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Greeting card companies need a sympathy note

Many people are giving up cards in favor of digital alternatives or are simply sending fewer cards between major holidays like Christmas and Valentine's Day.

Now , major retailers, including CVS and Walmart, are listed to cut back cards, and greeting card companies have closed hundreds of standalone locations.

To be sure, there are encouraging signs in some parts of the business, including premium cards that cost more than $ 10, budget cards that cost less than $ 1 and personalized options.

But Kevin Hourican, president of CVS Pharmacy, customs USA TODAY in an interview that the company has too much space devoted to greeting cards. He said the retailer, which has some 9,600 locations, is shifting more to health care products after determining that greeting cards are not selling well, using an internal analytics tool.

"More and more people are using text and email and e. -cards, and fewer people are buying cards, so that would be one area ”where the company expects to cut back, Hourican said.

Walmart is" reimagining what we're putting in stores, "said the company's US CEO, Gregory Foran. "We really need the amount of lineal footage that we've got in greeting cards?" He said on a conference call earlier this month.

Americans are still buying more than six billion cards per year, according to the Greeting Card Association, which did not provide more detailed statistics on trends in the industry.

But greeting card industry sales are declining at an annualized rate of 3 percent through 2023, according to market-research firm IBISWorld.

Retail space occupied by greeting card stores declined by more than 27 percent from 2013 to 2018, according to real estate data firm CoStar Group.

“One of the huge factors impacting that is technology and social media and the ability to contact people for special occasions through these platforms, ”said IBISWorld analyst Tanvi Kumar, who has studied the industry. "There is a huge surge in e-cards."

The disruption is rippling through the traditional greeting card industry.

The industry's second largest maker, American Greetings Corp., sold a majority share of itself in April to private equity firm Clayton, Dubilier & Rice. And the company replaced CEO John Beeder in February after only about a year on the job, announcing that co-CEO Zev Weiss would return to the top role.

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IBISWorld estimated that American Greetings' revenue declined by about 16 percent over the last four years. The Cleveland-based company declined to comment for this story.

Industry sales leader Hallmark Cards has cut more than 1,000 jobs in the U.S. over the last five years due to a decline in profits, according to IBISWorld. The company also has about 28 percent of its retail square footage from 2013 to 2018, according to CoStar.

Lindsey Roy, chief marketing officer and vice president of the Hallmark Greetings business, said the company has "some of the same overall market dynamics" but that cards are "pretty flat" overall.

“Our Hallmark Specialty stores have declined over the years. There are fewer, ”she said. But "we are definitely at the point where we really feel like we can stabilize that trend."

Millennials are still buying cards

It's not all bad news for greeting cards.

For example, it's a myth that young people aren't buying them.

As a millennial steeped in social media, Elizabeth Flake doesn't want to give up the tactile and personal experience of giving and receiving cards.

“I grew up in a greeting card family – my dad is an avid Hallmark shopper, and my grandma has always been known on holidays and birthdays to display all her cards on the kitchen table, ”said Flake, a wedding and event planner in Chapel Hill, North Carolina.

Hallmark's Roy said that counter to conventional wisdom, millennials like greeting cards as a meaningful alternative to social media interactions.

"In a world that's highly digital and fleeting and fast, to have something that's unique really stands out," she said . [19659005] Entrepreneurs, niche card sellers and specialty players are also taking advantage of interest among millennials in cards.

The biggest thing that everyone is trying to do is tailor their greeting cards towards the younger crowd, "IBISWorld's Kumar said. “They take a more casual tone. They're ironic, more comical. ”Lovepop, a start-up featured on" Shark Tank, "sells premium pop-up greeting cards that often cost more than $ 10. ” width=”540″ data-mycapture-src=”” data-mycapture-sm-src=””/>

Lovepop, a start-up featured on "Shark Tank," sells premium pop-up greeting cards that often cost more than $ 10. (Photo: Lovepop)