Marketing Strategy Case - Calyx Corolla

There are three types of customers Calyx & Corolla currently or potentially can pursue. First, individual customers, second, corporate customers and last is a mix of these two – potential group of individual customers within a corporate.

Currently, 70% of revenues of Calyx & Corolla were derived directly from the catalog that the company distributed monthly, while 20% were derived from corporate clients and promotional “tie-ins”. And remaining 10% was from outgoing telemarketing to previous flower recipients and existing customers. We think the revenue can be improved by re-allocating the resources into more cost effective segments described below.

Individual customers, specifically aged 30-55 females with substantial disposable income, were the biggest revenue generators. The catalog was the main form of advertising. In fiscal year 1991, total 12 million catalogs were mailed. However the response rate varied significantly:  1-2% in 7.8 million rented mailing-list names, in contrast to 5%-10% response rate from prior customers. We suggest reducing the expense on mailing to rented mailing-list names, targeting on the customers have higher response rate or other customers we will mention in later section. In addition, data showed largest group of potential buyers were people who patronized florists or other retailers and were unaccustomed to buying anything by mail order. Although the customer needs varied for different groups, in general, they required friendly service, fast delivery and long-lasting flowers, which has already been Calyx & Corolla’s major competitive advantage. The relationship between Calyx & Corolla and growers/Federal Express, contributed to its fast service from cutting to delivery and its freshness and longevity of flowers. We also would recommend the company maintain its advantage and invest into long term relationship with growers and FedEx. In addition to its continuity program, the company could develop holiday programs or reminder program that delivering flower in customized occasions, such as anniversaries and birthdays, it will be targeting the male customers who may forget special occasions, also benefit to offset peaks and valleys for growers.