Credit Extra Assignment 12/8/08 One of the problems facing a large business such as FTD Corp. is that other business are providing services that are more convenient to the customer. While FTD Corp. was the dominant force in the flower delivery business for many years, with recent technologies smaller business can gain a competitive advantage in certain marketing aspects. For instance, 1-800 Flowers allows someone to order flowers by phone or on the Internet. Competition has led FTD to lose its dominance of the market. It once controlled 80% of the flower delivery market in 1999, and as of 2005 controlled 50% of the market. Other problems facing FTD is an increase in competition. As the flower industry becomes more technologically innovative other dynamic companies can gain a share of the market. Furthermore, FTD is spending a lot of money on its new marketing campaign. Not only is spending money risky, but also some of its more traditional customers might see themselves no longer identifying with the product. A way FTD is trying to fix these problems is with product positioning. With the newer technologies, FTD appeared to be a company lacking the best service, which was not its original image as a company. By launching its Language of the Heart campaign, FTD is trying to change this laggard image and restore its concept as the best flower deliverer. By creating a new web page, FTD can compete with other Online flower distributors. The site allows customers and member florists to order flowers worldwide. The customer can also look through the catalog in selecting his flowers, and can pay online using a credit-card. The website also updates its customers on upcoming specialized sales. Another FTD strategy involves improving its service quality model through the use of the Mercury Network. This network allows the majority of its florists to get information faster so FTD can information get to its customers faster. This network will also build brand loyalty among the florists themselves who find themselves as part of the FTD community. Also, FTD is now taking part in co-branding by making deals with Gerber, M&M Mars, and Campbells soup. Each company will issue a separate branded product to go
along with a bouquet of flowers. Each product will have different themes. Lastly, by offering frequent flyer miles, customers see the product as differentiating itself in offering a service other flower distributors do not. My recommendation for FTD would be to tap into a younger audience, bringing in brand loyalty from a fresh generation. My suggestion is to make a deal with Facebook where an FTD flowers application can be downloaded. Then for a dollar any person using Facebook can purchase and send virtual flowers to their friends, spouses and families. In this way, FTD has the freedom to create virtual flower concepts for a low price while reaching a larger, younger audience. This audience when they mature will want to purchase real flowers rather than virtual ones and will trust the FTD name. In any event, FTD did a good job of responding to competition. Without a website, the company would have never survived. The website has the necessary service features, such as special updates, catalogs of all the products, and easy delivery. Second, by making the Mercury Network, the company intelligently held onto its key employees. This software will continue to attract the top florists to FTD. Also, by co-branding and using frequent flyer miles, FTD is differentiating its product in a necessary fashion to get its name promoted. People will build sentimental value with FTD, which can be one way to attract customers. The greeting cards seem like a gratuitous idea and I doubt it will make a significant difference in FTDs hope to gain back market share.