FTD is Back In Bloom

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CHR

CHR

Design matters
Nov 28, 2002
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Feature article today on BusinessWeek.com - FTD is Back in Bloom.

The discussion revolves around FTD's recently rebounding stock price (from $9/share to $11), rates it a 'strong buy', and predicts $15 looking forward 12 months.

According to the article, the florist segment generates 82% of income, while the consumer direct division contributes 18%.

The report twice cites that FTD doesn't bear the burden of maintaining inventory or operating stores (like we do). The writer says FTD expects modest growth in its florist segment, including the grocery store expansion.

I disagree with their predictions about increasing, let alone maintaining, income from florists. As FTD takes on more supermarkets, their florist segment profits will naturally decrease because those kinds of stores will likely eschew many of the standard (proitable) flower shop services.

Would love to hear FC members' take on this piece.
 
If the FTD florists that I have talked to since Mother's Day are any indication, FTD had better have a whole lot of grocery stores signed up to take the place of that florist segment.

Most of the florists I've talked to say that real florist orders traveling through the FTD system were non-existent this holiday. And every one of them are looking for ways to drop FTD. They're sick and tired of paying all of that money to fill orders for .com.

I just don't think that FTD is able or willing to offer any real value to florists in rural and smaller urban areas any more. For what they cost, they're just a bad value. Can't even justify keeping them for the brand any more because the only thing that brand seems to represent in their advertising any more is .com. Course, if this analysis is right, might not want them advertising for us. All those millions and direct sales are only 18%???? Maybe they're not too good at advertising and promoting.
 
I don't know Cathy...FTD is such a long-standing brand and has such deep, almost primal, associations with the flower industry in this country that I don't *ever* see some local florist abandoning it. As I have said, I don't believe many florists care if they break even/lose money with FTD, but they just like the "status" of being part of such a long lasting, established network.

They like the little parties FTD throws once a year, and hobnobbing with industry "bigwigs"...so what if many are losing $1-2k a year? They will just stuff a few less daisies and carns into that @@@@ smiley face coffee cup.

I think what Wall-Street really likes is that FTD has the brand power to compete with PF in the direct ship arena, something no other company can possible do (right, Brandon?). They are rewarding the share price because the Street sees the DS-centric model as the future of the industry, and also feels that most FTD florists are so blinded by the Mercury Man that they will allow themselves to be sucked dry until the bitter end.

Donuts, anyone?
 
hcflorist said:
Most of the florists I've talked to say that real florist orders traveling through the FTD system were non-existent this holiday. And every one of them are looking for ways to drop FTD. They're sick and tired of paying all of that money to fill orders for .com.

QUOTE]

This is very true. 99% of the orders we received in by merc for Mother's Day were .com. We had two over the phone from real florists and 1 by merc. Being our second MD without Teleflora, speaking with the rural florists in this state, most of them have gone to Teleflora therefore we will not be getting those wire ins anyway. Gave us much more time and effort to fill direct orders by C/C which were up over 50% from last year.
Click to expand...
 
On the flip side, our incomings this mother's day were double last year, FTD only, and 100% from real florists. Perhaps we're seeing more of the consolidation of the industry with the real florist order volume being filtered and funnelled more than in previous years?

Ryan
 
Same here - every incoming I got was from a real florist which we filled gladly. Not a single dotcom. A couple attempts by known skimmers that got forwarded to the junkyard. But the rest we were happy to do.
 
Infinite said:
On the flip side, our incomings this mother's day were double last year, FTD only, and 100% from real florists. Perhaps we're seeing more of the consolidation of the industry with the real florist order volume being filtered and funnelled more than in previous years?

Ryan
Click to expand...
Ditto, and I'm with Ryan on this one... I have been saying for a year or two now, that what we are and will continue to see is a consolidation in the industry, all the way down to the local level. Good shops will become stronger and weak ones will fade away. When this happens, the orders do not go away, they move to another shop.

With that, I too think, that while the likes of FTD continue to gain customers, that they lose many at the same time. Judging by the number of new customers I added last week alone, and it was over 100 not including web placed orders I think more consumers are finding their way to a local florist, this trend too I feel will continue to grow.

The thing thats hard to pin down are the real numbers, big companies can afford big accountants that can put numbers in such a way to make what ever spin they want...

One last thought...I think we'll see an ever growing number of florists leaving FTD, and that while they will continue to add newbies...eventually the well will run dry.
 
Boss - PM me on how to get a new customers list so I can see how many we added last week.

zorro
 
We didn't see ....

any dot.com orders this year until yesterday. Then they started to come in. I think they are way behind and are just getting them filled now.
 
I had 5 phone calls from 800Flowers yesterday wanting to place orders by phone. All told me they "couldn't merc" to me. I won't accept any phone orders and when questioned why? Told them I wanted everything in black and white, including the price changes and delivery charges as well as a second choice of "as close as possible or designers choice to value".
No orders came through. JustFlowers tried yesterday and today, From You Flowers tried today. Geez, think they had trouble last week???
I know of one of my customers who called searching for the order from her son. She had tried a couple of other shops and then asked if I could help her. (she knew if I had the order, she would have gotten it). I explained the web of deceit in internet ordering, she was calling son to find out who he had used.
 
I figure it out - it's real easy. Just run a report from your marketing window on new accounts from say 2/1/06 thru 2/15/06 and see what count you get.

Time for welcome and preferred customer cards again!

Then thank you cards then discount offers and birthday reminders. No excuse not to market like hell in the summer!
 
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BOSS said:
With that, I too think, that while the likes of FTD continue to gain customers, that they lose many at the same time. Judging by the number of new customers I added last week alone, and it was over 100 not including web placed orders I think more consumers are finding their way to a local florist, this trend too I feel will continue to grow.
Click to expand...

How do you measure, FTD's plus and minuses customers as well as those 100 becoming your customers for futures sales?

Joe

Mark, I always enjoy your comments ....just holding your feet to fire on this topic a bit. hope you don't mind. thanks
 
Getting back on topic.

This article is riddled with wrong assumptions... I will leave it up to you all to find them.

Most importantly is that the author did not interview any traditional florists. ( I may be mistaken, I skimmed this article earlier today and did not have time to review further).

Also, no one from FTD were quoted in the article.
Joe
 
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Joe Mioux said:
How do you measure, FTD's plus and minuses customers as well as those 100 becoming your customers for futures sales?
Click to expand...
Mind? ...ME....never...someone has to hold me accountable...

As to measuring FTD's plus/minus customer base, this is based on an assumption that the natural ebb and flow of satisfaction will create some discontent among current customers, and that they will naturally gain new customers thru various marketing efforts. Many consumers flock to the likes of FTD.coN for reasons we all know, convienence, the "brand" and assuming that they are dealing with a Real Florist (wrong on their part)...

Next item: I do not assume that the 100+ added customers last week all came from FTD, sorry if I implied that, I was only stating that I added that many new accounts to my database. I would assume that some did come from former users of FTD.coN, but also from TF.coN, 800Flowers, maybe even ProFlowers, and then a few were probably also former customers of other Real Florists.

I'm also sure, some of my local customers found their way directly to other Real Florists web sites or phones, and that they by-passed me as well, while this is not something I really want to have happen, it does, and will continue to in the future, hopefully off-set by consumers finding me directly as well.

(Joe, turn my feet over, their done on that side...next...)
 
It should be easy to find how many new customers

bloomz said:
Boss - PM me on how to get a new customers list so I can see how many we added last week.

zorro
Click to expand...

A computer assigns consecutive numbers to new customers.

So just find a starting point [new customer number for that date] and subtract that from the next customer number your computer will assign.
 
I know several shops who were strong supporters of ftd. I understand that their numbers for incomming were off. Downward.

Considering the known quality of their services. I feel safe to say there is good possibilities that some of ftd's work was dumbed down.

If they planned for the decrease by reductions in inventories and labor. Returns in cash should show up nicely.
 
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