American Greetings has been building its sturdy house of cards for more than a century. The #2 US maker of greeting cards (behind Hallmark), the company makes American Greetings, Carlton Cards, Gibson, Recycled Paper Greetings, and pricey Papyrus brand missives. While greeting cards make up about 75% of sales, the company also produces DesignWare party goods and Plus Mark gift wrap. The company's AG Interactive subsidiary distributes online greeting cards and other interactive media. American Greetings' products are sold through card and stationery stores, mass merchants, and other retail outlets worldwide. American Greetings is owned and run by the family of its chairman Morry Weiss.
Change in Company Type
In August 2013 American Greetings was taken private by its founding family in a deal that valued the company at $551 million ($19 per share). The company was acquired by the Weiss family, which includes chairman Morry Weiss. The family formerly controlled about 45% of the company's voting stock. Founded in 1906, American Greetings had been a public company since 1969.
Wal-Mart and Target together represent about 30% of American Greetings' sales. The company's core business continues to rest on traditional greeting cards and other printed products, a market segment that has largely consolidated around Hallmark and American Greetings. However, technology is rapidly changing the way people communicate and interact, putting the greeting card business into competition with online social networks such as Facebook and photo sharing services such as Flickr (owned by Yahoo!).
Cleveland-based American Greetings rings up about 70% of its sales in the US. The UK contributed more than 15% of sales.
American Greetings has annual sales of about $2 billion.
The company is struggling with a decline in its core business: paper greeting cards. (Why bother to buy and mail a card when you can send birthday greetings via Facebook in just seconds?) To stay relevant in the digital age, the company is focused on developing and acquiring interactive technologies and other new products to expand its offerings. AG Interactive boasts about 4 million subscribers who have unlimited access to its e-cards and ringtones. Also, in March 2014 the company launched Blown Away, a new collection of pop-up birthday cards with lights and sound.
At the same time, American Greetings continues to expand its traditional cards business through organic development and acquisitions. The company acquired UK-based specialty greeting card retailer Clinton Cards in 2012. The deal included about 400 stores representing approximately $315 million in annual revenues.