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The UK greeting card trade does not exist in
a vacuum and is affected by the general
economic factors as well as those that are
specific to the trade. The old adage that the
greeting cards industry is recession proof - a
real belief not so long ago, just like the world
was thought to be flat - has been, disproven.
Emotional Rescue was, as ever, spot on with
its witty ‘economic crisis Christmas card’
which held off on the glossy UV varnish and
opted for a cheaper monochrome ‘colour it
in yourself ’ design with the promise of
‘nothing free inside’. However, on this card
protagonists Jeff and Maud still had their
glasses more than half full of wine so things
are not too bad!
Indeed, Clintons aside (more of that
later), there have been no major casualties in
the trade in the last year –
Cardgains’ membership has
remained steady at 1,000
independent rooftops, while
The Ladder Club’s two day
seminars were still full with
would-be card publishers
wanting to join the industry,
bringing reassurance that
the new life blood is still
flowing strongly.
Obviously though, when something
major happens in any trade’s status quo - like
its largest specialist retailer going into
administrative receivership as happened with
Clintons last year - it inevitably causes
something between a ripple and tidal wave
effect, depending on your perspective.
The chain, having been
resurrected in a smaller
and more focused form,
signals additional business
for those greeting card
publishers who have been
introduced under the new
management of Schurman
Retail Group, plus has brought benefits for
those card retailers located in the vicinity
of the 400 branches that were closed
immediately. The publishing casualties that
were predicted as a result of the Clintons’ fall-
out have not materialised though it did
prompt some pretty serious financial
restructuring for a couple.
Looking slightly broader, the hefty hike
in postal charges which came into effect last
April has been deemed to have had a
negative effect, but perhaps not as
significant a one as was initially thought.
And, on a positive level it did provide
some sterling PR opportunities for
the card trade, with the media
opportunities being superbly grasped
by GCA chief executive Sharon Little.
At time of writing, it is difficult to
fully access the effect of the increased
postal charges had on Christmas card
PROGRESSIVE GREETINGS WORLDWIDE 45
State Of The Nation
All ThingsConsidered...!
Top: Is the card industry’s ‘glass’ half empty
or half full?
Left: Many a true word said in jest! Emotional
Rescue’s recent Christmas card.
Below left: Dominique Schurman unveils the
first new look Clintons store last Summer.
Below: Upmarket cards are still selling well. A
new design from Lime.
Last year’s PG’s annual article tracking of the ‘health and wealth’ of the UK greetingcard industry was entitled ‘Steady As She Goes’. It predicted that the industry mightexperience a better year in 2012 than many in the industry were expecting. In theend it probably didn’t, but in saying that, it was probably not worse. The UK greetingcard trade can’t divorce itself from the general retail economy and the UK economy atlarge, and in both cases 2012 was a major disappointment. Most people expected apick up in both, but in the end neither happened, which did not bring glad tidings tothe card trade – and added to this was the mid-year business collapse (and thenpartial resurrection) of Clintons which sent ructions through the industry.
And yet, all things considered…it could have been a lot worse.
45-47_Grid 11/01/2013 11:04 Page 1
sending. Hopefully most of the damage will
have occurred in the low end boxed card
market, where few publishers or retailers
make much profit, rather than higher priced
and margin single cards for friends
and relations.
But all this has to be viewed against the
backdrop of the machinations at macro
level, which have a leaning on the
card trade.
This time last year the predictions for
the growth in the UK economy was for
around 1.3% -1.6% growth for 2012. In the
end (though we are still awaiting the figures
for the last quarter of 2012), it looks as if the
UK economy last year was at best flat. In the
middle of the year the nation experienced
the effects of a ‘Double Dip’ recession, and
now there is a real possibility that we could
also experience an unprecedented and
horrifying ‘Triple Dip’.
The squeeze in consumer spending as
a result of inflation stubbornly continuing to
be above the increase in wages is
something of which the greeting card
industry has no control, yet as an industry it
is dependent on consumer spending.
While, due to their relatively low cost,
greeting cards are not as prone to consumer
belt tightening exercises as other products,
they are not true necessities like food
and shelter.
This time last year there was a sense of
optimism about a gentle economic pick-up,
whereas this year sentiment is a trifle more
negative. ONS figures predict a 1% increase
in GDP in 2013, but even this seems overly
optimistic to many experts, especially if
there are more ructions in the Eurozone and
the US Congress falters on its agreements
on tax increases and budget cuts. In
essence, there is probably going to be more
economic flat lining, so the economy is not
going to help our industry out.
And added to the not so favourable
economic conditions, we have seen a
considerable shift in shopping habits to
online buying. Although the amount of
greeting cards bought online has not grown
significantly in the last year, the effects of
less traffic flow of people in
the shopping malls and high
streets ultimately mean less
sales. Moreover, whereas
the consumer may still be
buying his or her cards in
bricks and mortar stores,
some of those all important
gift sales that bump up the
average spend may have
gravitated to online.
Having said that, at
least the card trade is lucky
in that greeting cards are one of the few
items in store that are not subject to website
comparisons, and given the relatively small
cost of purchase and their tactile nature, are
unlikely to be in the future. One only has to
witness the fate of HMV, Comet and book
retailer Borders, to see the devastation and
havoc this has caused in many previously
buoyant retail sectors.
The visibility of greeting cards at retail
has taken a bit of a battering, especially in
shopping centres, with the halving of the
number of Clinton Cards’ stores. Some may
see it as natural attrition, believing the sector
to be over supplied at retail, but with greeting
cards being more of a prompted impulse buy
it relies on widespread distribution.
Sure, cards are still widely available, and
at all price points, but when 400 specialist
outlets are wiped off the scene, there are
concerns about what effect this will have
and who the benefactors will be.
Clintons’ failure elevated Tesco to the
number one spot for total greeting card
sales in the UK for the first time. Tesco has
always seemed to understand the greeting
card category better than its supermarket
peers, although expect to see a concerted
attempt at ‘catch up’ by its major rivals. It will
be interesting to see how Waitrose’s
offering and approach to the market
changes on greeting cards with the
change of category manager/broker from
Woodmansterne to Hallmark.
Of course, the elephant in the room for
many continues to be the hugely successful
value retail chain Card Factory. Now operating
from 700 stores, last year it recorded an annual
profit of £45 million – and they said there was
no money to be made in value cards! There has
however been a noticeable increase in some of
Card Factory’s price points, but the simple
strategy of publishing nearly all of its own cards,
and retailing them at extremely attractive prices
in a clean attractive shop environment, remains
the same and goes down well with a large slug
of the card buying public.
Yet at the other end of the scale, there is
continuing evidence that people in some
affluent areas and in certain outlets will pay an
astounding amount for a really special card.
46 PROGRESSIVE GREETINGS WORLDWIDE
State Of The Nation
Above: Tesco took over the mantle as the UK
retailer with the largest market share of
card sales.
Left: Chancellor of the Exchequer, George Osborne.
“The squeeze in consumer spending as
a result of inflation stubbornly
continuing to be above the increase in
wages is something of which the
greeting card industry has no control.”
45-47_Grid 11/01/2013 11:04 Page 2
Quality handmade card publishers such as
Five Dollar Shake, Tracey Russell, Blue Eyed Sun
and Wendy Jones-Blackett continue to
prosper even though the price of a card can
be upwards of £4.
Certainly at the upmarket end, the
competitive action has hotted up, what with
WHS’ Funky Pigeon concept now trading from
around 20 stores and rumbles are that there
are more to come.
Paperchase itself is now a major player
with nearly 200 stores, while Scribbler, a chain
which has eschewed the traditional expansion
into gifts and has just focused on cards,
continues to expand in metropolitan areas.
T h e n t h e r e a r e t h e r e g i o n a l
independently owned greeting card chains
that are confident in their offer – notably Card
Bar in the South West; Cards Galore, mainly in
London; Penmark in the South Midlands;
Temptations, House of Cards and Maythers in
the Home Counties; Park Lane Cards in the
North East and Cardland in Scotland, to name
but a few. All of these have to some extent
benefited from Clintons’ failure.
Industry veteran Paul Taylor (who
historically has traded under Paper Kisses and
Card Zone) captured the headlines at the end
of last year with his acquisition of the 13
Special Occasions stores in the South-West,
thereby taking his total number of stores to
64 and marks him out as a major player in the
greeting card market.
And so what of Clintons now? There is
no doubt that the collapse was no surprise.
The writing was on the wall for all to see for a
number of months prior to last May. Many
trace the seeds of the decline back to the
acquisition and subsequent mismanagement
of the Birthdays chain, as far back as 2004. The
ludicrously high rental agreements that it had
entered into in the boom years were also
unsustainable in recession.
What was surprising though, was the
speed in which American Greetings moved in
to protect its interests and how quickly the US
retail operation, Schurman Retail Group, were
in place not just to take over the reins of the
slimmed down Clintons operation
(comprising 400 as opposed to 800 stores),
but to instigate an impressive roll out
programme of new shop formats,
dramatically revamping 100 stores in four
months. Dominique Schurman, ceo
of the chain, sent out a confident
message when she spoke on Radio
4’s Today programme on Christmas
Eve, revealing that the average
transaction value had doubled in
the new look stores and things
were on course to turn the loss
making chain back into the black
this year. Certainly, operating under
lower rents and with the new
stores looking vastly improved on
the old Clintons, the immediate
future looks secure for the chain.
Christmas, by all accounts, was not a barn
stormer, but then it was never expected to be.
On a positive note, the prevailing media
attitude towards Christmas card sending was
much more positive. The usual negative and
disruptive comments emanating from certain
rogue elements in the charity sector
regarding the monies generated by
Christmas cards sales for charities have largely
been ignored. In contrast there has been a
myriad of positive TV and newspaper stories,
with even Christmas greeting card deniers
having to admit in print to Damascene type
conversions at the last minute to Christmas
card sending this year.
So, while 2012 did not bring all ‘glad
tidings’, there are certainly some ‘best wishes’ in
order for 2013 for the industry. The world is
moving at such a fast rate as the digital age
gathers pace that little can be taken for
granted these days, but the industry is still
worth an estimated £1.5 billion a year in the
UK. Despite Facebook, Twitter and texting and
all the other multi-various forms of social
media, it still thankfully remains a vital element
in the social glue that holds us all together.
True, we have real challenges in engaging most
of the male population and the young in
particular, but haven’t we always?
So in conclusion, all things considered
things could be a lot worse.
And to end this State of the Nation on a
positive note, it was interesting to read a
comment by John O’Sullivan, economics
editor of the well-respected Economist
magazine: “For Britons scarred by two
recessions, a decent year for the economy
might be too much to hope for. But once it is
looked back upon, 2013 may seem like an
unremarkable year for the economy, with
stable inflation and output growth of close to
2% driven by the familiar engine of consumer
spending. With expectations so low, the
economy has plenty of scope to spring a nice
surprise for once.”
The greeting card industry will certainly
drink to that!
PROGRESSIVE GREETINGS WORLDWIDE 47
State Of The Nation
Where Have The Acquistions Gone?What has been particularly surprising in the last year is the
complete lack of casualties or indeed notable acquisitions in
the publishing side of our industry. Nigel Quiney acquired
the publishing interests of Abigail Mill to anchor its new Spice
Studios division, but this was not a mammoth deal, while
UKG’s sale of its Xpressions business to Only 4 U was contained
in the gift arena.
In fact, in the last 15 years you would be hard pushed to find a quieter 12 month
period on the acquisition/company closure front. Perhaps record low interest rates and
the new reluctance of banks to pull the plug on ailing companies unless strictly
necessary have helped prevent the former, while a lack of surplus available cash available
to larger companies has prevented the latter.
Above: Nigel Quiney setting up its new
subsidiary, on the back of acquiring
Abigail Mill is one of the few
acquisitive actions in the trade over
the last year.
Above: A somewhat optimistic and nostalgic view of youngsters posting
Christmas cards from a design by The Almanac Gallery.
Right: Morcombe and Wise bringing some sunshine.
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