Hallmark Competition
Now Viewing Hallmark's competition in: Gift and Souvenir Stores
Call Preparation Questions
Customers, Marketing, Pricing, Competition
Who is the company’s typical customer? - While the typical customer can vary by store type, women between the ages of 40 to 60 buy the majority of gifts.
What are the company’s most effective marketing and promotional vehicles? - Vehicles include direct mail; newspaper, radio, TV, and outdoor advertising; and newsletters/flyers. Souvenir shops may rely on billboards and state department of transportation signs to draw tourists.
What types of special events does the company hold? - Special events, such as holiday open houses, product demonstrations, and trunk shows help drive traffic.
How often does the company hold clearance sales? - Most gift stores hold sales several times annually.
What role do store employees play in the selling process? - Seasoned, knowledgeable sales staff can help identify popular items, recommend gifts, and encourage impulse purchases.
How important are Internet sales to the company? - About half of companies sell merchandise through websites; online purchases are generally a small percentage of sales.
Competitive Landscape
Consumer spending, special occasions, and tourist travel drive demand. The profitability of individual companies depends on effective merchandising and the ability to generate store traffic. Large companies have advantages in purchasing, distribution, and marketing. Small companies can compete effectively by selling specialty products, providing superior service, or delivering a unique customer experience. The industry is labor-intensive: average annual revenue per worker is about $80,000.
Business Challenges
CRITICAL ISSUES
Competition from Alternative Retailers - Gift stores face intense competition from mass merchandisers, department stores, and Internet retailers. Wal-Mart and Target are the top two destinations for gift shoppers, according to Unity Marketing. Reseller websites, such as eBay, have stolen sales from stores specializing in collectibles. The Internet offers alternatives to traditional greeting cards (such as e-cards and customized cards), which could limit growth in a key category for most gift retailers.
Dependence on Consumer Spending - Most gifts are discretionary purchases and gift sales depend on consumer spending. While consumers may not eliminate gift purchases when the economy slows, many spend less and are less likely to buy additional items for themselves on impulse. Without established customer bases, new or struggling independent gift stores can be especially vulnerable during tough economic times.
Industries Where Hallmark Competes
- Media
- Publishing
- Greeting Cards(primary)
- Publishing
- Consumer Products Manufacturers
- Retail
- Floral & Gifts Retail
