Despite its slogan that it is the "creative alternative to flowers," Vermont Teddy Bear entered the blooms business in August by acquiring Calyx & Corolla.
That is part of a strategy to become a bigger player in the gift market. By introducing—and buying—brands beyond its beloved BearGrams, according to Liz Robert, president and "chief bear officer."
Prior to her joining the it in 1997, Vermont Teddy Bear was in dire straits thanks to a "disastrous" initiative to move the firm into more of a retail direction, Robert said during the New England Mail Order Association (NEMOA) fall conference. Among other things, the company realized that 70% of the bears purchased in the Madison Ave. store in New York were being shipped elsewhere."
"Vermont Teddy Bear had the most expensive fulfillment center in the world," Robert noted.
The company closed its retail outlets and quickly refocused on its attention to generating leads by radio. About 85% of the bears are purchased as gifts, and mostly by men who need a last minute present for someone special. "‘Late Jack’ is our customer," Robert continued.
But the firm would also like to attract "Early Jills" who are more apt to think ahead and purchase things like new baby gifts. The hope has always been that recipients will see the bear they got from their boyfriend and remember it as a gift idea when friends have children. This hasn’t really happened much, said Robert (coincidentally pronounced "Ro-Bear").
In surveys, women said they shy away from bear purchases because they see the item as impractical or a dust collector. This led to the company’s introduction of its sister businesses, PajamaGram and TastyGram.
With its diverse gift businesses, Robert said the goal is to follow the "Williams-Sonoma/Pottery Barn model" of sister companies that market separately but in a low-key way use the brands to build customer trust.
"The narrower and more focused the ad message, the more you stand out for customers," she added.
Orders for bears, flowers and pajamas are fulfilled at the company’s 60,000 square foot Shelburne, VT headquarters, which NEMOA members toured on Friday. TastyGram orders are dropshipped from various locations around the country. The Shelburne call center is now handling calls for all four brands.
Valentines Day is the company’s busiest holiday. The most bears ever shipped on one day—37,000—were sent Feb. 13, 2002. That accounted for 10% of the company’s sales that year. "It’s a challenge to build an infrastructure you need for one day," Robert said.
Under a licensing agreement with Playboy, Vermont Teddy recently introduced what it hopes will be a hot product next Feb. 14, a Playmate bear, complete with bunny ears.
But it can be a bear to predict what will be the next big teddy, noted Allen Baker, who conducted one of NEMOA’s tours. For example, the "Gangster of Love" and "Love Bandit" bears didn’t sell as well as projected, but the "Elvis" bear was loved tender by many.
