Greeting Cards
SIC 2771
NAICS 511191
The greeting card industry designs and publishes greeting cards for all occasions. In addition to paper cards, the industry has adapted to Internet demand and makes available many lines of cards intended for electronic transmission. These cards are published for mass sale and exclude hand-painted cards and other one-of-a-kind cards made by crafts people for individual sale.
Throughout the centuries, people have exchanged messages of goodwill, good wishes, condolence, and love. It was only within the last century, however, that these messages were formalized into "greeting cards," and only in the very recent past that electronic cards became an immensely popular way to communicate. The Greeting Card Association (GCA) reported in 2004 that Americans purchase approximately 7 billion cards annually, generating almost US$7.5 billion in sales. The U.S. Postal Service delivers millions of these communications daily. In 2001, an estimated 2.6 billion cards passed through the U.S. Post Office during the Christmas season alone. Christmas is the number one holiday and Valentine's Day is the second, inspiring the sale of about 1 billion greeting cards in 2001. In the holiday greeting cards market, far behind Valentine's Day, comes sales for Mother's Day (4 percent of all special occasion cards), Easter (3 percent), and Father's Day (2 percent).
The audience for cards is quite clear. Females purchase 80 percent of all cards in general and 85 percent of all Valentines. The industry promotes and endorses special and personal occasions that keep the cards flowing, including "days" for secretaries, bosses, and grandparents. In fact, these personal occasion and "just because" cards hold a majority of the market, even ahead of Christmas. Nearly 87 percent of all card sales fall under the categories of birthday (60 percent of category sales), anniversary, get well, friendship/encouragement, and sympathy. One of the most frequent senders of cards is the United States White House, which sends birthday cards from the current president to citizens over age 80, to newlyweds, and others for approved special occasions.
In short, what was a US$2.9 billion dollar industry in 1988 in the United States grew into an industry with sales of US$5.5 billion in 1997, the last year figures were collected by the U.S. government. This steady, though measured, growth came to a halt at the turn of the century, however. Falling revenues in 2000, 2001, and 2002 for the major players in the card industry, such as Hallmark Inc. and American Greetings, demonstrated that buyers tend to purchase more cards in times of prosperity and economic good news. The volatile dot-com e-card business collapse in 2000 also taught the industry that major losses could be incurred in spite of frequent and repeated customer visits at the "free" card sites. By October of 2001, industry analysts stressed that the September 11 terrorist acts had thrown the greeting card market into further freefall, and though the industry tried to fight back with new lines of patriotic cards, industry-wide losses were expected through 2003. Though unit sales have picked up slightly since then, revenues have remained flat and are expected to remain so until at least 2007.
According to U.S. government figures, about US$117.8 million worth of U.S. cards were exported in 2004, primarily to Canada, Mexico, Australia, the United Kingdom, and Germany. This was substantially lower than the US$137.2 million exported in 2003 and far below a high of US$152.9 million in 1997. Though the value of U.S. greeting card exports to Canada and Mexico declined from 2003 to 2004, these countries remained the primary destinations for U.S. cards, importing US$90.8 million and US$15.9 million, respectively, in 2004. By contrast, sales to Australia increased in value from only US$1.1 million in 2003 to US$2.0 million in 2004.
Card prices range from US$0.50 to US$10. Though the average price increased from US$2 in 1997 to a range of US$2 to US$4 in 2002, the impact of deep discounting stores helped cut the average price per card to just under US$1 by 2003. In a typical year, a person is likely to receive 20 cards, 8 of them birthday cards. U.S. households purchase about 35 cards annually, and about 90 percent of all households send at least 1 card annually. The GCA publisher member companies account for 90 percent of the industry market share, including independent greeting card publishers, although the top 2 industry giants, Hallmark and American Greetings, dominate with market shares of 50 percent and 35 percent, respectively.
Not that many years ago, one out of every two greeting cards were sold in card shops. In the 1990s that ratio changed to one in three. The change was caused by the growing number of greeting cards sold through mass retailers. Hallmark Cards, Inc. was affected most by this shift, and was forced to close some of its card shops and shift its attention to distribution through third-party retail outlets. American Greetings Corporation and Gibson Greetings Inc. were less affected by this shift as they had traditionally turned to retailers for the distribution of their products. In fact, according to an August 1992 article in Industry Week, American Greetings employed the only in-house, full-time sales promotion department in the industry geared to the development of chain-specific promotions and retail traffic.
Industry analysts point to what they call Hallmark's over reliance on its own retail stores for distribution as one reason the company lost market share in the early 1990s. Representing about 42 percent of the market in 1994, Hallmark had claimed 45 percent only five years earlier.
As the marketplace became more diverse, vendors continued to seek new ways of meeting the needs of their customers and increasing sales. Alternative or non-occasion cards were the fastest-growing segment in the greeting card industry. Other significant areas of growth were the senior and Hispanic markets. Environmentalism was another topical issue, the importance of which had not escaped the greeting card industry.
Between 1989 and 1995, employment in the greeting card industry stabilized between 21,000 and 23,000 employees. The industry tends to employ people with creative arts backgrounds, from graphic designers and writers to photographers and printers. Also, the work of many notable writers throughout the years—including Ogden Nash, Charles Dickens, Walt Whitman, Emily Dickinson, Mark Twain, Elizabeth Barrett Browning, and Norman Vincent Peale—has been used in greeting cards. Helen Steiner Rice, who wrote verses for Gibson Greetings (now part of American Greetings), was...
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