the growing segment, UK Greetings recently introduced gender neutral cards in its line of offerings.

    Retailing greetings in a digital age

     

    “One reason for us to think differently and invest in gender-neutral cards is gender-neutral parenting,” said a spokesperson of UK Greetings. “This can start as early as pregnancy, with some couples not wanting to know the gender of their baby – so there is increased requirement to stock gender-neutral baby shower and pregnancy congratulation cards. After this, gender-neutral parents won’t want to perpetuate gendered stereotypes on their child but rather allow them to explore their own likes and interests – avoiding discussing the child’s gender with them at all.”

    The spokesperson further continued, “The gender-neutral cards are the perfect way to respect this parenting style. Offering these cards in your store would mean that parents, friends, family and other loved ones are able to celebrate a child’s birthday without needing to open a gender discussion.”

    As the world is evolving to encapsulate different identities and self-expressions, it is important that businesses mirror this. Companies and businesses make social commentaries with the stock they pick, their actions, and company values. In fact, 71 per cent of consumers would rather buy from a company whose values mirror theirs, and so, by widening your range for inclusivity, you can be gaining loyalty.

    Greeting cards comprises two popular categories: Everyday card, which includes Birthday, Sympathy, Thank you, Wedding, Thinking of you, Get well, New baby and Congratulations, and seasonal card for Christmas, Valentine’s Day, Mother’s Day, Father’s Day, Graduation, Easter, Halloween, Thanksgiving, St. Patrick’s Day and the like.

    The most common and popular choice for standard greeting cards are five inches across and seven inches tall, which is close to Golden Ratio. Everyday cards account for 77 per cent of total retail value for all single cards bought in the UK, meaning the average retail price for an everyday greeting card is now £1.68 (up from £1.64 in 2015).

    Going digital

    Retailing greetings in a digital age

    The advent of digital greetings in the late ’90s followed by social media revolution had an initial negative impact on physical card sales. A long-term depressive impact, which was visible on physical card sales to youths, has changed along with the passage of time. However, Covid-19 pandemic forced customers to stay indoors and make online purchases.

    The market size of the online greetings card retailer industry in the UK, according to global research firm IBISWorld, has grown 15.2 per cent per year on average between 2018 and 2023. If online greeting card purchases continue to comprise a large share of the marketplace, greeting card companies will have to make the online delivery process as seamless as possible, which is going to be a major challenge.

    Meanwhile, demand from newsagents and stationery stores is a proxy for competition from traditional card retailers with physical outlets, as these businesses account for a significant proportion of the card retailing market.

    “People are keener about the touch-and-feel factor while purchasing greeting cards to celebrate their precious moments,” feels Riya Bibin, who recently bought a Mother’s Day card from an independent retailer. “Offline experience is something we cherish especially while buying a personalised gift item. The pandemic has heightened our online activity but I prefer buying greeting card from a retail store rather than from an online space.”

    “The keys to competing and beating the multiples on greetings cards are innovation and value,” shared Glen of Riverside Greetings. “In convenience displays are relatively small and will require frequent additions of new lines so that they don’t go stale and continue to engage shoppers. Using a sector specialist like Riverside Greetings means that an expert manages the category on behalf of the retailer. New lines are introduced every month, seasonal stock and additional temporary displays will be mobilised at the right times and all the merchandising and replenishment work is undertaken by the supplier. Importantly, stock can be accessed on a consignment basis, meaning that retailers only pay for what they sell. By having the correct stock, Riverside have been able to more than treble category sales for some retailers who have been using wholesale style stock.”

    Royal greetings

    During Queen Elizabeth II’s reign, Buckingham Palace sent around 1.3 million cards to mark birthdays and anniversaries across the UK, Commonwealth and British Overseas Territories.

    The number of recipients has grown along with the passage of time – King George V sent out 24 telegrams to centenarians in 1917, while the tally became 273 in 1952 when Elizabeth II became monarch.

    By 2014, the list topped 7,500 and the office responsible for dispatching greeting cards had to recruit extra staff to run the exercise.

    The tradition of British monarch sending greetings to mark significant birthdays and anniversaries dates back to 1917. King George V began the practice of sending a telegram of good wishes to those celebrating their 100th birthday or 60th wedding anniversary.

    It has gradually become a big affair with thousands of cards being sent to mark people’s 100th and 105th birthdays, as well as for couples celebrating their 60th, 65th and 70th wedding anniversaries. Greeting messages were also delivered to celebrate every subsequent milestone.

    Market outlook

    Of late, the greeting cards market has gone thorough rapid demand as well as pathbreaking adoption across various key applications and end-use sectors. The global economy, which is still struggling hard to come out of the Covid-19 gloom, is forecasted to grow at a snail pace due the Russia–Ukraine conflict, rising inflation and growing interest rates.

    Retailing greetings in a digital age
    Photo: iStock

    “Given the scale and gravity of the challenges faced in 2020, it’s clear that the greeting card market remains incredibly resilient with a strong underlying performance,” said Chris Bryan, president of the GCA. “The UK population continues to be highly engaged with this category and our appetite for buying and sending greeting cards continues.”

    According to UK Greeting Card Market Report 2021, “A total of 708 million individual greeting cards were bought in the year, with that figure not including Christmas card boxes and packs or packs of Easter cards.”

    This research project was undertaken by Echo, an independent research company, commissioned by the GCA to track purchases of everyday, Spring Seasons and Christmas single cards, both by volume and value, for the year 2020 compared to 2019.

    In the preface of the Report, Chris Bryan, president of the GCA put the figures into context. “While this [the total market value on single cards] represents an 8.5 per cent decline in retail value sales, this is a solid performance given the 2020 retail landscape,” he said, citing how in what was largely accepted as the worst year in retail on record, with a great many greeting card retailers forced to close during the lockdowns, not to mention the huge reduction in social gatherings and shared celebrations which are such great drivers for greeting card sales, the British public’s love for cards found a way through.

    “Given the scale and gravity of the challenges faced in 2020, it’s clear that the greeting card market remains incredibly resilient with a strong underlying performance,” stated Chris.

    Going forward, the greeting cards market is expected to be positively influenced by technological trends driven by increased R&D spending and growing focus on innovation by industry players resulting in novel breakthroughs. Significant opportunities in the forecast period will lead to new players entering the space and the market getting more competitive.

    Similarly, consumer expectations will continue to evolve, which will be met by new product launches with new features or lower price points as top companies focus on maintaining their leadership position and new players try to create a market presence.

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