Petals Blooms Again Under New Management
At its height in the late 1990s, the company sold more than $50 million worth of silk flowers and other home décor items through the Petals catalogs, a Web site and eight stores.
But financial difficulties followed after parent firm Interiors went out of business. Petals filed for Chapter 7 liquidation in November 2003 and was acquired by private equity firm Southridge Capital Management, Ridgefield, CT, through its subsidiary, Petals Decorative Accents Corp.
"Petals was one of the most successful catalogs in consumer direct mail, and it will be strong again because the core model still remains intact," said Chris Topping, who was recently named CEO.
This is Topping's second stint with Petals. He worked for the company from 1994 to 2001 and was vice president of marketing when he left.
After relaunching the catalog in January, the new management plans strategies such as targeted mailings to lapsed customers, redesigning the catalog to look more like it did in the past and building Internet sales, a channel that management said wasn't fully explored previously. The goal for first-year sales is above $10 million.
"Within five years, we anticipate we will reach and go beyond where the company was in sales volume [at its height]," Topping said. "We're trying to both maintain the customers we do have and to reclaim some of the customers who may have been lost as a result of bad experiences under the old regime."
One reason it's important to reconnect with the "large lapsed customer base" is that Petals previously had a high rate of multiple purchases, he said. In addition to mailing books to names from the in-house list created by Petals under its previous ownership, prospecting will be part of the mix.
One mailing in development will be designed to ask for forgiveness from customers who may have had problems with the company under previous ownership.
Redesigning the catalog to resemble what mailed in the past is another way the company hopes to spark sales. The focus will be on allocating more space to core items and softening the design. The current look is "too harsh," Topping said. The book is to be redesigned in time for its November edition.
Petals also wants to focus on e-commerce. The company plans to expand its Internet presence for the fall/holiday period through affiliate programs designed to drive traffic to petals.com.
"Before there was very little in place to drive incremental traffic to the Web site," Topping said.
The sixth Petals catalog for 2004 was mailed in the second week of September. Ten drops are planned for the year with a combined circulation surpassing 6 million and an average page count of 60. Petals mailed 15 million catalogs annually in the late 1990s.
Product mix is similar to what it was in the past, with 75 percent of the selection dedicated to silk florals, plants and trees and the balance consisting of decorative home accessories such as rugs, figurines, lamps and mirrors.
Arrangements in the 48-page September book include a hydrangea and berry bouquet in a clear glass hurricane vase for $164.90 and a Japanese bamboo tree for $119.95. The company employs an in-house design team to create unique silk botanicals.
Petals' target audience is women 50-55 who have a household income in the middle to affluent range, are homeowners and have shown affinity for buying products via direct mail, especially home décor.
Silk flowers appeal to consumers who want the look of real flowers without the maintenance, Topping said. Petals' silk botanicals last several years and range in price from $10 to more than $100. The catalog's home décor items can go for as much as $1,000.