FTD's Loss are lessons for you!

Published: Tuesday 3 April 2018

FTD's Loss are lessons for you!

 Over the 2018 Valentine’s day period FTD the USA’s largest Wire Service for Florists established in 1910, owner of Interflora US, Pro Flowers, Flowers Direct and other brands posted a $20 Million Dollar loss!

This on a sales period for florists that is supposed to be one of the most lucrative of the year.

Over the coming months I am launching a new topic for florists “Florist Fight BACK” and I am going to dissect the online florist marketplace and give practical guidance for you the florist to fight back from the Wire Services and the Order Gatherers.

FTD’s Failure is a Lesson for Florists

There are many theories as to why this happened, FTD’s own Press release states:

“We took a different approach to media-based marketing in certain brands, and the results were substantially short of our expectations,” said CEO John Walden FTD.

Poor Marketing Messaging

This marketing message saw them promote boxed flowers sent from central locations rather than use traditional florist arranged flowers sent from local florists. Which quite simply missed the mark for the message, consumers were turned off and it did not meet what they wanted.

Cynical Business Model to cut out the local florist

FTD’s push was also a cynical business decision to try and cut out the small florists across the country.  The thinking is if they can control boxes of flowers it costs them much less to make and send a box to a consumer instead of sending the order to the florist to make and deliver.

Just who are the Wire Services and Relays in business for?

Their shareholders of course and if they think they can make more money by disintermediating the florists they will.

Uber has done it with the taxi industry, Facebook and Google have done it with the Newspapers, just as Foodora and Uber eats are starting to do it with the restaurant business.

To a certain extent the Order Gatherers have already done this in the floristry industry, but whilst consumers are happy to pay much less and for a ride, or pay a little bit more for the convenience of having someone deliver their takeout. When they order flowers online as a gift to someone they are sending more than just the flowers they are sending an emotional experience as well.  More about that later!

Don’t Restrict Social Media Complaints

FTD compounded the marketing messsage error by then restricting customers from complaining about the quality of their flower deliveries on social media, so instead consumers using Facebook to complain they turned to Twitter and Google which doesn’t have the same restrictions.

We’ve even spoken about how to address complaints on social media in the past.

But is this really the only reason?

Ryan Strider from Strider SEO in the States talks about ”the commodification of flowers” where online florists in the USA are basically selling the same products from the Wire Services (Order Gatherers) and using their images on their own website.

Just like in Australia too many florists are allowing the Petals Network to host a generic website using the own florists brand name.

I agree with Ryan wholeheartedly that florists need to stop commodifying what they sell, what I don’t agree with is the assertion that customers are only price comparing on the same products – yes some might but not all.

Consumers are driver by the ability to deliver an order as well as price

I still very strongly believe that consumers are both price driven and the ability for the florist to be able to deliver the order as ordered.

The suggestion recently that Toys R Us’ failure was because of commodification is false, their failure was because they were saddled with hundreds of millions in unsustainable debts by Venture Capital firms making money from them.

The question that is raised though is a very pertinent question.

Whose brand are you building?

I’ve bought this up time and time again, if you allow someone else to dictate your brand through a website such as the Petals websites you are giving away your brand.  You need to be in control of not just the products on your branded website but the message the delivery locations and the business rules for how and when you and cannot deliver.

As floristry lurches even more to technology and a quality website becomes more and more important you need to have control and vision for your brand.

Manage Your Reviews obsessively

This flows from both the managing your own brand and making sure that you are on the right foot with social media.

The vast majority of consumers have little to no brand recognition for florists.  Which means they uses the search engines to search for someone to deliver their flowers to.

This means online reviews are of significant importance for you and you should both encourage them and manage them.  A 4.5 star review where there is honest feedback with good customer resolution is far better than a 5 star review of dubious quality.  Consumers are skeptical of review websites where everything is too rosy.

Use your own product images

I am all for florists that are just starting online to build their own product catalogues with images from Interflora or other Relay networks as a starting point.

But as florists you are incredibly talented and creative and you should be replacing these images as you go with your own work.

It’s not that difficult to quickly build a catalogue of work to promote online from the arrangements that you do every day.  And you can do this by setting up a simple place in your workshop to take pictures in a consistent way.

Consumers want the “wow” factor for the item delivered

Boxed arrangements sold by Amazon , FTD, Pro Flowers etc. are not selling well online.  Sure the marketing message seems great: “cut out the middle man and save”.

The problem is consumers don’t want to send a box of unopened flowers to Aunt Flo for her 80th Birthday.  They want Aunt Flo to open her door to find a delivery person holding a spectacular bunch of flowers for her and have and elicit an emotional response.

It’s exciting when someone sends you a gift, it’s even more exciting when it’s a spectacular floral arrangement!

Selling Flowers Online is more than selling a product it’s selling an Emotion.

It’s hard to get the same emotional response by Aunt Flo finding a box on her front door step and opening it to find 12 red roses in an unopened state.

Think of the reasons people are sending flowers they want to make someone Happy, or apologize and say I care.

Boxed Flowers do not sell!

Boxed flower deliveries simply don’t cut it and the recent FTD loss proves this!

So for you the florist it means keep to selling and making amazing floral creations and sell these online.

Concentrate on targeting your local markets

One of the key marketing lessons that we have learnt from over 15 years working with florists is that the best approach is to target only the areas that you can physically deliverer to.

Yes it might be tempting to accept an order for out of town but are you really making money here? Or are you potentially damaging your brand.

Ask yourself how much it costs to acquire that customer and then ask yourself how much it cost to have another florist make and deliver that product.

If you sent the order to one of the relay networks by the time the end florist got the order can they actually afford to deliver the arrangement that was pictured?

Can you even guarantee what was delivered?

The best advice is to concentrate on perfecting your local marketing through local SEO, GEO-Targeting and more.

Stick to the Models that work but stand out

The number of times I have been in a room with a potential customer and they have told me “my business is different” is astounding.

No

Your business is not different, you buy items and then you add value to the items through making arrangements and you sell these for a profit (hopefully).

Want is different are generally your Products, Marketing Messaging, Your Story, Customer Service etc.

A couple of times in my 25 year career I have been lucky enough to help people who do have a totally new business model, but the basic rules of business still apply you need to make money or you will fail.

A well designed ecommerce florist website by Flower Store in a Box will allow you to concentrate on your point of difference for your business in a framework that gives the customer the experience they expect.

Conclusions

The FTD loss was not unexpected:

  • A business model trying to make more money and disintermediating your stakeholders
  • Failing to understand what consumers actually want as a product
  • Trying to silence consumers in the brave new world of social media

These three key issues created the perfect storm for FTD’s failures.

What lessons can you learn and take away from this?

  • Use the right Marketing Message
  • Consumers are buying more than just a product and want the emotional wow factor
  • Don't try to Silence Consumers
  • Use your Own Product Images
  • Concentrate on your local delivery areas.
  • Be creative and original with your products but deliver a consumer experience that is consistent

Are you looking to take hold of your online floristry brand?  Why not get in contact Flower Store In a Box and discover how to get your own fully featured ecommerce website for your florist.

Drew Wentzel

Drew Wentzel

Drew Wentzel is the principal of enflexion with over 25 years of experience in developing web services and software, Drew has helped design and develop usable and functionality rich Internet applications and built online presences for a wide variety of industries including retail, government, hospitality, lifestyle, corporate and technology companies.

Tags: Florist Fight Back, Business

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