They called it printing money. Indeed, you don’t need to be a retail guru to see the value in buying a card for less than 30p to then sell it to the customer at £2.00. But alas the unfavourable economic winds and the Odyssean hubris of the management team led to Clinton Cards falling into administration in May 2012, resulting in the closure of 370 shops and the loss of nearly 4000 jobs.
The business was started by a man with a simple dream, Don Lewin desperately wanted to own a Rolls Royce car. The secondary school dropout grew the business from a starting investment of £500 in 196to its height of around 1000 retail outlets in the UK, generating enough profit to buy several showrooms worth of his beloved cars. So, what went wrong?
Arguably the biggest contributor to Clinton Card’s downfall was the incredible, if not unlikely force of a lunar swine and a disco bird. Both Moonpig and Funky Pigeon undercut their retail rival with a better product and a lower price level. Customers flocked (and trotted) to sites that allowed them to personalise their greeting cards and post them to their loved ones without ever having to leave their desks. Both companies invested heavily on highly effective (if not mind-numbingly horrific) television advertising to spread their product, with the promise of free delivery sweetening the deal. These businesses were able to charge less because of their relatively low cost base, in stark contrast to the high cost of prime high street retail space; it appears that students aren’t the only ones who struggle to pay rent in St Andrews.
Management initially refused to act when these new competitors arrived on the scene, and when they eventually did add their own, poorly promoted, online outlet, it was simply too little, too late. American Greetings, a supplier of Clinton Cards, called time on the company’s £35m debt and acquired the stores into its subsidiary, Lakeshore. American Greetings has stated its intention to invest $20 million to reboot the business, though it will certainly need to learn from Clinton’s previous mistakes and redefine itself as a brand if it wishes to survive on our evolving high street.