Solution
Prince answered on
Nov 03 2022
Question 1:
The second-largest greeting card company in the US was American Greetings. Since its founding in the 1900s, the corporation has had to deal with significant change and a highly competitive market. Given how simple it is to send an electronic card via social networks or text messaging, the greeting card sector is facing greater competition as a result of technological advancements like smart phones and social media influence. The cu
ent craze is moving away from traditional cards and toward the countless photos and canvases you can buy online. According to industry study, the sale of greeting cards has decreased significantly by 9% since 2005, and this loss is expected to continue.
The company decided to sell their greeting cards through conventional retail stores for the paper products and to various websites for the electronic products as a result of the switch from print greeting cards towards electronic ones. AG possessed the rights to well-known characters including Shortcake, Strawbe
y, the Care Bears, Holly Ho
ie, and others in order to grow their business. Additionally, they are the owners of well-known companies such as Carton Cards, Gibson, Recycled Paper Greetings, Papyrus, and DesignWare. The corporation was able to make money by licencing the rights to such characters and growing its market share.
The other major player in the US greeting card market, in addition to American Greetings, is Hallmark. If we compare the two, Hallmark is a larger organisation than AG because it also has a television network channel. The technological revolution is also hurting Hallmark, which is attempting to use fresh approaches.
With significant market advances, AG has also em
aced new methods to stay with the technological revolution. These new tactics included a new selection of electronic cards as well as the availability of online shopping for these cards with delivery of the actual card. Additionally, by adding kiosks to stores and extending the retail channel for dollar stores, they paid particular attention to distribution. By putting these tactics into practise, sales growth increased from about zero to over 7%, and operating margins increased to 9%. To stay inside the numbers, they must choose whether to purchase back $75,000,000 worth of their shares.
The huge demand for actual cards is the primary driver of AG's intrinsic value. According to a poll, 52% of US consumers still own greeting cards. This demonstrates that there is a market for AG still. Since market demand is shifting quickly, it will be difficult for AG to maintain its market position if...