| American Greetings | One American Rd., Cleveland, OH 44144-2398 |
| www.americangreetings.com | (216) 252-7300 Fax: (216) 252-6777 |
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Pleasing the masses
Jacob Sapirstein began selling postcards wholesale from the back of a horse-drawn wagon in 1906. Today, his Cleveland-based American Greetings is the world's second-largest greeting card company with 36 percent of the U.S. market. American Greetings shuns the specialty store markets favored by industry leader Hallmark, opting for the mass merchandiser - retail chains, discount stores, and supermarkets. The company tailors its product mix in mass retail stores through thorough studies of specific markets. In particular, it takes into account variables like age, income, gender, religion, and race. Unlike other card companies, American Greetings has expanded its merchandise horizons. Its other products include: Learning Horizons, a line of supplemental educational products; Magnivision, a line of non-prescription reading glasses; and Plus Mark, seasonal products.
Publicly traded since 1952, the company joined the NYSE in February 1998. Today, AG is concentrating on three drivers of growth: a massive overhaul of their U.S. greeting card operation, international expansion, and emerging business segments like party goods and electronic commerce.
On the upswing
The popularity of American Greetings was strengthened during the 1980s and 1990s through licensed characters including Ziggy, Holly Hobbie, and the Care Bears, which earned the company $2 billion in two years, through merchandise sales, a cartoon series, and three animated features. In 1992, the company put creative greeting power in the hands of the consumer, introducing the CreataCard computer kiosks now found in retail outlets throughout the U.S. The company increased its market share in 2000 by purchasing the third-largest greeting card company, Gibson Greetings. In 1999 AG acquired Contempo Colours, a party goods company. The following year, it announced plans to purchase gift-wrapping paper manufacturer CPS Corp.
The times are a' changin'
American Greetings prides itself on its ability to respond to the needs of the times. "Every card created by AG is pre-tested before being widely distributed," it boasts in its annual report. Early on in 1998, the company began a transformation and replaced 80 percent of its product with a new card line, "The All New American Way." Equipped with the tagline "this is not your mother's greeting card," the American Way line is meant to address changing lifestyles and demographic trends in the U.S.
Women anytime
American Greetings believes core greeting card buyers - women between the ages of 35 and 65 - want to see reflections of their own lives, such as working motherhood and cultural diversity. In addition, the company is in the process of developing snottier, "humor with an attitude" cards, and cards appropriate for people living with long term illnesses. To market the new cards, the company has developed the "American Greetings Says it Best" campaign, featuring cards pasted into national magazines such as Life, Glamour, and Newsweek.
Acquisitions around the world
In 1995 American Greetings bought a major stake in a South African greeting card company. In 1996, it acquired the John Sands Group, the largest greeting card company in Australia and New Zealand. Early in 1998, the company licensed Clifford the Big Red Dog and the Teletubbies, the brightly colored characters from a British television program aimed at preschoolers. In recent U.K. news, the company's United Kingdom holding company, U.K. Greetings Ltd., acquired London-based card maker Camden Graphics Group. Although the terms of the deal weren't disclosed, American Greetings announced the acquisition will add $17 million dollars to its total revenue. In January 2000 the company announced that its South African subsidiary had acquired Creative Productions, makers of Creative Stationery. This strengthened the company's position in the South African market, as well as in Australia, New Zealand, and Canada, where it is number one in market share.
"Just because" we want to make more money
In its first large consumer ad campaign in a decade, American Greetings created the all-occasion "Just Because" greeting card line. The campaign aims to address everyday occasions, rather than special occasions such as birthdays, anniversaries, and holidays. This line will comprise approximately 15 percent of the company's total cards; American Greetings plans to spend over $15 million on the effort.
Going electronic
In 1996, AG joined the electronic marketplace with three new ventures: American Greetings On-Line for Internet shoppers; American Greetings Personal Cardshop for Home and Office, a CD-ROM that allows users to personalize and order cards via an Internet connection; and CreataCard Plus, a home version of the CreataCard kiosks. In June 1999 the company announced plans to transform its electronic marketing division into a subsidiary and offer a portion of americangreetings.com to outside investors. In August of that year, the company announced a new $100 million deal with America Online that allows it to create new Internet products and expand its relationship with the ISP. The five-year deal gave AG access to 46 million users worldwide. The company's electronic strategy has hit some bumps, however. In June 2000 Hallmark sued American Greetings, alleging that its web site and two software products used Hallmark-owned technology.
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American Greetings posts all job opportunities through the internet on Careerboard.com and Monster.com. If you're in the Cleveland area, AG also advertises in the local newspapers. American Greetings does not accept unsolicited resumes. For recent college graduates, the Information Systems department is the most active in hiring; recruiters attend job fairs at colleges and universities that have established management information systems programs. There is plenty of opportunity on the manufacturing end as well; AG has plants in Arkansas, Kentucky, and Tennessee.
The hiring process consists of several rounds of interviews, usually starting with HR, and followed by meetings with the potential manager and other department personnel. Insiders say to "be prepared for a very impersonal first interview, as managers often ask canned questions from written lists." In fact, say insiders, prospective employees often receive the same questions in successive interviews. Second interviews, however, are said to be "better" and more personal. American Greetings is looking for dependable team players with growth potential. They stress - and reward - creativity and innovation in every department, as well as a "willingness to change in pursuit of continuous improvement."
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Us and them
Insiders say that American Greetings has "two distinct corporate cultures:" the "creative" and the "numbers" divisions. Another insider reveals, "the people in creative refer to the "numbers" part of the company as 'the other side of the building.'" On the creative side, where the graphics and copy are developed, "jeans and sweats are common" and morale is "at an all-time high." Financial and business employees, however, dress more formally; insiders say they frequently complain about "distant and uninterested" top management. Posted working hours are 8:00am to 4:42pm, but "mostly we work until the job is done," says one insider. "Creatives" typically work about "40 hours" a week, and those on the "numbers" side work "about 50."
Women at the top, despite sluggish promotions
One insider attributes slow upward mobility within the company to the "tight control held by the founding family." After some downsizing in 1996, many feel that the company is benefiting from steady growth and now offers more room for advancement. "I notice new employees having the opportunity to be promoted much earlier and more often than was the case when I first started," says one insider. The consensus seems to be that women and minorities are treated with respect at AG. In fact, women hold a number of positions in top level management, and outnumber men in several departments. As one American Greetings contact explains, "We have a business rationale that since women are our major market target, women should be managing many areas of our business, especially Product Planning and Research." But another insider pointed out that "in general, the company does not go out of the way to look for [minorities and women] either in hiring or in promotions."
Socially splendid
The consensus is that American Greetings is a very people-oriented company. "This [stems] greatly from the nature of our business of Social Expressions products, as opposed to high-tech or hard science-related businesses," says one employee. The cooperative spirit, some maintain, is what makes American Greetings so successful. "Everyone is saying hi to each other down the halls, and it doesn't take long before you are chiming right in." Insiders agree that AG "is definitely a great place to get started.?"
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Patti Virost
Human Resources
American Greetings1
One American Road
Cleveland
OH
44144
216-252-6590
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Balloons;Candles;Candy;Educational materials;Giftware;Greeting cards;Nonprescription reading glasses;Paper party goods
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Factory Card Outlet;Gibson;Greetings
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