Playing Its Cards Right

Tedeschi Food Shops has realized double-digit sales growth in greeting cards for the past five years

Tedeschi Food Shops Inc. is dealing a great hand in greeting cards.

The Rockland, Mass.-based operator of more than 190 convenience stores offered some selection of greeting cards for many years, but in the past five years, it has expanded and fine-tuned this often-overlooked category, and it is paying off in spades.

Every year since 2009, Tedeschi Food Shops has racked up double-digit sales growth in greeting cards — between 10 percent and 20 percent, according to Mike Turco, category manager. For 2013, he expects the category’s growth to be “in the neighborhood” of 10 percent to 15 percent. “Frankly, there are not a lot of things we’ve done wrong here lately in this category. We have had good growth year over year for all five years,” he told Convenience Store News.

While Tedeschi Food Shops has long been a purveyor of greeting cards, it recently realized a larger opportunity when a competitive channel retreated a bit.

“Part of the reason we put a focus on this category is we saw what the drug chains were doing: focusing on being more like c-stores with drinks and snacks, and downscaling greeting cards,” Turco explained. “We see greeting cards as a perfect match for us. As time goes by, people are more time-starved than ever and are open to buying what I call ‘urgent’ products, like greeting cards, where they can get them. We keep the racks close to the front of the store so that they know when they need a card, they can come to us and get one.”

The chain’s best practices, however, go beyond merchandising the greeting cards in racks up front. Here are some of the forward-thinking strategies contributing to the “greetings” success at Tedeschi Food Shops:

• Go DSD. In January 2009, Tedeschi teamed up with Tree-Free Greetings, based in Swanzey, N.H., specifically for its full-service, direct-store delivery (DSD). “This service is very important to our success,” Turco stated. “They come in, put the cards on the racks, take the old ones out, check for those that are sun-worn or faded, and keep us current with the seasons and new styles.”

Utilizing this service through Tree-Free is the primary way the chain fine-tuned its greeting cards category five years ago after it had issues with former greeting card companies that did not provide DSD and showed up every three months or so. With Tree-Free, Tedeschi gets “freshening up” and stocking service every four to six weeks, according to Turco.

While Tree-Free is not the only greeting card company utilized by Tedeschi, it is the primary one. It is currently set up in more than 50 percent of the chain’s 190 stores, with more converting to Tree-Free as time goes on.

• Real Simple Pricing. Tree-Free offers its greeting cards with a single $2.95 price point, which Turco said is “fantastic. We’ve sold a lot of greeting cards at that price point since January,” he reported.
• Bank on More Blanks. It’s no secret that greeting cards are very seasonal. Christmas, Valentine’s Day, Mother’s Day and graduation are Tedeschi Food Shops’ top greeting card holidays. Easter and Father’s Day are also good holidays for the greeting card business at the chain.

But Tedeschi also delves into everyday card lines, and one of the faster growing segments lately is blank cards. “That solves all language barriers and they’re great for any occasion — Get Well, Birthday, Congratulations. They’re very versatile,” Turco explained.

Tedeschi is devoting more pockets on its racks to blank cards. He estimates that blank cards now make up about a third of the assortment. This is up from about 10 percent to 15 percent, depending on the store, from when the chain first started selling greeting cards.

“We continue to add blank cards in our stores, especially in neighborhoods where our customer base is driven by ethnicity. Our customers there really gravitate toward these because they can be written in their native language,” Turco said.

• Create Cross-Merchandising Magic. Cards are a natural tie-in with flowers and so Tedeschi Foods Shops recently started selling more fresh-cut flowers in its stores, including single roses, bunches and bouquets of flowers. Right now, the stores’ floral displays are typically found along the fresh-food area with greeting cards nearby. Eventually, though, Turco sees the two cross-merchandised together.

Another natural fit for greeting cards is gift cards, and Tedeschi is currently in the “development stage” with Tree-Free to merchandise the two types of cards together on the same rack to save space, according to Turco. “We’re talking with Tree-Free to devote one side of their rack — as much as half — to prepaid gift cards,” he said. “Eventually, the flowers and the greeting cards and the gift cards will all end up in the same spot.”

Overall, Tedeschi Food Shops is banking on the fact that “greeting cards are here to stay,” said Turco. “Even with all the online card options, there is nothing more personal than a hand-written card; it shows a lot of sincerity.”