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1800-Flowers CEO And VP Of IR Discuss 'Birth, Buy, Build' Strategy

December 14, 2015 12:27 pm
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1800-Flowers CEO And VP Of IR Discuss 'Birth, Buy, Build' Strategy

In an exclusive interview with Benzinga, 1-800-Flowers.com Inc (NASDAQ: FLWS) CEO James “Jim” McCann and head of Investor Relations Joe Pititto discussed the company’s “birth, buy, build” strategy.

The primary objective of this strategy is to increase the company’s share of customer wallet.


The birth component is launching new brands supported by the existing infrastructure. A Fruit Bouquets brand serves as one of the newest examples.

“Our customers are telling us they wanted these products,” stated McCann. “We have a network of florists who could fulfill these products… So, we created a brand called Fruit Bouquets, which is doing quite nicely.”

Related Link: Update: 1-800-Flowers.com VP Of IR Calls Outlook “Very Strong,” Believes Co Being Impacted By Apparel “Kind Of Ridiculous”


The buy component is purchasing existing brands to cross market to customers in other parts of 1-800-Flowers’ pipeline. The recent acquisition of Harry & David serves as an example.

“When we acquired Harry & David, the good news and bad news for us was that 17 percent of their customers were already on our 10800-Flowers list,” said McCann. The opportunity for the company is to cross sell other brands to the 83 percent of Harry & David customers which were not already in the pipeline.


This component is making current customers increase their share of wallet. Getting Harry & David customers to buy flowers is one example.

McCann spoke on the three strategies used to convert these customers.

“We have the multi branded portal that people can come to, whether it's the 1-800-Flowers part or the Harry & David part, they'll see the brands we have.”

“The second piece is, we have marketing opportunities,” including sending emails across brands.

“The third thing I pointed out was the back-end suite of services, which we call the Celebration Suite. We have Celebrations rewards, we have Celebrations passport, we have Celebrations reminders – and that's where people can earn and burn.”

McCann elaborated on the strategy, “We acquire a customer that's got an average household income of over $100K… So, when you can attract them to our franchise with the 1-800-Flowers brand, and then expose them to our other brands… they feel more and more comfortable giving us a larger share of their gifting wallet. Whereas before this, they'd have to go to all those separate places.”

Shares of 1-800-Flowers was recently seen trading at $7.69.

Image Credit: Public Domain

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