HALLMARK'S LOW PRICES ARE GREETED FAVORABLY

JOEL ELSON

KANSAS CITY, Mo. -- Supermarkets are welcoming efforts by Hallmark here to change consumer perceptions that greeting cards are priced too high with its new $10 million ad campaign.

Over the last several years greeting card prices have risen and met price resistance among shoppers. This has partially contributed to flat sales within the $7 billion a year greeting card industry.

Launched last month, Hallmark's national campaign includes network TV, radio and in-store promotions that will run through May. The seven TV commericals compare greeting cards to other items that are similarly priced such as a can of soup or bag of potato chips. The commercial spots focus on lower card prices of $1.65 and $1.95.

"Greeting cards are expensive, and it's in everybody's best interest to make a statement to customers that they can buy a $5 [card]. But if they want a lower-end card they can buy that too and get the Hallmark quality," said Jan Winn, director of health and beauty care and general merchandise at Big Y Foods, Springfield, Mass.

Hallmark's marketing drive does not apply to its Ambassador Cards, said a company official. Radio spots specifically call out the Expressions From Hallmark brand with the theme "Spend a Little, Care a Lot with Expressions From Hallmark."

Expressions sections will receive signs that identify cards priced under $1.99 and will be reinforced by floor and ceiling signs that read "Lots of Cards $1.99 or Less."

"A lot of people think cards in general are too expensive, and we're out to correct that that misinformation," said Steve Hahn, vice president of marketing for supermarkets at Hallmark.

"We hope to alert consumers to the fact that not only are our cards reasonable in price, but they are also outstanding in quality and value," he stated.

More than 50% of Hallmark and Expressions From Hallmark cards are priced under $2. About 30% of the cards that Hallmark sells retail higher than that, with some priced to $4.75.

Point-of-purchase materials were placed behind card choices priced at 99 cents and $1.99 in Big Y's Expressions From Hallmark card centers.

Winn said the pricing signs "alert shoppers that want the under-$2 card that we have them. It also alerts them that we have the Hallmark name."

Hallmark's advertising and marketing salvo also "gives retailers with Hallmark cards some ammunition against the retailers with lower-end cards and those that discount cards heavily,"she added.

Although Hallmark research indicates more than 70% of greeting card purchases are under $2, "consumers perceive greeting cards to be higher than they actually are," said Hahn.

Rather than creating cards that are of lesser quality with lower prices or reducing selections, the marketing campaign's goal "is to make people aware of our existing card prices," Hahn said.

Although Niemann Foods, Quincy, Ill., has a Gibson Greetings card department, Art Awerkamp, the chain's nonfood director, said the Hallmark program could benefit his card departments by drawing consumer attention toward lower-priced cards in general.

"The talk in the industry is that we need lower-priced cards, and once pricing goes over $2.99, sales slow," said Awerkamp, adding that Hallmark's campaign could shift attention to Gibson cards in his stores.

Rod Boni, grocery merchandiser at Pay Less Super Markets, Anderson, Ind., said signs that identify lower-priced selections in the card section can stimulate total higher department sales. Pay Less carries Hallmark's Ambassador line.

Alerting shoppers to the lower-priced mix "puts cards on customers' minds, and as they look for the $2 cards they may actually trade up," he said.

To Boni, "cards are like anything else. They have a price-value relationship. Obviously the bigger cards are a little fancier with a nicer verse at a higher price."

"The perception that cards are higher-priced is based on the middle range, and trade-ups to a nicer card with better printing, paper and verse,"Boni said.

"While some cards priced $2 and lower may say the right thing and be OK, for special occasions you want a larger, fancier card," he said.

"If all the cards out there were in the $2 range but none of them were the upscale fancy ones that we like to buy once in a while, there would be complaints about that too," he added.