When Hickory Farms decided to launch its Web site three years ago, some thought the catalog should feature more exotic fare than the hearty staples that made it famous.
“But we found many people were searching for beef and cheese,” says Marco Pescara, vice president, direct marketing.
The lesson?
“Don’t be afraid to be who you are.”
The privately-held Maumee, OH-based specialty food cataloger has built its brand on that edict and another tried-and-true business concept-acquisition. Between June 1991 and October 1994, Hickory Farms acquired California Cuisine, Ace Specialty Foods, Pfaelzer Brothers, Mission Orchards, Almond Plaza and Pinnacle Orchards.
All of the brands target different tastes but are tied together by one obvious theme: food. Originally, Hickory Farms was a retail brand, with over 500 storefront locations. But about 12 years ago, a need to expand distribution channels led the company to direct marketing. Now, the primary retail thrust is only at Christmastime, when kiosks are set up at malls across the country.
But don’t look for Mission Orchards or Ace stands to pop up as well. The company has no plans to move other brands into retail-nor does it have any plans to do anything to link the various brands together in the public’s mind.
“There’s no marketing advantage,” says Pescara. “We don’t consider any of the brands sub-brands of Hickory Farms or vice versa.”
Databases for each brand are kept separately (Hickory Farms has over 138,000 last-12-month buyers; Mission Orchards, over 34,500; Almond Plaza, 26,500; Ace, 19,700; and California Cuisine, 10,500.) The company respects the differences between its buyers-a Pfaelzer steak buyer is different from a Hickory Farms beef stick customer, and likewise, an online buyer differs from a print catalog consumer.
Some of the catalogs-such as Pfaelzer and California Cuisine-are mailed year-round, while others are circulated heavily during gift-giving seasons. Between 10-20 million catalogs are mailed annually.
Hickory Farms ventured slowly from the physical to virtual page three years ago. (“We didn’t want to get into a financial black hole with the Web site,” says Pescara.) The site, www.hickoryfarms.com, was originally intended merely as a vehicle to get catalog requests, but the company quickly found that people wanted to order online.
Eighty percent of the online buyers are new customers. “When you consider the Hickory Farms tradition it didn’t surprise me,” he notes. Initially, there were some worries that such a traditional product wouldn’t connect with a high-tech audience. But the company quickly realized that the “beef and cheese” buyers weren’t the only hungry folks online. New customers-perhaps more interested in raspberry white-chocolate cheesecake-shopped at the site too, attracted not only by the food but the company’s service and product reputation.
That reputation helps make it easier to encourage people who might not have purchased anything online before to give it a go, reasons Pescara. “People think ‘Hickory Farms hasn’t let us down for the last 46 Christmases, so they wouldn’t now.'”
A good number of catalog requests have been received online, but Pescara describes them as “curiosity seekers,” noting the conversion rate is low. “They’re online buyers, and [print] is a different channel,” he says, noting that because of that online buyers don’t automatically receive the print catalogs.
(The conversion rate of hits to sales on the Web site is much brighter. Pescara says that while the site doesn’t get millions of hits, the growth of the site in sales rivals Hickory Farms’ fastest growing print titles.)
For the past year-and-a-half, Hickory Farms has also offered specials to visitors who sign up for an e-mail list. Pescara says these have been “very successful” because people likethe “preferential treatment.”
Happily, Hickory Farms found that the average order of the online consumer was about the same as the print consumer. (According to the Hickory Farms data card, the average sale is $85 for the flagship brand, compared to $110 for Mission Orchards and $60 for California Cuisine.)
As for the other brands, their presence online is currently only an order form page allowing customers to place orders online from the print catalog. (Mission Orchards, like Hickory Farms, is also on America Online).
The company has experimented with discounts and premiums online, but Pescara cautions that if discounting isn’t what your brand is known for, make sure you’re doing it for a valid reason, such as a way to acquire new customers.
“Consider what it will do for your brand,” he says, adding that consumers may feel confused if they see prices online lower than in print.
“We feel product and brand are our selling points, not necessarily price,” he notes. “Price will always work but we try to restrain ourselves.”
As for what the main growth areas will be in the future, Pescara says that’s difficult to determine because the competition to many of Hickory Farms’ brands is so strong-for example, in the fruit category, Harry & David; in meat, Omaha Steaks; and in food gifts, Swiss Colony.
“We have to be more innovative, because in most of our niches we’re not the biggest player,” he says.
So where will that innovation strike next? The company plans a redesign of the Web site as well as the launch of another brand on AOL, a cross-promotion with other major non-food brands online and a repositioning of products in California Cuisine toward assortments of items for entertaining.
But, says Pescara, the objective always remains the same: “To make you hungry.”
Based on our strong results last fall, and lower paper prices, we plan to circulate more aggressively this Christmas season. We will be mailing to both inhouse file names as well as prospect lists proportionate to last year. As we continue to grow through our specialty catalogs, we use our inhouse file more frequently. Since there are over 12,000 catalog titles competing for consumers dollars, we like to have a strong presence in our customer’s and prospect’s mail boxes. We anticipate mailing costs to remain fairly stable. Third class postage will likely go up only four to five percent, between June and January. Paper prices have moderated well. The economy and employment are strong and should remain so into the fall season.”
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