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Greeting card companies pushing the envelope to remain competitive

While many people prefer to communicate their thoughts and feelings electronically, others still say a card makes it special.

Los Angeles Times

While many people prefer to communicate their thoughts and feelings electronically, others still say a card makes it special.

LOS ANGELES — The greeting card business may be in need of a get-better-soon card.

In the Internet age, with electronic greetings of all kinds now available, sales of traditional greeting cards have been on a long, gradual decline. In 1995, the national Greeting Card Association boasted that 2.7 billion Christmas holiday cards would be sold that year. This year, that number has dropped to 1.5 billion cards.

Even so, greeting card makers say don't count them out. The industry estimates overall sales of 7 billion greeting cards this year. New lines of cards and new products are being introduced every year, and the industry's second-largest card publisher, American Greetings Corp., has turned around sales in the last two quarters after a long decline. (Industry leader Hallmark Cards Inc. does not make its sales and profit public.)

"Even with the boom of social media, the death of the traditional greeting card has been vastly exaggerated," said Susan January, president of the Greeting Card Association.

Consumers themselves are split. Five years ago, Sharon Matthew stopped sending the 25 holiday cards she sent out every winter and switched to sending Christmas messages by e-mail.

"It's just better," said Matthew, 38, who was shopping at the Grove shopping center in Los Angeles. "My friends are all over the world. It's easier to send them this way — you can attach more than one photo, give a little update on what's going on."

But not everyone feels that way. Elizabeth Escamilla, 45, still sends about 100 cards every Christmas. "It's that one time of the year to write something personal, extra meaningful."

Christmas leads the list in terms of card popularity with nearly 1.5 billion expected to be sold industrywide, according to Hallmark Cards, followed by Valentine's Day with 144 million.

Experts attribute the card sales decline to increasing competition from e-cards and custom card services, as well as more modern, and time-efficient, ways of communication.

"The industry's been really, really suffering from social media and email," said Kathleen Ripley, industry analyst at IBISWorld Inc.

Retail greeting cards is a $7.5 billion business these days, the Greeting Card Association estimated. There are more than 3,000 greeting card publishers in the United States, with the two largest companies — Hallmark and American Greetings — holding 82 percent of the market share, according to IBISWorld.

Like other nonessential consumer products, greeting cards felt the effect of the recession, but January said that the industry is fairly recession-proof.

"Because our products have such a low price threshold," she said, "we didn't experience the total sales crash-and-burn other luxury items may have had."

The United States has also seen a decrease in the number of bricks-and-mortar greeting card stores. Citing the shifting real estate market and high overhead costs as challenges, Jacyln Twidwell, spokeswoman for Hallmark, based in Kansas City, Mo., said there were about 3,700 Hallmark Gold Crown card and gift stores five years ago. That number has dropped to 3,000.

"Our observation is that electronic communication is better for sharing information," she said, "but greeting cards are better for sharing emotion."

Hallmark has expanded its card selection and features, adding niche cards in categories that include godchildren, school bus drivers and hairdressers. It's all about staying relevant, Twidwell said. The company also has new 3-D cards, more cards with sound and even holiday cards with lights that pulse to music.

American Greetings is taking on similar challenges in an ever-changing marketplace.

The company is reaching out to younger customers. It said it is keeping up with multimedia features, updating its holiday digital slide show cards — paper cards holding LCD screens that display personal photos uploaded by the sender. And it launched its justWink line in June. These cards come with codes that, scanned by a smartphone, lead to an online app that enables customers to create virtual greeting cards.

The company expects more card exchanges this season with justWink's more mature and humorous holiday greetings — "Baked. Stuffed. Blitzed. . . . How will you be celebrating this year?" one Thanksgiving card said.

Greeting card companies pushing the envelope to remain competitive 12/03/11 [Last modified: Saturday, December 3, 2011 3:31am]
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