Introduction to Case

Mr. Anil Moolchandani, a graduate from Delhi University, walked into his family business of saris.

While working for it he was obsessed of maintaining high standards and realized that his heart is in the

business of greeting cards, which appeals to emotions. As a youngster he was found of decorating

rooms and pop music. In the era of 1977, Chellsons was the whole sole poster making company

situated in Sivakasi, Tamil Nadu, not having vast distributing network. This made Anil think on his

hobby and translate it into existence. (Mital, 2009)

Archies Greetings and Gifts Ltd. was brought to life by Mr. Anil and Mr. Jagdish Moolchandani in the

year 1979. Initially he started with selling song books through mail order, later he realized the

significance of display and took a step ahead towards brand building through Archies Gallery and

Archies Card Shops. Today, Archies’ diverse and large bouquet of products includes: greeting cards,

posters, soft toys, gift items, cassettes/cds and stationery items. Later Archies planned to launch a

new chain of retail stores as ‘Stupid Cupid’ which will cater a wide range of woman accessories and

premium gifts. (Mital, 2009)

Question 1: What business is Archies in? Has there been a change in their strategy over years?

Please discuss

Answer: As rightly mentioned in the mission statement that Archies deals in the “Business of

Emotions”, it always believes in disseminating one’s emotion to other whether in the form of greeting

cards and gift items. But looking at the present prospects and offering of the company such as diary,

stationery, Accessories etc. another 2 pillars of support can be added to it that is the “Business of

Relations” and “Encompassing Human Expressions”. Therefore it can be said that Archies does not

only deals with Emotions of people but also tries to intact them into a strong bonding of relationships.

Thus Archies is clubbed into three key verticals – Emotions, Relations and Expressions. (Mital,

2009)

At the initial stage Archies was moving ahead with the prescriptive strategy by catering its customers

with cards, gifts and posters, which was a big hit. To make itself immune from the threat posted from

the external environment such as competition and more over the increasing demand of innovative

products it moved towards Emergent strategy. Later in 1989, Archies tied-up hands with HelpAge, for

global networking which was again an emergent strategy taken to widen its tentacles. (Mital, 2009)

Question 2: Does Archies have an advantage over other greeting manufacturers? What kind of

advantage and is it helpful in pursuit of their business? How?

Answer: Yes, Archies do had an advantage over other greeting manufactures. Various advantages

experienced by the company are highlighted underneath:

First Mover Advantage: Archies being the first greeting cards making firm had a great

advantage in the form of revenue and positioning itself in the minds of the customer. As after

launching Archies Gallery in the heart of Delhi University campus, helped them to meet the

break even in the first year itself.

People’s Company: having tie-ups with various corporate such as Sony corp, Shell Gas,

ICICI, Honda Motors etc helped in unveiling the collection and to grow the corporate network.

Concept of Occasional Cards: this concept gained momentum as it was erstwhile not so

popular in India. Archies started focusing on making new occasions, which helped people to

find reasons to greet each other. Valentine’s Day, Friendships day, Father’s day, Holi and

many more such occasional cards contributed 30% revenue of the total sales.

Cards in Regional language was the another innovative idea helped in gaining advantage

Collaboration:

o Licensing agreement with American Greetings inc. which helped them to source the

designs of American greetings and sell them as Paper Rose. With this tie-up Archies

was also benefited with the access to the other product line under American Greetings

umbrella such as Gibson, Hanson Graphics, Expression gifts and Carlton cards.

o Collaboration with Simon Elvin, UK based greeting card player helped in adding more

designs and variety to its portfolio.

Virtual Store: Archiesonline.com was the India’s first site and world’s first e-greeting site to go

paid. This was created to reach the end customers directly.

(Mital, 2009)

Question 3: What business is Vintage in? Has there been a change in their strategy over years?

Please discuss.

Answer: Vintage Cards and Creations was established in 1983 by Rajesh Vaishnav and Anil

Kapur. Erstwhile Vintage stepped forward into a business of providing Greeting Cards but later

with the changing trends started adding various range of products in its portfolio. Yes, there has

been a change in their strategy with the changing time. Vintage signed an agreement with

Hallmark cards, one of the world’s largest greeting cards company in order to exercise the

exclusive right to use copyrights in the manufacture, distribution and sale of products. Vintage

entered into an agreement with Walt Disney to increase the designs of its products. Mattel Inc.

U.S.A was the great help to Vintage for providing “Barbie” brand in India. (Mital, 2009)

Question 4: Where have vintage gone wrong?

Answer: Blunders which Vintage faced are listed below:

Having a piled up Inventory unutilized for cards manufacturing since 2001 of more than 18

months, which increased expenses of storing and maintaining

Lack of product innovation and variety

Steep decline in operating profits from the year 1999 which was because of increasing network

of franchise stores, without studying the market requirement and customers need.

Turning off the Pune plant and shifting to Goa was again a big problem.

Vintage was moving ahead on the same path as designed by Archies but Vintage being late in

the race was not successful in gaining the popularity in the market. It is well said that “Follow

the Leader” strategy in the market doesn’t always work. One should always try to revitalize

their brand and product with new and innovative ideas which was lacking with the case of

Vintage.

(Mital, 2009)

Question 5: What can they do to put their business on track again?

Answer: Vintage to resume itself in the Indian market should restructure its strategy to fight against its

biggest competitor. It should come up with the USP in its product range. Vintage is the company which

is not known to many so therefore they should make their presence in the market by not offering the

same in the market as Archies but it should come up with customized greeting cards, gifts, t-shirts etc.

the requirements of the customers can be collected online or else in physical stores. This will attract

customers because nowadays everybody wants something new and innovative.

Reference

Mital, A. (2009) ‘Archies vs. Vintage – Are We in the Business of Greetings’, Cases in Strategic

Management, Tata McGraw-Hill, pp. 12-22.